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Why Is Iterative Development Important

 
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I was asked this question: "why is iterative development important?" I only know that incremental and iterative development is to minimized risks. What else can I elaborate on the importance of iterative development?
 
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Here's some points, although they are mostly benefits of incremental development, not just iterative:
- Early customer feedback
- Incremental releases allow the customer to use the software in production earlier, if he wants to
- Having the knowledge of prior iterations makes estimates and designs more accurate than in BDUF
- The whole process is exercised from start to finish, thus revealing any problems early in the project
 
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