Huh. Sounds like an inefficiency on the funding side. Or is it that these biz's profitability typically enable self-funding? Why does a profitable startup that doesn't have VC-style growth potential need funding?
It is a vicious cycle - once a market attracts the attention of VCs, it becomes really hard not to join in.
a) strict management/information rules - so burdensome that it is available only for big companies - i.e. corporations
b) startups with scaling - that is high growth business - where growing is the only option for the manager
c) having a partner with money who takes part in the management
And my personal experience of investing.
Yep. My scenario was told from the POV of an individual company. That's not a good way to explain the behavior of investors deciding between companies.