Their entire company's value was based on advertisers paying to reach their users. They built spreadsheets explaining how 1 subscriber today equals $X in future revenue, and then raised funds based on that.
Now that those subscribers are gone, their future profit is evaporating. Investors lost a bunch of money, and if they used their stock as leverage, there are going to be leverage calls.
Any company started in "Silicon Valley" since about 2005 has been valued at how many eyeballs they can get glued to their website. Everything about that place is a scam. When they get eyeballs, the money starts flowing. When those eyeballs look elsewhere, they go bankrupt. It happens every single time.
Advertising NEVER makes sense for any company, and one by one companies figure this out. What Coca-Cola does is charity for the ad industry. The fact that YouTube is showing ridiculous ads for free mobile games that make money by advertising should tell you everything you need to know of where that company is really at.
They always have been losing money.
Their entire company's value was based on advertisers paying to reach their users. They built spreadsheets explaining how 1 subscriber today equals $X in future revenue, and then raised funds based on that.
Now that those subscribers are gone, their future profit is evaporating. Investors lost a bunch of money, and if they used their stock as leverage, there are going to be leverage calls.
Any company started in "Silicon Valley" since about 2005 has been valued at how many eyeballs they can get glued to their website. Everything about that place is a scam. When they get eyeballs, the money starts flowing. When those eyeballs look elsewhere, they go bankrupt. It happens every single time.
Advertising NEVER makes sense for any company, and one by one companies figure this out. What Coca-Cola does is charity for the ad industry. The fact that YouTube is showing ridiculous ads for free mobile games that make money by advertising should tell you everything you need to know of where that company is really at.