Our simple explanation of cash flow probably sounds like a no brainer to you. Sure, but it's rarely that simple. Think about it in terms of a vacation. You pay for the vacation and set aside some cash to spend.
Business is the same.
Big Internet companies have been having the same problem. Most were initially started with the aid of funds from investors. These funds meant that the companies didn't have to work so hard at bringing in money from sales in the early days and could focus on developing their business plan, marketing strategy and technology instead. When the investors finally wanted to see some returns on their money, the companies just weren't bringing in enough cash to meet all of their overheads. Their cash flow situation was extremely bad and the investors started to lose their confidence.