[flr03]

Startup are (almost) never profitable when they "start up". Hence they need to raise money through investors until they grow enough to develop a mature, profitable product. Delivering this product can take years and require a large workforce. In the meantime the company still needs to pay the employees and creditors.

Traditional businesses like electricians start with a typical business plan. They might need to borrow some cash at the beginning but if the business plan is spot on, they'll start making money quickly, enough to cover the costs and make profit.