You certainly do lose a lot of features, but you still have the advantages of offering users a somewhat familiar platform (they’re likely familiar with Reddit already), and all of the third-party apps we have for Lemmy already. So even though you could just as well host a Facebook group or a phpBB forum or whatever, it’d probably prefer that as a student because I can log into my favorite app and use it seamlessly. And a single-node instance like that would be very privacy friendly as well. So if OP wants user engagement in a private platform it’s not as bad of an idea as it seems, even though without federation you’re not getting the most of it.