Showing revenue is not "tiny" by any means. Considering that the vast majority of businesses hide this from the public, I think it's very notably "something larger than tiny".
> "but practically speaking [they] are broke"
How do you know this?
> How do you know this?
They were not claiming a fact, they were posing a hypothetical.
Did you know there are whole businesses that lend money through ‘receivables financing’? Basically if you have outstanding invoices, you can get the money for those invoices now, and you pay (let’s say) 15% in interest to get that money now. https://www.allianz-trade.com/en_US/insights/receivables-fin...
All else being equal, your profitability just went down by 15% taking that receivables loan; but businesses are willing to lend money at varying degrees of interest while the company that took that money still looks like they’re in great shape if you were to look at their revenue, but 2 or 3 of these sorts of advance loans can hurt a company really quickly.
The issue is that it takes a long time, if a business is engaging in shady business practices, for them to be held accountable (if they ever are), and there are lots of ways to keep a business afloat while effectively robbing Peter to pay Paul.
I wish you had said that in your opening comment. Would've helped me consider where you were coming from.
I'm just making an overall remark, wondering what you're inferring, and more widely still digesting this entire post.
A client would pay an invoice and the balance would swing from -£20M to £0 and back down to -£15M for the next project within weeks! Revenue was in the £100Ms per annum.
As someone with almost zero business background it was a real eye opener how much we depended on a healthy relationship with the local bank manager. The business model clearly worked as they passed their 30th anniversary during my employment!
You end up leverage for all the goods but the final settlement of payment happens much later, making them hard to survive in without a lot of capital and good relationships.
You can screwed very easily and understanding the model and not scaling faster than your capital allows is a skill in itself.
My friend failed at it while I was working with them.
There's room for both.
To the parent commenter's point, we don't have enough information to know if that's true.
EDIT: the founder is on this thread (https://news.ycombinator.com/item?id=48933905) providing more info and explains that adding expenses on would be too burdensome.
So, yes, by comparison, this is very open.
Is it marketing material? Also yes. People who are considering using a small scale alternative to tech giant products will probably look at this and say “oh, this product has some traction, and this isn’t a fly by night business.”
This does not bode well for the entire AI industry.
https://news.ycombinator.com/item?id=48933905
But also, this is not a very constructive comment. They're pushing a new product that based on the upvotes this community is interested it.
For a potential customer deciding whether to trust a relatively small app (compared to Google and Apple) with their memories, these are useful numbers. 50% increase in paying customers this year. Nearly half a million registered users, with a 40% growth in the last 6 months. 5% of their users are paying customers. Revenue topping a million. That's stuff I want to know if I'm subscribing and uploading all my pics to their servers. I want to know if they'll be around, and my stuff is safe.
> So for folks that don’t know better, this is a very cool thing ente is doing. For folks that run businesses and know better...
Oh please. Perhaps work on not jumping to conclusions too quickly.
Well, you have that right. But apparently they IPO based on even less.
The most difficult part of a consumer SaaS or really selling anything on the internet is acquiring customers.
Zero revenue = zero profit automatically with no ability to ever make a profit.
If a startup has paying customers there's at least the chance to become profitable.