What is important is having had the wherewithall to get to where you are. Now what do you do with that knowledge? Finding VC money isn't necessarily the way to go. In fact, it's rarely the way to go unless Stress is something you just can't do without.
The fact that someone else (SquareUp) has beaten you to market is irrelevant. Square isn't out of the woods yet.... Visa, for example will have something to say about it. Their reader is also not unique, and iPhones will all have the capacity to read cards, without external gadgets.
IMHO, you should go after an "alliance" with someone in the financial transaction business. It's not an easy game to play in, as one your posters has pointed out. I'm not in that business but can help you find someone on that front. And no, I don't want anything for the help, but I've been an entrepreneur and sometimes when you're in the trenches, you can't see the forest, not because of the trees, but because the muck and mud are up to your eyebrows. :-) jdebar AT telus.net
And good luck giving air to your entrepreneurial spirit.