[derricgilling]

The economies change a lot when you can book that revenue up front. Many SaaS startups want to lock in year long contracts even if the total amount is less for this reason. That revenue can then be used to pay salaries, etc. Not everything has to be or should be paid by VC dollars.

Nest may have figured they could build a larger ecosystem in the IoT and Smart Home space and charge monthly at some later point but didn't materialize.