[gumby]

This is an important point. For this to work, step 0 is: have a functioning business. That’s what gives you the opportunity to then change the curve on your cash flow.

Another factor is your vendors. The cable business expanded (and expanded into) an existing ecosystem: tv mfrs, film studios etc. The restaurant already had vendors it could afford to lend 300K up front knowing that they would deliver reliably over the next four months. Also an operating business.

Likewise Amazon.

But the Ubers etc start without a viable business. In fact they start by skimming the cream of an existing market. The problem is, you get good at what you do. If you don’t build a viable business it becomes harder and harder to move your company into that mode as the environment changes.

[everythingswan]

Yea, the functioning/viable business piece has a place in this discussion. I can understand why the author wouldn't include it but it serves us here. To take on debt like mentioned, you have to have some confidence in the business model and not be searching for product/market fit like many early-stage companies. If you already have cash flow then you can leverage it.