Total Addressable Market (TAM)
Definition
TAM is the total revenue opportunity if a product captured its entire market; SAM (serviceable addressable) narrows to the reachable segment, and SOM (serviceable obtainable) to a realistic share.
How it comes up in fundraising
Investors prefer bottom-up TAM (number of target customers times realistic price) over top-down slide math, which they discount on sight.
Frequently asked questions
How big must TAM be for venture capital?
Big enough to support a company at $100M-plus revenue with room beyond; many funds shorthand this as a $1B-plus market.
What is bottom-up market sizing?
Counting actual buyers and multiplying by achievable pricing, the way Uber’s famous deck sized taxi spend from first principles.
Related terms
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