Glossary
TAM, SAM, SOM
Total market, the slice you can serve, and the slice you can realistically win.
TAM is everyone who could ever buy this kind of thing. SAM narrows it to the ones your product and geography can actually serve. SOM is what you could plausibly capture in a few years given your team and money.
Almost every deck overstates all three, usually by starting from a global industry figure and taking a percentage of it. That method proves nothing, and investors have seen it thousands of times.
The credible way round is bottom-up: how many businesses of this type exist in the markets you serve, what would each pay a year, multiply. A smaller number you can defend beats a huge one you cannot.
Related terms
- Bottom-up market sizing — Building a market estimate from countable customers rather than a global figure.
- ICP (ideal customer profile) — The specific kind of buyer your product fits best, described precisely.
Read next
See where this number sits in the rubric
The GTM Score is published in full, check by check, so you can see exactly what each figure is worth before you go looking for it.
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