Why do 24/7 hotels cancel prepaid reservations if you arrive after the latest check-in time?

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I’m booking a 1-night stay at a hotel and paid $100 in advance online. If my travel is late and I arrive after 1 AM I cannot check-in even though I paid until 12 PM (11 hours later)!

In: Culture
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Can’t check in, or they assumed you no showed and canceled the reservation?

Because they want to rent the room to someone else. Yeah it’s cool to have your $100 and keep it, but it’s even cooler to keep your $100 AND get $100 from me too.

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ELI5 is not for asking about a business’ or group’s motivation. Why a business or other group of people choose to do or not do something is often a fact known only to that group of people. Everyone else can only speculate.