Like any company, the financial performance of a company is of extraordinary importance. However, the dynamic for a startup is somewhat different than an established company.
While it is encouraging for a startup to achieve revenue, it is less important than for an established company. If an established company is struggling to generate positive cash flow it may indicate trouble for the company. However, it is not uncommon for startups to undertake years of work before reaching profitability. As opposed to a startup’s potential revenue and profitability, it is more important to examine the company’s proof-of-concept and scalability of the product or service.