If you're planning a concert you'll be selling tickets for, you want it to sell out; short of that, you want it to look sold out; and short of that, you want it to look full.
A half-empty venue is a something of a downer for everyone -- the band, the audience, and, of course, you. But if you're a relative novice at hosting these types of events, or if you choose to feature an act that doesn't already have a huge following, selling a huge number of tickets can be tough. The easiest way to avoid this type of downer is to book a small venue. Sell out a 200-person show first, and then set your sights higher.
Other venue considerations include acoustics, on-staff sound engineers if you don't want to find your own and price. There's no point in renting an extra-impressive space if it means you have no money left for an extra-impressive show.
Next, if the venue isn't fully equipped ...