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That is not a proportional system of representation.
No system that creates a large amount of election "losers" can ever be fully democratic. If you vote for the second most popular party, or the third most popular, et cetera, you should still be given representation.
If you don't meet the minimum support threshold you do not get representation.
The "minimum support threshold" for Germany's MMP voting system is 1% of the voters. Without even taking things like gerrymandering and strategic voting into account, the threshold for a first-past-the-post system like in the U.S. is often well over 40% of the voters. An absurd difference.
Sure, MMP is not perfect. No system is. But it's extremely much better than FPTP.