why not spend all of the recurring profit on growth? Why not, indeed? If you believe you have a big potential market and have control over your churn, you can run this play year over year, and you’re growing by 30 percent annually. And when the time comes to finally start taking profits, you’re working off a much bigger recurring revenue stream. This is why a lot of subscription companies may “look” unprofitable, but they are actually awesome businesses. It’s also why I roll my eyes every time I hear an analyst complaining about the lack of profitability at companies like Salesforce and Box.
