In another episode of the "Google is the new Microsoft" meme, I've been amused to see some VCs brag about how they plan to not invest in any company that potentially competes with Google in any space. Below are two examples I've noticed so far, I'm sure there are more that I've missed

In his blog post entitled The Kiko Affair, Paul Graham writes

Google may be even more dangerous than Microsoft, because unlike Microsoft it's the favorite of technically minded users. When Microsoft launched an application to compete with yours, the first users they'd get would alway be the least sophisticated-- the ones who just used whatever happened to be already installed on their computer. But a startup that tries to compete with Google will have to fight for the early adopters that startups can ordinarily treat as their birthright.
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The best solution for most startup founders would probably be to stay out of Google's way. The good news is, Google's way is narrower than most people realize. So far Google only seems to be good at building things for which Google employees are the canonical users. That's because they develop software by using their own employees as their beta users
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They tried hard; they made something good; they just happened to get hit by a stray bullet. Ok, so try again. Y Combinator funded their new idea yesterday. And this one is not the sort of thing Google employees would be using at work. In fact, it's probably the most outrageous startup idea I've ever heard. It's good to see those two haven't lost their appetite for risk.

In his blog post entitled Thoughts on Google Apps, Paul Kedrosky writes

Finally, and this is mostly directed at people sending "Enterprise 2.0" business plans my way: If you're thinking of doing something squarely in Google's enterprise-lusting aim you need to ask yourself one question only: Why? What makes you think that you can do it so much better than Google can that the inevitable free Google Apps product doesn't kick your ass out of the office market? I'm not saying it's impossible, and there are plenty of things outside Google's aim -- including apps that are much more social by design than what Google builds -- but the gate is 99% closed for bringing vanilla,mass-market office apps to the web.

I guess these VCs are planning to stop investing in software companies since Google seems to be increasingly involved in almost every category of software products. I thought the entire point of being a VC was accepting the element of risk involved?