For an entrepreneur who set out to fix a problem in the world, it can feel very wrong not to give customers the solution that you know you can give them, for mere capital reasons.

There is nothing wrong with it, but it's hard to do skillfully, especially in the chaos generated by rapid growth, and you may not realize the need until you're already trapped by your existing commitments. Good relationships in the company can fall apart in the decision-making, too (e.g. if someone's personal/career growth path is cut off by the decision to stop pursing something that's been built towards for years.)

Some types of businesses can do it more easily than others. Professional services can probably do it the easiest. A B2C business with a turnkey offering could have a lot of trouble paring back, especially if the product has a physical aspect.