In the early Church of Christ founded by His apostles after the Resurrection, the members met in small groups in the homes of the members. In the early Church restored through the Prophet Joseph Smith, this was also the case. Why was that? Was it due to poverty, the inability to afford meeting houses?
There is much to be said for continuing to meet in small fellowships even after the Church became large with many affluent members. One is that tithing money can be used to aid the poor rather than be spent on elaborate church buildings. Another reason is that the head elder of a fellowship is also more familiar with the needs of the few families in the group, so that offerings for the needy can be dispersed more effectively.
When a fellowship grows too large to meet in one home, it can be divided such that the responsibilities, friendships, needs of the poor, and maturity in the gospel are all considered so that both new fellowships can grow and thrive.