How do you explain Microsoft's recent purchase of Mojang or Facebook's $19B purchase of WhatsApp?
It absolutely does happen, but it's lottery. Most little companies that try to introduce some new cool product fail. A minority stumble along barely making it for a few years. A tiny tiny number get the attention of The Big Boys and get bought out with The Big Boys' monstrous piles of cash.
And often, there's no significant tech or product being acquired. They're buying what's popular because of its popularity hoping they can somehow turn that into even more monstrous piles of cash.
But Microsoft and Facebook and Apple continue to make almost all their money from their organically grown businesses and very little from their acquisitions.