Hey Dave–Amusing to see you are spending your morning going around to various blog posts pointing out that I forget 8th grade math; you’d probably find it even funnier if you saw me trying to remember 9th grade calculus ;> You wouldn’t believe it, but I actually was on my high school math team, so I think my problem might be premature Alzheimers…

More seriously, though, your point that past a certain point the slope flattens is important. Bob M and I noodled this at length the other day, and we’d even take it a step further: in some instances, such as a social network, the value can actually DECREASE past a certain size, unless the network provides features to enable more nuanced connections that take into account things like affinity and sub-communities of interest.

I think the limitations he refers to are critical for investors and entrepreneurs to look at. It doesn’t increase at n-squared forever – only up to a point. Understanding where this point is for your particular application is crucial to the economics.