If it was much higher than what they ultimately spent on reproducing the product, then yes, "insanely high amount" might actually be an appropriate assessment.
Considering the "for what they were building." I assume that was the poster's thinking. On the other hand, there is value in acquihiring people who can see a need in your product you overlook and want to make it better. Sure, that feature was cheaper, but that's not all you buy.