this post was submitted on 05 Jul 2026
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Explain Like I'm 5 (ELI5)
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that does happen with small businesses or even large private bussinesses. Businesses have to be prepared for downtimes to so they need to have enough additional assests to ride them out. This is something people learn if they ever do it and why you see the statistics about businesses failing with X amount of time. To survive they either need assets they can draw on until they are profitable or make profit fast and once they do they need to gain enough to deal with a few years of loss during bad times. Then you have the profit motive. Businesses that are not growing need to make a profit but once businesses themselves are sold they need to show they are a good investment. In other words they need to appear to be growing or making profit on their profit.