I had the same comment below. Does popularity make up for it being stupid in the first place? So, because someone can get rich, does it mean his idea was right?
Well, maybe in a business sense, the idea was not wrong if you could gather enough fools to back you up, but that does not make it less of a stupid idea.
How does one define a stupid or smart idea? Do I have to chip away at world hunger for my idea to be smart? Or do I have make a billion dollars for my idea to smart? The production of the iPhone has contributed to the suicide of a lot of people. Is the iPhone a stupid idea? On what scale of success does an idea have to achieve? If Groupon only made a select few rich at the expense of others, was a smart idea on the founders part, or not? Does the founder really care, or does he regret it?
Given all these factors, its clear you can't have an objectively stupid or smart idea. I think the only right questions you can ask are "How are you going to execute on it?" and decide whether or not the founder is stupid or not. I'm not sure there are many people on the planet who can, given the idea for Instagram, sell it for a billion dollars.
At the end of the day all you really have is your confidence in an idea, and confidence in the founder's ability to execute on it. Knowing whether or not an idea is stupid really requires a sort of omnipotence on your part. Was it the right time? Instagram would be a stupid idea in 1995. Did the founder execute well enough? Was the market too small? There are too many variables that go into deciding whether an idea is "stupid" or not.
Well, maybe in a business sense, the idea was not wrong if you could gather enough fools to back you up, but that does not make it less of a stupid idea.