There is profitability and then there is VC-profitability. One of them normal people can understand and the other is absurd IMHO.
VC forces you to staff up, spend like there is no tomorrow, and have a huge return or GTFO.
$500M a year should absolutely support a company like Reddit (even giving the API away for free) but that’s not a 10-100-1000x return so it’s essentially $0 to VCs.
When Reddit says they aren’t profitable they really mean they aren’t profitable /enough/ coupled with their high headcount.
Working at a small startup (or a side project) will show you what can be accomplished with 1-10 or <50 people who are all committed.
VC forces you to staff up, spend like there is no tomorrow, and have a huge return or GTFO.
$500M a year should absolutely support a company like Reddit (even giving the API away for free) but that’s not a 10-100-1000x return so it’s essentially $0 to VCs.
When Reddit says they aren’t profitable they really mean they aren’t profitable /enough/ coupled with their high headcount.
Working at a small startup (or a side project) will show you what can be accomplished with 1-10 or <50 people who are all committed.