LinkedIn·Tuesday, 30 June 2026·30 Jun 2026
SUPERLINEAR GROWTH: HOW SERVICE FIRMS CHANGE INTO VC MAGNETS For years, the logic of venture capital was crystal clear: invest in software…
Omar Mohout
Partnering with Tech Scaleups to secure funding, drive acquisitions, and achieve growth
SUPERLINEAR GROWTH: HOW SERVICE FIRMS CHANGE INTO VC MAGNETS
For years, the logic of venture capital was crystal clear: invest in software companies, because software scales with minimal marginal costs. I have preached it for decades myself: if it's not software, it doesn't scale. The exponential growth curve of the startup became the holy grail - and service firms, which needed extra people for every additional project, were left behind
Exponential growth is doubling on doubling, a hockey stick that goes almost vertical. But superlinear growth is something more subtle and, for service firms, far more relevant. In superlinear growth, output rises faster than input - not infinitely fast, but significantly faster than linear
AI enables superlinear growth in professional services by decoupling output from headcount, as demonstrated by a 50-lawyer firm increasing capacity from 500 to 900 cases a year through automated analysis & drafting. This shift, driven by AI's acceleration of intellectual labor, mirrors the impact of the steam engine on physical production by breaking the linear relationship between input & value creation
AI has crossed the threshold where it can handle much intellectual work autonomously. The more complex & valuable the knowledge your employees apply, the more leverage AI offers. An accountant preparing tax returns gains less than I am, an M&A advisor analyzing deal structures - but we both gain significantly
In a traditional service company, personnel costs are 60-80% of total costs. Growth means hiring & margins come under pressure. With AI as operational backbone, that equation changes. Employees produce a multiple of value. This changes not only productivity, but also margin structure, speed & capital efficiency. Organizations can grow faster without building the same management layers, overhead & operational friction. The result is striking: service firms suddenly see margins that until recently were only reserved for software - heading toward 70%. And that is precisely the margin structure that investors have only found in software companies for decades, and which they are now beginning to recognize in AI-driven service firms
Belgium, with its strong service sector and thriving tech ecosystem, has unique assets to embrace this shift. Moreover, superlinear efficiency is an answer to the structural shortage in the labor market
The companies that realize superlinear growth have one thing in common: they have stopped seeing themselves as a collection of people performing tasks. They see themselves as a system of combined human and machine intelligence - that learns, optimizes and accelerates. They are the companies that will attract the attention of capital. Not because they are startups. But because they have customer relationships, sector knowledge and trust that took years to build.
The question is simple: are you building a company that adds up, or a company that multiplies?
Read my full column in Forbes Belgium
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