Chapter 2 · Startups as Investments

Market Sizing

Every deck has a slide claiming the market is $100 billion. Most of those slides are wrong. The good ones are defensibly wrong; the lazy ones are just a Google search; once in a while you find a real number. The point here is to pressure-test a TAM: top-down vs bottom-up, comparable benchmarks, the standard traps founders fall into sizing their own markets. After this, when someone says 'we'll capture 1% of a $50B market,' you'll know the better question to ask.