The Launch, Expansion and Total Market method is GREAT. It still complex for founder to execute (but normally its because they’re still making market research), but the methodology is USEFUL. I’m telling this as someone who has worked with thousands of startups in different accelerators for 14 years.
I was genuinely feeling disappointed and skeptical about the entire TAM SAM SOM and thought there’s no way that’s the standard for investors? I’m working on a very unique solution and HOLY… the way you put it “Launch market, expansion market and total market” NAILED IT. It makes so much sense with the market I’m working with and the problem I’m solving and how it will evolve across different sub industries. Thank you for the video it gave me a sense of reassurance. Also was a good reminder to always stay skeptical about popular frameworks. They don’t always make sense.
Thanks for suggesting I watch this video, Lance. Very helpful! Now my Market Opportunity slide wont confuse my potential investorsas much as it confused me trying to put it together!
For public companies, this would usually happen when they are giving earnings guidance. I have not seen them talk in terms of TAM-SAM-SOM, though. They do talk about projected growth and the size of various opportunities.
So projected revenues are calculated per year right? So how is it related to SOM? Is SOM a yearly math? Like what if my Financial Projections are for 3 years is 5 million. My SOM over 5 years is 10 million.
That was just an example but I didn't know that TAM SAM SOM are annualized. I don't think enough people actually mentioned this till date. It's a pretty dumb doubt I guess. Also can you tell the difference between market size and GMV? I googled but didn't understand.
You are probably looking at Gross Merchandise Value. This is very similar to Gross Transaction Volume. These both refer to the total cash value of all the transactions on a platform. For marketplace and financial service companies, the problem is that they usually take a small commission on all those transactions. They may process a huge amount of money, but they only make a little bit. In that case, the GMV or GTV vastly overstate the company's potential revenues. The market should be based on TAM-SAM-SOM of the revenue the company could make, not the transactions it processes.
The Launch, Expansion and Total Market method is GREAT. It still complex for founder to execute (but normally its because they’re still making market research), but the methodology is USEFUL. I’m telling this as someone who has worked with thousands of startups in different accelerators for 14 years.
Thanks, I appreciate the vote of support for this approach. I agree that it is still work to get the market right.
The strategy of starting from launch market, expansion market and then total market sounds more practical and make it feel much easier! Thanks Lance.
Excellent! It certainly works better for me as an investor.
I was genuinely feeling disappointed and skeptical about the entire TAM SAM SOM and thought there’s no way that’s the standard for investors?
I’m working on a very unique solution and HOLY… the way you put it “Launch market, expansion market and total market” NAILED IT.
It makes so much sense with the market I’m working with and the problem I’m solving and how it will evolve across different sub industries.
Thank you for the video it gave me a sense of reassurance. Also was a good reminder to always stay skeptical about popular frameworks. They don’t always make sense.
Thanks! I would love to hear more about your startup.
@@FeeltheBoot actually?
@@malghorani absolutely. I am always curious about what founders are working on, and it can help the community too.
@@FeeltheBoot sounds great, can I add you on LinkedIn or send an email?
Thank you. This is very valuable. I was stressed about how innately silly this concept seemed, especially when you're trying to do 'category design.'
Glad it was helpful!
Thanks for suggesting I watch this video, Lance. Very helpful! Now my Market Opportunity slide wont confuse my potential investorsas much as it confused me trying to put it together!
Fantastic! So glad it helped!
Any good examples of a public company that has aligned their SAM, SOM TAM with their timeline/revenue projection?
For public companies, this would usually happen when they are giving earnings guidance. I have not seen them talk in terms of TAM-SAM-SOM, though. They do talk about projected growth and the size of various opportunities.
Thank you!
My pleasure!
This is very helpful! Thank you so much, Lance!
I'm glad you found it helpful! Thank you for watching!
Clear enough, thank you!
Great to hear!
The best video I seen for this, thanks!
Wow, thanks!
Many thanks for such valuable content 👍Your advice is a real treasure!
Looking forward to your next videos!
So nice of you! Glad you enjoyed it!
Thanks Lance, much appreciated!
My pleasure!
Thank you for the great video. Very helpful to us 👍
Awesome to hear it was helpful! Thanks for watching!
Great one, Lance!
Is this channel called Fell the Boot or Feel the Boost? 🤔🚀
Learning a lot! I appreciate! 😎🤘
Ha! 🤣 It's "Feel the Boot" because some of the people I advised early on started calling me "The Boot" and I thought I would lean into that. 😳
So projected revenues are calculated per year right? So how is it related to SOM? Is SOM a yearly math? Like what if my Financial Projections are for 3 years is 5 million. My SOM over 5 years is 10 million.
All of them should be annualized. In five years, how much will you be selling each year?
That was just an example but I didn't know that TAM SAM SOM are annualized. I don't think enough people actually mentioned this till date. It's a pretty dumb doubt I guess. Also can you tell the difference between market size and GMV? I googled but didn't understand.
You are probably looking at Gross Merchandise Value. This is very similar to Gross Transaction Volume. These both refer to the total cash value of all the transactions on a platform. For marketplace and financial service companies, the problem is that they usually take a small commission on all those transactions. They may process a huge amount of money, but they only make a little bit.
In that case, the GMV or GTV vastly overstate the company's potential revenues. The market should be based on TAM-SAM-SOM of the revenue the company could make, not the transactions it processes.
Great explanation. Very informative. Keep sharing
Thank you, I will!
This is great
Thanks, much appreciated!!
👍
0 trust
????
@@FeeltheBoot😂😂