They're based on constant growth. I guess over a long enough time frame, constant growth is exponential, but not in the windows that an investor expects to be paid back.
Exponential growth is only expected in software because the development costs are so high and the marginal costs are so low. There's zero cost to growth, which makes it a winner-take-all market.
Exponential growth is also expected within new businesses within an established corporation. Similar to software's margins and distribution advantage, an existing corporation can often pursue new businesses with an existing infrastructure that approaches minimal additional expense beyond human salaries. The reference to "hurdle rate" is an often used term by corporate MBAs evaluating the worth of a new line of business.
Exponential growth is only expected in software because the development costs are so high and the marginal costs are so low. There's zero cost to growth, which makes it a winner-take-all market.