Total Addressable Market

Noun · Startup & VC

Definitions

  1. The total revenue opportunity available if a product achieved 100% market share. Typically broken down into TAM (total market), SAM (Serviceable Available Market — the segment you can reach), and SOM (Serviceable Obtainable Market — realistic near-term capture). Investors use TAM to evaluate whether a market is worth pursuing.

    In plain English: The total amount of money that could be made if you sold to every possible customer in your market.

    Example: "The global developer tools TAM is $50B, our SAM targeting enterprise is $8B, and our SOM in year one is $200M."

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