It matters if the pre-money valuation at which the new shares are issued is inaccurate.

You own 10% of a company that was valued in the last round of funding at 10 million dollars. You have put in significant amount of work since and company has raised a lot more revenue. The fair market value is now at a 100 million dollars, but the existing shareholders put in another 90 million dollars at the same pre-money valuation as last round, diluting every existing share down by 90%. Congrats you now own only 1% of the company and just got robbed of over 8 million dollars. (Fair value of your stock went from 10% of 100 million = 10 million to 1% of 190 million = 1.9 million).