Babies are created inside their mothers and have to exit at some point. Depending on the animal, thats either an egg or a breathing creature.
Genetics determines how big an animal can get and evolution reinforces that bigger/stronger animals tend to survive long enough to procreate. The size of the animal is dictated by the environment. Small animals can fill a niche, but often die sooner than bigger species.
Therefore, being able to be birthed without killing the mother and surviving long enough to pass on your genes results in small babies, but big adults.
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