"But here's what really jumps out. If you sell something for $10 but it costs you $20 to make it (or license it), how can this be profitable?"
On spending $2 to gett $1 in new sales revenue:
ReclinerTimmy's rebuttal: “We lose money on every sale, but make it up on volume.”
"So our strategy is to buy a pizza for $16 and then to slice it into 8 pieces and sell them at $1 per slice. This is our plan to move to profitability. Oh, and we gave ourselves raises and more stock too, so we can afford to buy the slices."