You could get funding for a portable neighborhood pony washing service if you built an iPhone app backed by an AWS service and called it Uber for Pony Washers (or some such)if you looked hard enough.
As the article points out, this is changing. The boom part of the boom-bust equation is starting to flatline with IPOs happening less frequently and for less money and the institutional investors who get in later in the game to buy out the initial VCs being more gun shy about investing.
Net result for the market? Startups need to focus on being a functioning business generating positive cash flow rather than a money pit that occasionally generates a lottery ticket. Not everyone will succeed, but the changing economic climate will push a lot of the fair weather pony washing app founders out and leave the more seriously business minded people which should result in a new wave of solid companies capable of handling more strenuous economic conditions.
A startup that's not cash flow positive right now but could be massively so in the future (or, atleast, the market expects it to be massively cash flow positive in the future) is significantly more valuable than a startup that is cash flow positive right now but with not a ton of room for growth.
In fact, placing the requirement of cash flow positivity right at the beginning of the startup would probably squash a lot of good (i.e. valuable in the long-er term) ideas.
Valuations are made out of belief (whole cloth).
The requirement is not a must, but you should take into account startup's burn rate over funding, which should eventually turn into burn rate over revenue. (without taking extra funding into account)
So, a startup that would have a huge burn rate should be much less valuable, as you're liable to lose money both short and long term. Same as with the bets, taking large bets with long timeframes is more liable to turn you bankrupt (both VC and startup owner) than taking small bets often, since you can back out at any given time. (I'm not talking about motivation, that's a separate thing.)
However, markets are not rational, so startups with high burn rate are considered very valuable for some reason.
Companies can choose to not be profitable on purpose though, by re-investing revenues back into the business. Heck, Amazon's basically never turned a profit.