Market Size Calculator
Calculate Your TAM, SAM & SOM in 60 Seconds

Market sizing is the foundation of every credible business plan and investor pitch. TAM, SAM, and SOM provide a structured framework to quantify your opportunity, prioritize resources, and set realistic revenue targets. Investors evaluate market size before anything else — if the market is too small, even perfect execution will not produce venture-scale returns.

What Are TAM, SAM, and SOM?

TAM (Total Addressable Market) is the total revenue opportunity if you captured 100% of the market with zero competition. It represents the entire global demand for your category. SAM (Serviceable Addressable Market) is the portion of TAM that your product can actually serve — filtered by geography, language, company size, and industry. SOM (Serviceable Obtainable Market) is the realistic revenue you can capture in the near term, typically 1-5% of SAM for an early-stage startup.

Bottom-Up vs Top-Down Market Sizing

This calculator uses the bottom-up approach, which is preferred by investors because it starts with specific, verifiable numbers: how many potential customers exist, what will you charge each one, and what percentage can you realistically reach. Top-down approaches start with industry reports ("The global SaaS market is $200B") and apply assumptions — they look impressive but are less credible because the assumptions are harder to defend.

How Investors Evaluate Market Size

VCs typically require a TAM of $1B+ and a SOM of $100M+ to justify a venture investment. Angel investors and bootstrapped founders can succeed in smaller markets ($10M-$100M SOM). The key is not just the size — it is the growth rate. A $500M market growing at 20% annually is more attractive than a $2B market growing at 3%. Use our Runway Calculator to see how long your funding lasts while you capture market share.

Common Market Sizing Mistakes

The most common mistake is making TAM too large by defining the market too broadly. If you are building an AI writing tool for real estate agents, your TAM is not "the $200B global AI market" — it is the number of real estate agents multiplied by what they would pay for your tool. The second mistake is overestimating SOM. First-year market share for most startups is well under 1%, not 10-20%.

How to Expand Your Market Over Time

Start narrow (small SOM), dominate your niche, then expand. You can grow your addressable market by: adding geographies (launch in new countries), expanding segments (move from SMB to mid-market), adding products (new features create new use cases), or raising prices (higher ARPU increases market value without more customers). Amazon started with books, then expanded to everything.