Startups are valued over the prospects of their lifetime profits, and not necessarily the profits they make right now.
A profitable business model is more important than the startups value for LEAN startups without venture capitalists.
Reference
Thiel, Peter, and Blake Masters. Zero to One: Notes on Startups, or How to Build the Future. Virgin Books, 2014.
Highlights or timestamps
But even if the company doesn’t initially make profits, it can still have value. it can take years for a startup to become profitable.
— ^52314c from Zero to One