We tested it with 100,000 ads on localhost. it slows down when performing ad count for all categories for 4 seconds and 2-3 seconds on listing ads on any category.
Performing ad count is done once per hour and will be noticed only on first visit on every our. same with listing ads in any category. slow queries that we found are cached for 1 hour. This is performed on test server for one user, it is not tested regarding how many page views it can handle per day or hour.
Script itself uses 4,5 Mb memory and loads every page on average 0,3-0,5 second.
We suggest starting with shared hosting then as your site grows move to dedicated server.