Could in theory is very different from what actually happens.
In the end the purists approach results in better more productive software across even slightly longer timescales. That ultimately produces more value and thus a richer society than the kind of short term pump and dump schemes which SV is so fond of. Who captures that value is a different story than was that value created.
yeah, I think ~all of open-source-funding-history stands as evidence opposed to #2, a la https://xkcd.com/2347/