> it makes absolute sense for a B2B entity to be present at trade shows
It may make sense for some B2B entities to be present at trade shows but the article is talking about early-stage companies buying trade show sponsorships. Depending on how you interpret "early-stage", I'd argue that this article is wholly accurate -- there likely is a smarter way to spend that $5,000. However, at some point you cross a line where your product is ready for the next growth stage and that $5,000 is well spent at $X Conference. At that point, $X Conference is part of your larger marketing strategy, also pointed out in the article.
The original article is completely wrong on this point.
Maybe some startups sponsor but don't attend? That would be foolish.
Alternatively, spending any money on marketing before you have anything customers can actually buy or use or trial would be foolish.
But if you've got something even a little bit useful that's ready for people to try, and you plan to attend the conference, that $5,000 is a smoking deal!!!
5000 for a booth is a bargain even for really obscure trade shows, and it makes absolute sense for a B2B entity to be present at trade shows.