Fun piece (in PDF format) by Joel Spolsky about why you may think you need venture capital, but you don’t. Yes, he creates something of a straw man that he then beats mercilessly, but it is fun to watch — and he does make some fair points about the differing goals of VCs and entrepreneurial CEOs (from timing, to risk preferences, to the desired return). As Joel says, those differences lead to tears more often than either side might like.
Now, does the preceding mean that software companies (the perspective from which Spolsky writes) never need venture capital? No, and I don’t think Spolsky would argue as much, but far be it from me to get in the way of a good rant.