This post reminds me of a post I made a while ago called Don't Raise Venture Capital.
http://www.startable.com/2008/09/26/dont-raise-venture-capit...
This may seem a bit odd, as I am a VC. My point was not 100% aligned with Paul's, as he's suggesting something a bit more extreme, but there is a similar point - these days you can build a good business without significant funding. And you are potentially better off not raising any venture capital. Although I hope the venture business hasn’t become totally obsolete, as I really enjoy spending time with entrepreneurs!!