It's definitely not black and white.
I think of every opportunity as being a different dartboard with different values. These were just examples of _A_ small startup and _A_ big startup.
It's our responsibility as an entrepreneurs to pick the board that best fits our risk profiles for the best cost.
Not all boards have a positive EV.
The "use dad's connections to buy my product" startup board is just 1 big fat positive number (imagine some nearly "risk free" opportunity)
The "punch people in the nuts for a dollar" startup looks like a board of all zeros (as far as I know, most guys aren't interested in this service)
Why is the small board dotted with different values and the big board a vast wasteland with only a few potential outcomes? Is it VC pressure? That could definitely eliminate some options - however, if you intelligently take on capital and have the ability to hire better and brighter people - you should have more positive outcome possibilities.
I think the general idea is pretty sound, but definitely not so black and white. I believe most "big" startups were small startups initially.