Markets & Metrics

TAM / SAM / SOM

Nested market sizes: total, serviceable, obtainable

What it is

These three nested numbers size a market. TAM (Total Addressable Market) is the total demand if you captured 100% of everyone who could ever use the product. SAM (Serviceable Addressable Market) is the slice you can actually serve given your model and geography. SOM (Serviceable Obtainable Market) is the realistic chunk you can win in the near term.

Why it matters

Investors use market sizing to judge whether a startup can get big enough to matter. Founders who quote a giant TAM without a credible SAM and SOM signal they haven't thought hard about who actually buys.

Resources

a16z, 16 Startup Metrics

a16z.com