I'm not sure where along the line IPOs changed from "profitable company raises money from the public" to "private investors parachute out and dump their losses on Joe Schmuck".
Private investors "parachute out" only 20% of their stake in an IPO to investors who willingly buy into the story because they believe (rightly or wrongly) in the upside.
It's not exactly like Joe Schmuck is unwillingly forced to hold on a hot potato
But the underlying point is that the markets are disconnected from reality, and - fair play to them - the VCs are capitalizing on it.
One day I'll actually set aside a few hours to go through a list of all tech companies that IPO'd in the last 5 years, and see which ones have actually made a profit. Gut feeling is that the "flashy" ones are still burning through cash reserves (Asana/Slack/Uber), but the more boring ones (Rackspace/Pivotal/etc) are probably sitting pretty.
You might find site helpful. https://postipononprofits.com/
This is outdated a bit in terms of numbers (doesn’t include recent years and excludes many companies), but the broad point remains. You are right, there are ton of companies built around the idea of dumping it on someone else before turning a profit. This has become the ‘formula’ for building companies, unfortunately.