Founders are worried about losing to competitors who raised more money. In actuality I’ve only seen counter-examples:

Tensor beat magic Eden with 2 orders of mag less $.

Solana beat other L1s with 2 order of mag less.

Jupiter raised 0, all VCs passed.

Less money = more sense of urgency more chip on the shoulder.

Worked at a web3 startup that was complete overfunded. They spent more on rebranding and event sponsorships than actually building. Too much money means you lose focus and forget the important part - building something useful for customers