EBITDA — earnings before income tax, depreciation, and amortization — is an accounting term that fell out of favor when the dot-com bubble burst. Many companies used this model because it let them ignore their large capital investments and crushing debt. But in today’s startup world, where up-front capital expenses have been replaced by pay-as-you-go costs like cloud computing, EBITDA is an acceptable way to consider how well you’re doing.
