Cirrus is owned by the Chinese now. ROI was probably decent but the investors weren’t hanging around waiting for natural growth to pay them back. They bailed at the first sign of fast cash.
As far as why investors jump into these things, first many have the money to lose. They know the risk level and this is just play money at the casino for them.
Secondly have you SEEN the crap with horrible financials that people will invest in, in the modern market, just because whatever the company makes fancies the investors? They’ll convince themselves that profits are “just one more year away” right into the bankruptcy where only the Founder’s shares are paid back by the buy out deal.
The new company could send them a 5% off coupon on the product and they’d be happy they lost money on the whole thing.
And even institutional investors buy these garbage companies. The “safety” of mutual funds is a lie if they do, too.
Watch carefully what your fund managers buy. They are desperate for growth numbers and they’ll pick any old valueless crap to stuff your portfolio with. Stuff that selling off the assets won’t even pay back single digit percentages of the investors.
Some are banking on popularity to force the government into more free loans/bailouts in certain sectors. There’s less and less connection to the balance sheets when they’re digging hard for growth that may or may not happen buying the stocks of companies that are flat out bankrupt already on the books.
“Someone will come save them. They’re too popular to die.”
Not really a thing much in aviation outside of airliner manufacturing, but in other sectors? Whoooo boy. Lots of bankruptcies awaiting the next market downturn outside of the traditional “value” investors.
The only good news is, we’ve completely proven that the majority of the masses of fund managers don’t beat index funds in the long term. We can all get smashed or profit together. And the market is so stuffed with retirement money that can’t be easily withdrawn, we all will.
Losers won’t always lose anymore, because Congress has to act when Dad and Mom’s retirement money is at stake and Congress themselves made it impossible to exit. (Well, investors could move to cash inside retirement vehicles but most aren’t that investment savvy.)
Incentives to retirement savings come with an unwritten mandate to not allow anything but mass volatility. Large cap volatiles in a particular sector are rescued. GM should be dead. AIG should be dead. Numerous banks should be dead (Wells Fargo many times over for their criminal culture...), etc.
Lehmann was the last one they put out to pasture the old fashioned way, forced liquidation with a gun to their heads. Oh a few small banks also got that treatment, but in terms of big well known names...
After that, the rules changed. Popularity beats balance sheets now. Profit isn’t always required as long as the product is popular. Or seen as necessary.
Not sure we’re close to being back to no-income-proof mortgages yet, but we’re happy to go the other direction... any income approved for a mortgage you can’t possibly pay back in any reasonable time that’s way above 25% of take home. Just make the number bigger if you can’t make the pool of customers bigger.
Chosen as an example of product popularity and pushing margins as tight as possible, even requiring government guarantees up front along with private insurance paid by every non-conforming loan customer but in some cases, throughout the life of the loan, even if it becomes conforming by being laid down or housing prices rising causing equity to rise.
Standard P&L math was never the whole story of a company, but it’s become less and less valued by a great many. It’s very rare for anyone touting value investing to be seen talking about it much in air time on outlets like CNBC, etc... as compared to a couple of decades ago. They’re considered “stodgy”.
Most of these companies will never make a dime for most of their investors, but they keep going by promoting the "scale opportunity". 
