Some of the things to be considered are:
- Capitalization Risk - how long will current capital last with projected sales? Can you get to cash flow neutral before the current cash runs out? How close will you have to cut it? What if you do a lower revenue number than projected? When do you run out of cash in the worst case scenario? Will you need to lay people off? How will that affect morale?
- Dillution - What will your likely pre-money be (you'll need to do some comparisons by talking to other local entrepeneurs as well as banks and attorneys to get some idea of what the market will bear). Does the dillution to the current shareholders seem to be a reasonable trade-off for reducing capitalization risk?
- Opportunity Cost - Are forces mounting that require you to accelerate some portion of your business: product development, business development, sales? Perhaps you don't have time to grow organically. Is competition increasing or the market heating up to the point you need to hire up personnel to capture more market share and support the onslaught of new customers? If so, you might want to take in more cash. New investors will also bring new networks with them that should be able to accelerate some aspect of the business.
- Terms of Financing - You may find that current financing terms are too oppressive. In addition to the dillution, this might include: liquidation preferences, loss of control of the board, management changes required, or reverse vesting of founder shares.