You need the valuation for external uses. E.g. M&A or hiring (there are other ways to do this too).
In general, if you are not prototyping / proving something works, or scaling something that does work, you should not raise money.
One could argue that while too many SV/NY/cluster-based tech companies raise money, too few outside of major tech clusters do. In many cities and regions people bootstrap for too long, do not scale quickly enough, or do not think about time to winning in a big market. It is possible that non-cluster tech companies in the US end up scaling fast too infrequently.