3 ms·

Something is really wrong in this market when even a "successful" company like Squarespace deson't manage to be a profitable business.

klysm 2y ago
If growth is the goal, you sacrifice margin for revenue
- cduzz 2y ago
  And sometimes you sacrifice solvency as well? Gambling on exponential growth and then having the growth fall short (say, because people moved their personal web sites to facebook instead of squarespace) is a risk in any time you go big or go home. Sometimes (often!) you ... go home.
  - klysm 2y ago
    I would say most of the time you sacrifice solvency
lagniappe 2y ago
Headcount and marketing spend required to be perceived as "successful" in the industry is commensurately high.
HatchedLake721 2y ago
Because companies chose to not be profitable and invest all their money into growth.
cduzz 2y ago
It sounds like investors invested billions of dollars making a product that makes million dollars per quarter? So from that perspective, was this ever a successful company or just a grand party thrown by the investors? Isn't this just "how it works" ? The vast majority of investors in the railroads lost their money; lots of people lost money running fiber around the world, iridium went bankrupt and lots of people use those phones, etc.
- lumost 2y ago
  Not all investors are looking for the business to be profitable. NVidia investing in AI companies drives up demand for AI chips. NVidia is simply seeking to create a prisoner's dilemma around AI compute spending. If Nvidia is successful, then most of the money they invest will flow back into their coffers as margin + the forced spending by other parties to keep up.
troupo 2y ago
If you look at the past 10 years (or more) this has been the case with nearly every single poster child of successful US tech company. Look at YCombinator's top/most darling startups. Hardly any of them are profitable or sustainably profitable
- belter 2y ago
  My old fashioned view is, and notwithstanding periods of debt for grow investment, if you don't make a profit, you don't have a business.
  - rqtwteye 2y ago
    If you have enough money, you can kill a lot of viable businesses though.
- piva00 2y ago
  Seems like the model has been to sell it to the next sucker all along: an acquisition by a bigger company, the stock market, or just another PE company. Never to actually create a proper business...
Ekaros 2y ago
Are they actually successful or just succeeded in marketing their brand recognition. Probably with absolutely massive spend... Just how many people are in their market with whatever monthly spend they have.

klysm 2y ago

If growth is the goal, you sacrifice margin for revenue

cduzz 2y ago
And sometimes you sacrifice solvency as well? Gambling on exponential growth and then having the growth fall short (say, because people moved their personal web sites to facebook instead of squarespace) is a risk in any time you go big or go home. Sometimes (often!) you ... go home.
- klysm 2y ago
  I would say most of the time you sacrifice solvency

lagniappe 2y ago

Headcount and marketing spend required to be perceived as "successful" in the industry is commensurately high.

HatchedLake721 2y ago

Because companies chose to not be profitable and invest all their money into growth.

cduzz 2y ago

It sounds like investors invested billions of dollars making a product that makes million dollars per quarter? So from that perspective, was this ever a successful company or just a grand party thrown by the investors? Isn't this just "how it works" ? The vast majority of investors in the railroads lost their money; lots of people lost money running fiber around the world, iridium went bankrupt and lots of people use those phones, etc.

lumost 2y ago
Not all investors are looking for the business to be profitable. NVidia investing in AI companies drives up demand for AI chips. NVidia is simply seeking to create a prisoner's dilemma around AI compute spending. If Nvidia is successful, then most of the money they invest will flow back into their coffers as margin + the forced spending by other parties to keep up.

troupo 2y ago

If you look at the past 10 years (or more) this has been the case with nearly every single poster child of successful US tech company. Look at YCombinator's top/most darling startups. Hardly any of them are profitable or sustainably profitable

belter 2y ago
My old fashioned view is, and notwithstanding periods of debt for grow investment, if you don't make a profit, you don't have a business.
- rqtwteye 2y ago
  If you have enough money, you can kill a lot of viable businesses though.
piva00 2y ago
Seems like the model has been to sell it to the next sucker all along: an acquisition by a bigger company, the stock market, or just another PE company. Never to actually create a proper business...

Ekaros 2y ago

Are they actually successful or just succeeded in marketing their brand recognition. Probably with absolutely massive spend... Just how many people are in their market with whatever monthly spend they have.