Reading what the city councilmembers say, this sounds pretty reasonable to me:

"But the six other councilmembers voted that idea down. Bruce Harrell, who voted last month in favor of the 150-cap, said that the city’s vision in the coming years is to remove caps and let consumer choice “dictate what’s out there.” But for now, the approved legislation lets TNCs operate legally in Seattle with oversight."

That's hardly the "stop all innovation" position that this VC is lampooning them as having.