Suppose $X\in \mathbb{R}^{m \times n}$ and write $X^TX=Q^TDQ$ where $Q\in \mathbb{R}^{n\times n}$ is orthogonal and $D\in \mathbb{R}^{n\times n}$ is the diagonal matrix $D=\text{diag}(\lambda_1 , \ldots ,\lambda _m)$ with $\lambda _j \geq 0$ for all $1\leq j \leq n$. Since $I-X^TX=Q^T\big(I-D\big)Q$ is positive definite and $I-D=\text{diag}(1-\lambda _1 ,\ldots ,1-\lambda _n )$ we have $1-\lambda_j>0$ for all $j$. Therefore $\lambda_j \in [0,1)$ for all $j$ which means so is $M=\max_{1 \leq j \leq n}\lambda _j$.
Now choose $v\in \mathbb{R}^n, ||v||=1$ and set $w=Qv=(w, \ldots ,w_n)^T$. The orthogonality of $Q$ implies $||w||=1$ too. We get $$||Xv||^2=w^TDw=\lambda_1 w_1^2 + \dots + \lambda _n w_n^2\leq M||w||^2<1$$ Hence $||Xv||<1$ for any $v\in \mathbb{R}^n$ with $||v||=1$ and by compactness of the unit sphere in $\mathbb{R}^n$ we have the result.