Any business grows if their k-factor is greater than 1. This is true for any business.
Definition of k-factor is the number of people that organically become customers for every given current customer. Example: If 10 people come to your business and 1/10 refer 1 customer, you have a k factor of 1.1.
Mostly because in any given market, some company will have high k factors and some will have low ones. The ones with high ones can raise and deploy more capital into other things like new products, higher wages to attract better talent, etc. The ones with low ones will need to buy each user to sustain growth (through sales and marketing), leaving less room for those other investments. Eventually this catches up to them and they decline.
Making sure your business has is such that for each customer you get, you will get >1 customer long term is crucial for success!