Revenue addiction kills companies.

It was always a bad habit. But in the AI transition, it has become deadly.

I love revenue. Who doesn’t love revenue? But some (and I mean MANY) companies aren’t just pursuing revenue. They’re absolutely addicted to it. I’m talking full foaming-at-the-mouth, short-term dopamine hit, sell-your-future-for-this-quarter kind of addicted.

The kind where you squeeze customers a little harder every quarter, slowly wreck trust, burn the brand, and then six months later everyone’s in a meeting asking, “Why is retention and growth suddenly bad?”

And here’s the hard truth: in this age of technological trAInsformation, that kind of revenue chasing is straight up fatal.

I’ll go even further: If revenue is your North Star, your company is destined to die.

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The problem is that right now every company needs to take a big bet on technological change - how the product is served and what problems they’re going to be solving for customers. These efforts probably won’t be revenue-positive in the short term. They may even hurt existing revenue that is going to be dwindling away anyway.

What does this look like?

Revenue-addicted companies become completely fixated on hitting made-up targets at all costs. Every key initiative gets judged by its immediate revenue impact, and revenue becomes the lens through which every employee is evaluated.

They operate with the mantra: If it doesn’t move revenue in a week? Kill it.

To make things worse, these companies tend to also be too optimistic about how much they can actually grow that revenue. So they’re always overforecasting and under-delivering, which creates a constantly increasing pressure cooker for them to perform.

I’ll say it again - revenue is great. The problem is that by goaling everyone on revenue acceleration, these companies end up prioritizing very short-term, very measurable initiatives. Best case, this looks like putting too much emphasis on funnel optimization wins. But often, this gets way worse and spins into things like dark UX patterns: ‘Let’s hide the free plan!’ ‘Let’s make the Xs smaller.’ ‘Let’s make the cancellation language really scary.’ That kind of crap. This also filters into monetization, when teams decide to arbitrarily increase prices just to buy themselves another year, which they’ll spend trying to figure out how to re-accelerate again.

And at the same time, they’re squashing long-term initiatives. ‘Doesn’t deliver in-year? Thanks but nah.’ No time for that, when everything is all-hands-on-deck to get this quarter’s revenue up!

This is especially prevalent for public companies, because they’re evaluated on their in-quarter performance. But it’s also extremely prevalent in private companies – maybe as IPO practice? They set targets for themselves and then can’t hit them … and they don’t even need to! It’s just a blind pattern of creating aggressive targets and then whipping everyone into a frenzy: ‘Because that’s what the budget/forecast says!’

The problem is that this approach works… until it doesn’t.

There’s a short-term boost at the beginning: everything gets locked in and you start out by bringing in more revenue and keeping it. But with all of this short-term fixation, the important stuff ends up slipping.

Innovation and risk-taking… dead. The real ‘point of no return’ line is when you prioritize ALL your work based on bottom-line impact. When your roadmap translates into short-term dollars… you’re effed. It’s basically saying: ‘If we cannot measure its revenue attribution, we’re not doing it.’ You’re never going to take any risks… and growing a business is about taking leaps of faith and risks.

Long-term strategic bets… dead. Revenue addiction leads to a slow and gradual and very painful decline. And it’s a vicious cycle that is almost impossible to get out of: Failure leads to more pressure, which leads to shorter horizons, which leads to more failure. Even when you have success, the problems are self-inflicted: Success also leads to more pressure (and higher goals), which leads to shorter horizons, which leads to failure.

Culture… dead. Once this approach sets in the culture, where everything is measured by revenue, it poisons the entire company. It drains the will of the entire org, because initiatives are tightly prioritized top-down on what can drive revenue, and all creativity gets completely shut off. Growth starts with a culture of accepting failure, and guess what’s not okay when everything is about this month’s revenue?

Anyone who can’t tie their contributions directly to revenue feels at risk, and no one is going to come up with really creative or risky ideas if their performance and comp is determined by the short-term dollar signs.

When the customers start leaving, it’s way too late. That’s a lagging indicator - sometimes one, two, three, four years in the making, because switching costs may have kept customers around for a while, even if they were desperate to leave.

I call this ‘The customer has left the room.’ Once the organization is fully oriented around business outcomes, customer satisfaction/value/delight is an afterthought. The internal conversations stop even mentioning the customers at all.

After a certain point, it’s irreversible for the business unless there’s some kind of massive step-function change… which I just have not seen happen.

From terminal to fatal

In the past, revenue addiction has been a guarantee of a long, slow death. Now… not so slow.

In a stable market, you could limp along for years - optimizing existing surfaces, shifting pieces around, burning out your team.

All that’s over now. Because in the face of AI disruption, every company needs to make a giant bet on how they’re going to deliver their product in a completely new tech landscape. This involves getting close to customers, investing in innovation, and making major bets.

And those are the exact things that revenue addiction prevents. The whole system is built around killing risk tolerance and openness to failure. Every employee has been trained to optimize their work around measurable, short-term revenue impact. All of the infrastructure to take big swings and go for anything besides hitting this quarter’s numbers is gone.

So if your whole company is orienting around revenue, you’re fighting a losing battle. Even worse… you’re shuffling deckchairs on the Titanic.

What’s the alternative? Revenue as an output, not an objective.

I’ll just go ahead and say that the opposite side of this coin can be just as deadly: User Engagement addiction. This is more common in early-stage companies and product-led organizations, because engagement is a crucial part of discovering your initial Product-Market Fit. The issue for these companies is when monetization is straight up discouraged. It’s a dirty word. But… obviously you still need to make money. Every company needs at least a path to profit. So no, I’m not telling you to just stop charging.

My approach is all about where you put revenue in your priority list: Revenue is on the chart, but it’s the output of the system, not the primary thing you’re optimizing for.

At Lovable, we’re figuring this out right now. This year, we swapped our North Star metric to be daily active apps. That’s an even farther step back from revenue compared to our last year’s metric (number of paid users), but it’s for this exact reason: We know that lifting daily active apps ultimately drives revenue (and paid users), but the revenue is the outcome, not the objective. (You can read more about this and the interactive app I vibecoded to share it with our team, in this post: Why every exec should be vibecoding.)

To go even further on this, we’re also optimizing against a qualitative measure of value - the Lovable Score, which combines:

• Net Promoter Score (NPS)

• Sean Ellis’ PMF score

• Customer Effort Score (CES)

• Customer Satisfaction (CSAT)

We’re surveying our users on a regular basis across these points, then standardizing the scores and weighting them for our particular priorities, and then making that a qualitative companion to our North Star, to keep our teams on track.

Which isn’t to say that your company should be doing exactly that. The point is… all of this helps Lovable to maintain a system where monetization is monitored and managed, but is ultimately an outcome of successfully addressing customer problems and concerns.

And I see it in the way our teams operate in the day-to-day. Lovable has really been the first company I’ve worked at where the balance is actually right - I bring up monetization opportunities and people jump on it… but aren’t obsessed or panicked about it. The stuff still gets prioritized, but the ultimate goal is creating a better product for our users.

Unfortunately, in my experience, there are maybe a single-digit number of companies who are keeping this balance at any kind of scale. It’s so rare.

No easy fix

I’ve tried to cure revenue addiction from the inside as an employee and the outside as an advisor. It’s never worked.

At one company, I recommended carving out 25% of the Growth org’s time for innovation - initiatives that would not be counted toward revenue attribution, to set the foundation for the long-term. I was basically begging the leadership to create new surfaces to be optimized in the following year… because without that, the company would run out of surfaces to optimize. But the brand new surfaces would have to be rough initially and wouldn’t be revenue-generating right away.

The leadership team initially gave lip service that they would do it. But when the time came, every quarter was just a slow, steady axing of every single innovation initiative or long-term bet. ‘No time for that, we need to drive revenue!’

So maybe it’s too late. I’m not here to give you a fake pep talk and you’ve got to know how deep this goes: This kind of addiction is deeply deeply rooted in the heart of companies. It’s based on the entire executive team steering the ship. And usually the only way that it can be changed is by scrubbing the exec team and starting over, unfortunately.

But these are desperate times. Maybe the feedback loop has always just been too slow for people to see it, and now people will start waking up.

If you’re a regular employee, I’m not telling you this so that you can fix it. You probably can’t. I’m telling you this for your own health and sanity, so you can see what’s actually going on in your company and plan accordingly. If you see the signs of revenue addiction, start making an escape plan. I’ve been telling people to increase their career optionality for years… now it’s absolutely non-negotiable.

If you do happen to be the founder or exec shaping the direction of your company: Take it seriously. Think about the path your company is on and have the hard conversations to change your trajectory. Just realize that this is a big, complex cycle to be broken. And it’s not going to happen on Slack. This is not a ‘Let’s hop on Google meet’ type of conversation. This needs to be at the top of your agenda for the next off-site discussion where strategic priorities are being set. And if you’re serious about saving your company, you should probably book that today.

And if you’re a new founder or part of a young team… just say NO.

Revenue addiction is a disease. It’s always been a nasty, deep-rooted bug. Now… it’s going to be fatal.

Friends don’t let friends get addicted to revenue!

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Edited by Jonathan Yagel.

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