Okay, what he says sounds plausible - I guess consulting is an example of a business with linear "resource efficiency". But he doesn't explain the faster than linear resource efficiency case very well. The obvious answer is a case where you get x% more customers per unit time then your effort on your product produces x% more value. Okay, so how do VC's identify businesses that will have X% growth in the number of users? Inform please.
Also, just a pedantic gripe, but someone should really inform this guy of the meaning of exponential growth. His definition that an "exponentially" growing firm the next million nets more value than the previous million would also apply to quadratic growth.
I'm sure he'd look at you blankly if you tried to tell him that. Innumeracy is embraced by business people. They made "All I Really Need to Know I Learned in Kindergarten" a best-seller.
A good businessman uses his numerical intuition far more than his numerical literacy - math is a way to prove intuition as it relates to business.
A good mathematician also operates in this way - a proof starts out as intuition. People with poor business/social/numerical intuition often point to this as a flaw, but it's really an advantage. That's why the best engineers eventually end up as business people. Look at the partner roster and board members of any top flight VC firm in the valley - a high proportion of them are former engineers.
You're not going to find many former accountants or statisticians in the bunch.
The graph is all vague and VC touchy-feely. If you re-label the axes revenue (which he discounts) and cost, you get something that the entrepreneur can use. Exponential or even quadratic growth is impossible over the long run. Linear growth in revenue where the slope is > 1 is the recipe for success. If you convert the graph to $ vs time, you see how long you have to hold on.
Also, just a pedantic gripe, but someone should really inform this guy of the meaning of exponential growth. His definition that an "exponentially" growing firm the next million nets more value than the previous million would also apply to quadratic growth.