They spend every cent (and then some) on growth. The model is to capture the market. You have to spend to do that. Once you do that, you can set the terms.

Also, it happens to bring growth company valuations and a nice exit. What happens after that (ie if the entire thing was unsustainable), honey badger VC don't care.

You also don't have a choice but to play the game. If you don't, your VC funded competition will outspend and destroy you.