Economies of scale come into play when the increases in revenue are outpacing the increasing in spending. This is best shown with fixed costs. If you pay $10,

Economies of scale come into play when the increases in revenue are outpacing the increasing in spending. This is best shown with fixed costs. If you pay $10,000/month for office space and sell 10 widgets or 100,000 widgets, you're still paying for the same amount of office space. So it's always beneficial to scale so long as your fixed costs aren't increasing enough to override the benefits. It could be that PG meant that large corporations were more willing to take these bets as they had less to lose than a small company. Taking advantage of economies of scale will generally require some investment upfront as well as adding something to your fixed costs (building a new plant for example). If things don't pan out, you're left with the new expeneses, debt, etc. The financing gap between big companies and small companies has shrunk a lot of the years. During the times that PG is talking about, a small company would have difficult time getting the same amount of financing as a large company in a comparable amount of time. I doubt a small company back then could scale at 10% of the speed that a small company could now.