A central principal of the fediverse is decentralization, and to that end, it's healthier to spread the users across many instances than to have folks concentrated too heavily on any one.

It's certainly healthier for the whole to have users spread across instances, but that's a matter of emergence. What's your pitch to convince an individual to choose a smaller instance, when it's far more likely that their instance will cease to exist, taking their identity, history and hosted communities with it?