[notahacker]

I think the "VCs stealing from their investors" hypothesis is quite plausible, but there's plenty of reasons why someone might need to receive payments as 'investment' or 'revenue' rather than unexplained payments from suspicious people, especially if the money is being transferred internationally. Could also be a way of exploiting 'investor' and 'startup' tax breaks and collecting R&D grants whilst doing as little real research as possible (and eventually, having consumed all the cash, writing it all off as losses against tax bills)

And yes, there are also startups which produce only 'tech demos' of potential new business lines because they've accepted the product they were originally going to buy won't work, but their founders aren't ready give up yet, but not easy for them to convince investors to follow along for 5-7 years without revenue even if they're really good liars...