Sorry for copy-pasting from Matt Levine's column, again. At least I get cheetah's comment for free :-)
What makes this funny to me is that Matt takes the second-order literature derivative (yes, I know there is no such thing) of the usual stuff I read on investments:
Venture capitalists love investing in businesses with massive losses, terrible unit economics and no path to profitability, as long as they are big and fast-growing. Prominent venture-backed companies sell desirable products at far below their cost, essentially subsidizing consumers’ lifestyles with venture-capital money. (This theory is sometimes called “the MoviePass economy,” after a Kevin Roose column.) We have talked, a couple of times, about why the venture capitalists might care about growth and not profits, with possible answers including (1) they correctly believe that in the long run rapid growth will lead to monopoly profits, (2) they incorrectly believe that, (3) they are just nice or (4) they are trying to forestall socialist revolution by giving people cheap stuff. “The fun view of the venture-capital-subsidized perpetual-loss-leading user-growth-at-any-cost economy is that it represents socialism as the transcendent end state of capitalism, a capitalism that is so refined that it consists of just giving people free stuff in exchange only for their willingness to take it,” I once wrote.
