Per @kodo's discussion with Gargron, a person's posts only make it to the federated timeline if someone on your instance is following that person. IMO this is a design flaw — it encourages centralization on one big instance (so that you can see entire conversations and find new people easily) even more than it encourages cross-instance links.
For me this is even more of a value-killer than not being able to bring your followers with you from instance to instance (and ironically if the latter were possible it would help with the former).
@sonya it would, yes - but I guess "small steps". ;)