Size markets the way investors expect and operators can execute. Learn the differences between TAM, SAM, and SOM and how to avoid common sizing traps.
Which statement best distinguishes TAM, SAM, and SOM in a GTM plan?
TAM and SAM are identical; SOM is an investor-only metric.
TAM is total demand, SAM is the portion you can serve, and SOM is the share you can realistically win next.
TAM is revenue, SAM is profit, SOM is cash flow.
TAM is the customers you already have, SAM is prospects, SOM is churn risk.
Why do investors generally prefer bottom‑up sizing over top‑down slides?
It ties demand to concrete units, pricing, and conversion assumptions rather than broad industry totals.
It avoids using any third‑party data.
It removes the need to state assumptions explicitly.
It always produces a larger TAM than top‑down.
Which input most directly converts SAM into SOM?
Average CPM across social channels.
Data center utilization percentage.
Expected win rates and sales capacity over a defined time window.
Brand color palette and tone of voice.
A startup lists TAM using global revenue for ‘software’ without filtering by use case. What is the main issue?
TAM must be based only on government datasets.
Category over‑breadth inflates TAM that is irrelevant to the product’s actual job and ICP.
TAM should never be measured in revenue terms.
TAM must exclude any enterprise accounts.
Which constraint most often shrinks SAM versus TAM for a new GTM motion?
Publishing thought‑leadership content.
Logo redesign costs.
Limits in geography, channel coverage, compliance, or service model.
Using a PLG pricing page.
In bottoms‑up sizing for a B2B SaaS, which unit choice is most defensible?
Apply an arbitrary 10% capture to industry revenue.
Use pageviews as a proxy for annual contracts.
Multiply social followers by CTR and call it revenue.
Count target accounts/users and multiply by realistic ARPA/ARPU.
When should SOM be forecast as a range instead of a single point estimate?
Only when TAM is under $100M.
When win rate, ramp time, and capacity carry material uncertainty.
When a competitor has recently rebranded.
Whenever paid media is part of the plan.
Which check prevents double‑counting in TAM for a multi‑product portfolio?
Add 20% buffer to each segment for safety.
Ignore accounts below median ACV.
Use the largest competitor’s revenue as the floor.
De‑duplicate overlapping use cases and shared wallets across segments.
What strengthens credibility when presenting a very large TAM?
Showing a clear path from SAM to SOM with staged capacity and proof of demand.
Removing footnotes to keep slides clean.
Using more decimal places in the TAM figure.
Presenting only a CAGR chart without assumptions.
Which metric pairs best with SOM for headcount planning?
Average email open rate last quarter.
Share of voice in trade media.
Pipeline coverage versus quota per rep over the forecast period.
Website dwell time on the pricing page.
Starter
You’re getting the basic layers—now practice bottom‑up math on real account lists.
Solid
Good grasp of sizing and constraints—tighten assumptions, dedupe overlaps, and tie SOM to capacity.
Expert!
You think like an operator: your numbers connect market theory to pipeline, win rate, and headcount.
