The phrase usually used is a "leaky bucket". Sure a company can operate in a neutral space, but it's unlikely that overtime their revenue growth will match thei

The phrase usually used is a "leaky bucket". Sure a company can operate in a neutral space, but it's unlikely that overtime their revenue growth will match their customer churn. At the same time, a lack of growth limits how much can be invested on staying relevant in terms of R&D which further separates them from competitors with a positive growth trajectory. Its also incredibly hard to kickstart a growth engine once it has slowed down. The net result is a flywheel but in the opposite direction. PE buys companies like this to slow that negative growth flywheel down attempting to stay neutral until the investment is paid off at which point profit can be made. The long tail is massive attrition as well, because few people want to work at a sinking ship or rather a ship unwilling to invest internally. Neutral isn't bad, but it's very hard to exist.