" “In Silicon Valley, you have more people employed by money-losing companies probably than you ever have before,” Gurley said at SXSW. “Which is tenuous, because when the capital slows, then those [jobs] aren’t real anymore.”
“Probably” because it’s difficult to know how many people are employed by money-losing companies. But it’s not uncommon for money-losers to go on hiring sprees. Twitter and Amazon continue to hire like mad, and neither has ever been profitable. Snapchat and Dropbox are admired as decacorns (unicorns valued at $10 billion or higher), though both have little to no revenue. Dropbox is locked in an epic spending battle with competitor Box, neither with a coherent plan to eventually pay the bills they’re racking up.
A few of the underwater unicorns have made meager efforts to monetize lately, none of them particularly successful. Twitter, Box, Spotify, and Shazam have launched marginal monetization attempts, often with small numbers of advertisers or buyers. All four companies are almost 10 years old; Amazon’s pushing 21. As Dan Lyons wrote in a lovely Valleywag diatribe, “If you can’t make money after 10 years, what does that tell you?”
It tells you that bleeding-edge technology becomes synonymous with “bleeding money.” And even the startups that do make money have substantial risk looming."