As far as I can see, they "embraced" their own protocol and now "extend" it by building open source products on top[1]. Would love to see Microsoft do that kind of "extend". :)
New Vector (the company behind Element) is building tools on the matrix protocol. And making a business out of it. Which is good. It shows the world tools that can be built on the matrix protocol. More people get involved and newer tools emerge.
+1 for sustainable open source development. I think I've seen three paths:
1. The employee who has the blessing of the company to work on a side project during some work hours.
2. The developer who does contracting to keep a passion project afloat.
3. The developers who organize a company and try to invent business cases while keeping the core free and open.
Out of these, I feel (3) has the most possibilities. E.g. ability to focus, or if you happen to stumble on a great contributor, you can offer them a job. I don't see how this could be worse than the alternatives.