It may be that the industry has evolved to a degree that this is no longer viable (I also don’t know if I believe this…), but invite-only or otherwise limited launches formed the backbone of the current web.

Facebook was only available if you had a school address. Gmail was only available via invite. Obviously a service can’t stay in a limited state forever and the hype will run out, but it’s not exactly a new approach to limiting access early in the life of a service.

Google+ failed because Google killed it. I never experienced what you describe, but admittedly got an invite very early, and interacted with people who had also gotten the same thing.

Limiting onboarding does not eliminate the network. It just limits it. Again, to your point, this can’t last forever, but is not by itself the issue as long as they continue to scale up access. There are plenty of other issues that will make or break a network.