You are either arguing a strawman or are intentionally distorting what I said.
My argument is that venture-capital has enabled Element to snatch away the little sustainable funding that exists in the open-source messenger space and this directly reflects in the not great state of the remaining fully hobbyist developed clients for XMPP. However, the same time Element spectacularly failed at using these funds to actually create a competitive system thus in the end they poisoned the well and burned a lot of money. This is a common pattern of venture-capital funded endeavours that was easy to see coming but Element prioritized short term gains over their stated goals.