VO is the ticker for the Vanguard Mid-Cap ETF - https://personal.vanguard.com/us/funds/snapshot?FundId=0939&...

The Sharpe ratio is a measure of the Risk/Return for a given investment - http://www.investopedia.com/terms/s/sharperatio.asp

I think he's saying that investing in smaller (small-cap) companies is a better idea because it's easier for a small company to grow 10x in the next 20yrs than IBM to grow 10x in 20yrs.