What? The underlying assumption is that, even VC backed companies, can cover their costs with their revenue.

It is just a matter of order. When you have capital heavy enterprises, you usually have your costs before you have your revenue.

The purpose of VC funding is not to reach profitability. It’s the reach an “exit” - usually via an acquisition or occasionally via an IPO.

But out of the literally thousands of companies that YC has funded, only about a dozen have gone public and out of those, if you had invested equally when they IPOd, you would have lost about 50% of your investment.

https://medium.com/@kazeemibrahim18/the-post-ipo-performance...

A “success” for a VC company is not a company that ends up being a lifestyle business that muddles along.