The thing is the idealised situation never actually exists. Let's say a developer builds a product that brings in $10m a year. How much do you pay them? You need to factor in that actually 10 designers, artists and product managers also contributed to the design and functioning of the product. Then there's the 5 people in IT support, 2 in QA, 3 in customer support, the office staff and security, the finance people, payroll, marketing, distribution, etc. Maybe it actually costs $7m a year to run all of that.

So you pay them $3m a year? Now there's zero profit, so nothing to invest in expanding the team, improving your services services, hiring more developers, growing the businesses, funding new projects for that developer and all the other employees to work on. Oh, by the way you owe $20m to your investors that put down the capital to get the business off the ground in the first place. How are you going to pay them back? Also, maybe you could have hired another developer and they might have done just as good a job, which is also true of everyone else in the business.

Finally, if you do up the pay of the developer say $1m a year, what happens if the product gets eclipsed in the market or the developer moves on to another product nowhere near as profitable. Now they're working on something bringing in a lot less, but they're still costing you a million a year.