In aggregate, startups certainly do create wealth. (So do other types of companies.) Certainly not every startup creates value. Perhaps even most don't.[1] But some startups generate a massive amount of wealth. (Apple for instance, or Google, or Tesla, to give a few hopefully non-controversial examples. We are better off as a society for these companies having been started.) And the ones that don't create wealth don't tend to destroy much either. It's not like investment funds are just torched. They go to purchasing materials, paying employees, etc. For the most part these actions simply redistribute wealth, rather than destroying it. Therefore it seems clear that, in aggregate, startups create wealth.
I suppose one could argue that more wealth would be created if everyone went to work for large, established companies, or started lifestyle businesses, rather than starting startups. At the very least it would be more difficult to disprove that assertion, but using the same logic as above it seems unlikely to be true. For all we're immersed in startup culture here, the number and people and amount of capital focused on startups is still small relative to the rest of the economy, and yet the benefits we've seen from just a few high-profile ones, let alone the smaller benefits accrued by many others, are very significant.
[1] Although, just because a startup "fails" does not mean that it has not created wealth during its existence. Obviously any time two people voluntarily make some sort of exchange (absent mistakes), wealth is created. IE, both people are necessarily better off than they would have been otherwise, else they would not have made the exchange. So it is very possible for a startup to create wealth on the way to shutting down.
I suppose one could argue that more wealth would be created if everyone went to work for large, established companies, or started lifestyle businesses, rather than starting startups. At the very least it would be more difficult to disprove that assertion, but using the same logic as above it seems unlikely to be true. For all we're immersed in startup culture here, the number and people and amount of capital focused on startups is still small relative to the rest of the economy, and yet the benefits we've seen from just a few high-profile ones, let alone the smaller benefits accrued by many others, are very significant.
[1] Although, just because a startup "fails" does not mean that it has not created wealth during its existence. Obviously any time two people voluntarily make some sort of exchange (absent mistakes), wealth is created. IE, both people are necessarily better off than they would have been otherwise, else they would not have made the exchange. So it is very possible for a startup to create wealth on the way to shutting down.