It doesn't matter if many companies have defected from ALEC's folds. It doesn't matter if many state legislators defect, either. It doesn't take many people to write a law. The trouble is that many voters don't understand the bylaws (constitution and the supporting laws), don't trust the people they elect to public office, and balk at paying the bills. On the other hand, many voters put far too much trust in the "rock stars" of the political world, many of whom don't have enough training or brains to manage a dog pound.
The biggest difference between a democratic government and a successful corporation is the quality of its management, employees, products, and services. In a democracy, voters elect their own "volunteer" legislators and governor. Citizens are not required to vote, but are required to invest (via their taxes) in their government anyway.
In a corporation, a professional board of directors calls all the shots, and shareholders invest voluntarily only if they like the corporation's business model, management, record, and potential. Voting by shareholders is optional as well.
A stupid shareholder has a far better chance of making a successful investment than a stupid voter does because big and small corporate investors all have the same goal. Rich citizens don't always have the same goals as poor citizens, and the rich can rule by persuasion, graft, and deception. Also, buying and selling stock is far easier than moving from one state to another, and one corporate shareholder's success does not depend on how smart or lucky other shareholders are.
A "corporatocracy" could be okay if a majority of the voting shareholders were smarter and could learn from their mistakes. A democracy is like toothpaste: once out of the tube, it is nearly impossible to put it back in.