Part of the problem in the dot com world is that the economics were (and in a lot of places, still are!) different: your funding comes "for free" via venture capital, and venture capital has different rules. The legal structure of venture capital funds is such that, if money comes back from an investment, it can't be plowed back into the fund: it must be returned to the original investors. So there's no reward for not spending all your money. Even though the investments came at a greater clip and at higher amounts[*], the spending became even more urgent. A first round was only meant to last 8 months; if you weren't done spending your first round, how could the next round come in at a higher valuation?
[*] I've done technology advising to the venture world since the late 80's; in 1989 it was a big deal to give someone $1M to try to make a good idea happen. When I last did this kind of work (just before they stopped bothering to ask about the technology, because that part was taking too long) in 1999, $5-7M for a stupid idea was common.
So the answer is: your competitors _are_ ... ;-)
/jordan