[rossdavidh]

I think the difference between legit and illegit is whether or not your competitors have to go out of business for you to become profitable. If you burn through some cash to get off the ground, eventually driving your per-unit costs down so that your prices become profitable, that's legit.

If on the other hand your current prices are never going to be profitable (looking at you, Uber), and your business plan requires that your can raise them a lot without losing sales (because your competitors are gone), that is not legit.

The third factor in all of this is that many companies like Uber weren't really ever likely to become profitable in any scenario, and this was really about taking the cheap VC money while it was cheap. Blitzscaling was just a way of pretending that you would someday become profitable.

I think higher interest rates will get rid of a lot of this.