They were still dumb, they just got lucky. When you have enough money to throw shit and see what sticks, you don't need to be smart and pick winners. That's the whole crux of why people don't respect VC.
Lucky?
They were desperately buying anything they could on the secondary markets. That isn't luck, it's seeing an opportunity.
It's like Pinterest 2 or 3 years ago (say around the time of the 27M A16Z B round). Putting as much money into that as you could isn't being lucky, it's seeing an opportunity. Their 2014 and 2015 rounds are basically just ways to print money.
That's the whole crux of why people don't respect VC.
Um. Some people don't respect some VCs. I don't agree with everything Marc Andreessen says, but I'd be pretty silly if I didn't respect his opinion on technology.
The trajectory was clear enough that all those investors DHH called "star struck" put money in.
To quote him: Irrational investor exuberance indeed. I think it would be more sensible to class them as "investors who had more foresight than DHH".
He berated them for being dumb. Since we can now see that they weren't dumb at all we should consider DHH's insights questionable.