VCs are a convenient abstract bogeyman. Yes, VCs do tend to encourage a grow big or go home mentality but it is, as you say, the founders who wanted that sort of investment.

It's also the case that, as soon as someone here suggests that a startup doesn't need to operate in that manner, someone--as certainly as the sun will rise in the east--will post Paul Graham's startup definition and argue that you're not a real startup without a growth-first mentality.