CloudFlare was launched as a stupid-simple CDN, but DDoS mitigation and bot reduction are actually valuable features for many websites. Sure, CF isn't the only business in this space, but most of their rivals are large enough to be in the S&P500 / Russell 2000, so it's not like garage startups are competing for this business.
"Was meant to be"
This isn't a law of physics. This was a starry-eyed hope by techno-utopians and academics when the internet was still 100% funded by Uncle Sam. When the internet moved out of its parents' basement, it had to grow up and get a job to pay the bills. Some people are fine with a SquareSpace webpage instead of running their own custom Apache httpd website on bare metal in a colo like it's 2005. The cost of maintenance and cognitive load is a cost we shouldn't ignore.
It turns out that economies of scale exist. The Internet doesn't need 10,000 small CDNs and they would all be inefficient and expensive if that was the distribution. Instead, there are a few large ones that can afford to colo in many geographically dispersed data centers and who negotiated bandwidth peering contracts for advantageous pricing.