Companies in this space are also in an arms race where there are very finite amounts of scalable channels. (Scalable means, in this instance, any way they can convert money into customers in a predictable fashion.) One would naturally expect that the channels largely go to whomever is interested in investing most in acquiring them. However, since many of the participants in the auction (some channels, like AdWords, are more-or-less literally auctions) have extra-economic reasons to prefer growing, often the auction's clearing price will be non-profitable.
Or, to put it another way: the marketing company which has done best from the investment in marketing companies is Google. (Second best, probably "sales guys." Successful sales reps at enterprise firms are some of the best compensated people in software.)
That's what's interesting about this "arms race" to acquire customers: when startups aren't worried about profits, CAC can be arbitrary ("because we'll make it back later!").
The bi-product of all this is exactly as you describe: startups are artificially driving up the cost of AdWords (and maybe other channels, like salespeople).
Big brands do the same thing. Terms like "Diamond Ring" can't be profitable online since the big brands are willing to lose money to make sure they keep brand equity.
"Companies in this space are also in an arms race where there are very finite amounts of scalable channels. (Scalable means, in this instance, any way they can convert money into customers in a predictable fashion.)"
Just wanted to say - a very smart comment - and something that most people and frankly even VCs don't seem to get: that what works at $5m in bookings won't likely scale to $25m in bookings. This is why you see so many companies moving up to selling to the "Enterprise" - the Adwords driven, low-touch sales approach may scale for a handful of companies who were early and in extremely horizontal business - but for most more niche SaaS offerings, the writing is on the wall - that approach will get you only so far.
Or, to put it another way: the marketing company which has done best from the investment in marketing companies is Google. (Second best, probably "sales guys." Successful sales reps at enterprise firms are some of the best compensated people in software.)