Or, a possibly much simpler answer: Projects that require large teams are larger, and thus more complicated and difficult. More difficult projects fail more of

Or, a possibly much simpler answer: Projects that require large teams are larger, and thus more complicated and difficult. More difficult projects fail more often. Artificially shrinking the size of the team without reducing the scope and complexity of the project will rarely improve its chances (unless the team size was only an effect of beaurocracy, and you manage to only kick off the people who aren't contributing).