The bubble argument was hard to wrap my head around

It sounded vaguely like the broken window fallacy- a broken window creating “work”

Is the value of bubbles in the trying out new products/ideas and pulling funds from unsuspecting bag holders?

Otherwise it sounds like a huge destruction of stakeholder value - but that seems to be how venture funding works

The usual argument is the investment creates value beyond that captured by the investors so society is better off. Like investors spend $10 bn building the internet and only get $9 bn back but things like Wikipedia have a value to society >$1 bn.