I think it comes down to the decision between potentially having a large piece of a smaller pie or a small piece of a massive pie. Taking external funding is a

I think it comes down to the decision between potentially having a large piece of a smaller pie or a small piece of a massive pie. Taking external funding is akin to leveraging up to build a portfolio -- your return on investment is magnified. However, as others have mentioned, risk is mitigated because losses are absorbed by the investors. Plus, you'd want your well-connected partners to have skin in the game as an incentive to help the company (although that can be at odds with the founders when VCs go into stop-loss mode).