These tech companies are worth billions of dollars but have yet to turn a profit: From Airbnb to Revolut
Tech companies have raised millions of dollars in funding and are worth billions in market capitalization. But when you take a deep look at their operations, they all have one thing in common: zero profit. Unknown to many, these famous tech companies barely break even while others are just bleeding cash. But what’s keeping them alive is their potential for growth and investors who believe in them.
Ever wondered how long it takes a company to start making money? With our favorite companies reporting record revenues each and every year, how long did it take them to build up their company to this level? Despite huge revenues, in reality, It can take many years for even the most successful brands to actually turn a profit.
From Airbnb to Revolut, new research conducted by the team at Approve.com found that most of these famous tech companies are still struggling to turn a profit. The study looked at the most popular and well-known brands and explored their founding year and their first profitable financial year, to reveal the fastest companies to turn a profit & those that still aren’t profitable.
Companies that have yet to turn a profit:
|Company||Founded||Current Revenue (Billions)|
Epic, creator of Epic Games and known for the incredibly popular Fortnite among other titles, was founded way back in 1991 and has still yet to turn a profit.
Reddit, founded in 2005, is still focused on growth instead of profitability and has never reported an annual profit. Reddit has, however, begun heavily investing in the ad platform, which may see the company become profitable as soon as 2022.
Market-disruptive tech company Airbnb demonstrates higher revenues ($5.30bn) than some of the most successful and profitable companies, for example, Twitter ($5.1bn) and Snapchat ($4.1). However, the company has yet to turn a profit.
WeWork, a former unicorn startup with high revenues, still operates at a loss 14 years after being founded. The company’s management projects that the company will reach a breakeven point in 2022.
Top fastest companies to turn a profit:
Some companies, such as Dropbox and Tesla, waited over a decade before turning their first profit. Tesla spent 17 years unprofitable, largely due to burning through tremendous volumes of money in order to grow. Tesla was driving new and advanced technology, electric vehicles, and had the backing of a very wealthy founder with seemingly endless pockets (Elon Musk, currently one of the richest people in the world).
|Rank||Company||Founded||First Profit||Years to Profit||Current Revenue
|3||Alphabet / Google||1998||2001||3.0||$239.2|
The study also looked at the fastest companies to turn a profit:
Ford ranked first as the company that started making money fastest, in fact, it only took Ford five months to start turning a profit. Apple ranked second, managing to turn profit in only two years, while Google came in third place, taking three years to start making money.
- Amazon, one of today’s biggest multinational companies dominating the e-commerce industry, only turned its first profit nine years after being founded.
- Tesla spent 17 years unprofitable, largely due to burning through tremendous volumes of money in order to grow.
See the findings of the study here: https://approve.com/time-to-profit/