much better than the SOM is built from the bottom up

count up all the potential customers that would be a good fit for your business and multiply that number by the average annual revenue of these types of customer in your market

TAM refers to the total market demand for a product or service. It’s the maximum amount of revenue a business can possibly generate by selling their product or service in a specific market

number of customers that you are able and willing to target

calculate TAM by running a bottom-up analysis of your industry

The problem with early stage investing is that markets can never be sized in Excel. If they could be reduced to a formula, we’d all be working at hedge funds. No, the essence of early stage investing is more instinctual.