Wing Varndell came on as a half-time replacement against Hong Kong and helped England recover from a slow start and a sin-binning - even in Sevens they could not keep a full contingent on the field - to win 42-5.
It was Varndell's first appearance in an England Sevens jersey since the 2006 Commonwealth Games final in Melbourne, since when he has made two false starts in the Test arena and been dropped like a stone by Leicester.
Critics argue Varndell's defence is not strong enough - but both Lomu and Lawrence Dallaglio believe he is too talented an athlete for England to overlook.
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Lomu, one of rugby's greatest ever wingers, said: "He has the qualities (to make it at Test level) but when he steps out onto the field he has got to back himself. That comes down to the coaches.
"I think he just needs to find his confidence more than anything else. That is what happens with certain players in the 15-man game they get down on themselves.
"This environment is good to get your confidence back and get belief in yourself.
"The thing with Tom is that if he gets the ball he can pin his ears back and go for it because not many people would catch him.
"I think the most dangerous thing is when you have an England forward pack that is confident and backs that are too. That needs to be re-established."
Varndell, who has clocked 10.8seconds for the 100metres in his socks, proved exactly that with when he seared outside the Hong Kong defence for a spectacular try.
The third time he got the ball resulted in England's final try.
In between time, Ben Gollings scored twice to finish with a personal haul of 22 points while Josh Drauniniu added to Tom Biggs' first-half try as England recovered from a stuttering start.
Exeter's Kevin Barrett was sin-binned for a deliberate knock-on after he had been left isolated in defence and Hong Kong went 5-0 ahead.
But they could not live with Gollings in midfield or Varndell out wide - and he will scare tougher teams this weekend than Hong Kong.
"I have never understood why people don't believe in him," said Dallaglio, Emirates Airline's first global sports ambassador.
"He is a fantastic talent. What an athlete. Sevens breaks rugby down to its rawest form. You have to be supremely fit, you have to be able to tackle.
"You cannot have any weak tacklers in a Sevens team."
Varndell admitted it was nice to finally get his hands on the ball, which was a thinly-veiled dig at Leicester's stand-in boss Richard Cockerill.
England coach Ben Ryan knows his men will have to improve before taking on Tunisia and the dangerous Kenyans in the rest of the pool stages tomorrow.
"We need to look at our start but we clicked in the second half and Tom Varndell showed why we brought him into the team," said Ryan.
Wales opened the tournament with a 31-5 victory over Zimbabwe that featured a hat-trick for Craig Hill but ended in controversy after the referee blew for time 30 seconds early.
Wales coach Paul John was furious given qualification for the quarter-finals could well come down to points difference. The six group winners go through automatically followed by the two best runners-up.
"Points difference could be very important in this competition," said John.
Scotland lost their opening game to Canada 33-14, with Colin Gregor scoring both tries in the second-half.
Coach Stephen Gemmell was furious that Scotland allowed Canada to open a 33-0 half-time lead and said: "Our first-half performance was unacceptable. Our heads went down straight after the first score and the players just looked shell-shocked.
"The 13 of us, and I'm including myself in that, need to have a good look at ourselves before meeting Japan tomorrow."
Ireland took the lead against Samoa with a try from Brian Tuohy but the islanders proved too strong and ran out 35-5 winners with a hat-trick from Rupena Levasa.
Elsewhere, all the major nations won their opening game although Fiji were given a scare by Georgia before winning 26-10.
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