Why do people pay for professors who have never built a company before to instruct them on business?

I think this is more generally a problem related to the current education industry. You're not paying for the knowledge - which you can get much more efficiently at much more other places much more cheaper - but rather about the 'credentials'.

Finishing an education program tells the world you're fit to perform relatively well in most parts of the economy. As such, not having finished any form of formal education flags the opposite to people; unfit for work.

Having a degree apparently is one of the easiest carved out paths through life, which is why professors are being paid to talk about something they have not even had any firsthand experience with.