Can talking to corporate development be a huge distraction? Sure. But talking to investors can be a huge distraction as well, and a lot of the things that PG writes about corporate development folks are true of investors. Is PG next going to suggest that startups avoid the Sand Hill Road dog and pony show? I don't think so.
Broadly-speaking, investors today are overvauling startups. Seven figure valuations and ridiculous convertible deals are being handed out like candy to early-stage companies with way more potential than proof. It's a hot market and investors want dealflow, so they're not quibbling. There's also a greater fool dynamic at play.
This in turn leads founders to believe that their companies are worth more than they really are. In many cases, the "surprisingly low" acquisition offers these companies might receive are only "surprisingly low" when viewed through the lens of the angel and VC environment. On their own, they might be quite reasonable.
The big challenge for founders is that a high valuation can be a friend made enemy. It's great to raise a bunch of cash on favorable terms, but lots of companies will eventually fail to live up to their valuations. Once your valuation reaches a certain point and the structure of investments is more complex (liquidity preferences, etc.), founders can easily find themselves in a no-win situation even with a moderately successful business.
As they say, a bird in the hand is worth two in the bush. This post seems intended to get founders to forget this.