If too many malware or scam apps make it onto the store, people won't trust the store anymore and the whole thing is ruined. So you have to vet every release version of every app or enough bad stuff will slip through that the users will leave.

Pretty soon people will start complaining about arbitrary rejections so you need to start documenting a system of rules and applying them consistently. If you don't do that, the developers will leave. Even if you do it, the developers might still leave unless being in your store is worth the hassle of obeying all of the rules.

Then some parents will complain that their kid spent a lot of their money buying stuff in an online game or spent time chatting with a pervert and it's your fault because the app came from your store. You might need to spend a lot of money on lawyers and PR people to get out of that one.

Most of these problems are nontechnical -- they are really people problems. It's hard to see how such a small company can run an app store that can be trusted by users and app developers unless it handles a very small volume of apps.