I think I am being fair. The numbers $500k/$500k were picked arbitrarily to demonstrate how it would kill a business. If you were at $500k/$400k you would be similarly dead. "back then", $500k/$500k was enough to stay afloat. Now you "just" need to be at $500k/$600k, that's all. ie, your revenue needs to be somewhat higher (20% I guess? too lazy to math it) to pay the taxes. Assuming the business stays afloat, you'll eventually break even on the taxes, it's not forever lost like paying AMT for stock options that never become liquid, or RSUs that go well underwater before a lockup expires.

It does suck that a quirk in accounting means you were profitable on the books, no question there. But it "just" means you can't run so close to the bone. I don't think it's the world ender everyone is making it out to be. It means you need more operating capital up front.