adj. Of a startup company: making a profit, but not enough to pay salaries to the founders.
“We didn’t actually need the money in terms of survival,” he said. "We're already placing enough people to profitable per month, and we’re not talking 'Ramen profitable.'"
Contextly has raised some angel investing and claims more than 600 clients, including PBS, Modern Farmer and Make magazine, but is in the "ramen profitable stage," Singel said.
Believing that they wanted to give it 100 percent before closing shop, they applied to the Y Combinator program. They were accepted, but unfortunately their acceptance was during the most difficult time to raise capital for startups. They were told to get "ramen profitable," an expression that is used to describe the state of barely breaking even.
A startup with a couple founders in their early twenties can have expenses so low that they could be profitable on as little as $2000 per month. That's negligible as corporate revenues go, but the effect on your morale and your bargaining position is anything but. At YC we use the phrase "ramen profitable" to describe the situation where you're making just enough to pay your living expenses.
A ramen profitable startup is considered to be doing well because at least its revenues are greater than its expenses. Unfortunately, those expenses don't include salaries paid to the folks who founded the company, making them poor enough that they have to subsist on cheap food such as ramen noodles. Of course, if the company becomes a unicorn, they can switch to steak.