By making something private, IMO you're revoking its status as an inherent right, and restricting access to only those who can afford it.
IMO the primary issue with this specifically venture funded stuff is that it'll undercut the competition for as long as possible, and then hike the prices once the competition has ceased to exist. When other recurring sources of funding are available, as it usually is with public services, this kind of thing is much less of an issue