In many ways, it's better to be a startup with a good pitch-deck, a cool idea, and no business track record than it is to be an established and profitable (but small) business.
Seems backwards to me, but that's the current mindset. Money has been so cheap for so long that, for a lot of PE funds, it's Monopoly money; much like baseball has transitioned from a focus on singles, doubles, and baserunning to an all-or-nothing home run hitting approach, VC and PE has emphasized buying "ideas" with tremendous "upside" instead of a profitable business that could grow if they had the capital to scale operations.