1) As a CEO, I want headcount. Being the CEO of a 200-person operation sets me up for better jobs than a 50-person one. Being in high-profile organizations if good too (and when they fail, I can switch jobs). Same for VPs and managers.
2) As a CEO, I want bonuses. Those come from growth. Zero bonus is the same whether the company lives or stagnates.
3) Rationally, in winner-takes-all markets, a lot of this depends on early losses and overspending. If you and I are building eBay, and I get there for $10M and you for $100M in 10% less time running massive losses, you win. A lot of tech is winner-takes-all or winner-takes-most.
.... and so on.
Except for retirement account holders whose money is being spent, it's almost certainly better to be a cash-burning Potemkin unicorn than a growing, profitable 50 person company.
1) As a CEO, I want headcount. Being the CEO of a 200-person operation sets me up for better jobs than a 50-person one. Being in high-profile organizations if good too (and when they fail, I can switch jobs). Same for VPs and managers.
2) As a CEO, I want bonuses. Those come from growth. Zero bonus is the same whether the company lives or stagnates.
3) Rationally, in winner-takes-all markets, a lot of this depends on early losses and overspending. If you and I are building eBay, and I get there for $10M and you for $100M in 10% less time running massive losses, you win. A lot of tech is winner-takes-all or winner-takes-most.
.... and so on.
Except for retirement account holders whose money is being spent, it's almost certainly better to be a cash-burning Potemkin unicorn than a growing, profitable 50 person company.