Every new inflow of money or issuance of stock in return for contribution in kind dilutes the stake of existing holders. If someone owned 8% before the deal, after the deal they own 6%.

But, dilution is not always bad (or toxic). There are two kinds:

Bad: The contribution (cash or in kind) is wasted: the company does not grow in capacity, revenue, or profit. The asset owned by each investor shrinks.

Good: The reverse is true and the asset owned by each investor grows.

Example: the 6% stake is now worth $1,000,000, whereas the previously held 8% was worth only $200,000.

I welcome dilution if what we get is enough to increase the value of the company so that my stake grows in value by more (much more, I hope) than necessary to compensate for the dilution. I'd rather own 1% of something worth $100,000,000 than 99% of something worth $100,000.