For actually being in a company like that it's mostly that and bad overall management - at a time we did have a ratio of two (useless...) PM for on dev. Dev underpaid, PM overpaid (as expert freelance, of course, or with bonus), some huge expense made for stuff that make no sense (branding), negotiating badly some contract so that they cost the company more than they provide...
Of course after a while this stop since all these mismanagement corrupt the products too, and pretty fast you're left with a huge black hole for money that doesn't produce anything meaningful.