Free · Startup calculator

TAM SAM SOM Calculator

Build a market size from the bottom up — customers multiplied by price, then narrowed to what you can actually reach.

Free·No signup·Runs in your browser

Calculated

$60,000,000

Total addressable market

Potential customers worldwide 50,000 · Annual price per customer $1,200

Price
Free
Inputs
4
Account needed
No
Last updated
20 September 2026

Use the tam sam som calculator

This free calculator runs in your browser. Nothing is sent to a server, and no account or email is required. Enter:

  • Potential customers worldwide — Every organisation that could plausibly buy this.
  • Annual price per customer — Your realistic annual contract value.
  • Serviceable share — Reachable given your geography, language and segment.
  • Obtainable share — Realistic capture within a few years.

How it works

  1. 1

    Enter your numbers

    Fill in potential customers worldwide, annual price per customer, serviceable share and obtainable share. Nothing is sent anywhere — the maths runs in your browser.

  2. 2

    Press calculate market size

    One button. Change any input afterwards and the answer updates as you type.

  3. 3

    Read the result

    You get total addressable market, plus serviceable market, obtainable market.

What TAM, SAM and SOM mean

TAM is the total addressable market: every potential customer in the world multiplied by what they would pay annually. SAM is the serviceable portion you could sell to given your geography, language, segment and product. SOM is the share you could realistically win within a few years.

Each nests inside the one above. With 50,000 potential customers at $1,200 a year, TAM is $60m. If 30% are reachable, SAM is $18m. If you could win 10% of those, SOM is $1.8m.

More on tam/sam/som

Build it bottom-up, not top-down

Top-down sizing starts with an analyst report and claims a slice: "the market is $50bn and we only need 1%." Investors have heard it thousands of times and it signals that you have not done the work, because the 1% is arbitrary and the $50bn usually includes segments you will never touch.

Bottom-up sizing starts with countable things: how many organisations fit your profile, and what will they realistically pay. Every input is one you can source and defend, and the resulting number is smaller but survives scrutiny.

Choosing your percentages honestly

The serviceable share reflects real constraints today: which countries you can sell into, which languages you support, which company sizes your product actually fits. If you sell only in English to companies over 50 people, say so and cut accordingly.

The obtainable share is where founders inflate. Ask what share the current market leader holds after a decade of effort, then ask what makes a three-year-old startup take more. Single-digit percentages are normal and a defensible small number beats an indefensible large one in every investor conversation.

Why a smaller number often works better

A credible $50m SOM you can walk through line by line is more persuasive than a $5bn TAM with no supporting logic. The purpose is not to prove the opportunity is enormous — it is to prove you understand who buys, what they pay, and why.

If the honest number is too small to build a venture-scale business on, that is genuinely useful information, and much cheaper to learn now than after two years of building.

Accuracy and limitations

  • Only as good as your customer count and price. Both are estimates, and the result inherits their error.
  • Assumes one price for everyone. Tiered pricing and enterprise deals need the segments sized separately.
  • A market size is not a plan. It bounds the opportunity; it says nothing about whether you can reach it.

Frequently asked questions

What is the difference between TAM, SAM and SOM?
TAM is every potential customer worldwide. SAM is the portion you can serve given geography, language and segment. SOM is the share you can realistically capture in a few years. Each sits inside the previous one.
How do you calculate TAM bottom-up?
Multiply the number of potential customers by the annual price they would pay. 50,000 customers at $1,200 a year gives a $60m TAM — with both inputs you can source and defend.
Why do investors dislike top-down market sizing?
Because "the market is $50bn and we need 1%" is arbitrary, and the headline figure usually includes segments the company will never serve. Bottom-up sizing shows you understand your actual buyer.
What obtainable share is realistic?
Usually single digits of your serviceable market within the first few years. Compare against what the current leader holds after a decade before assuming anything higher.
What if my market looks too small?
That is valuable information. It may mean expanding the segment, raising price, or reconsidering the opportunity — all far cheaper to work out now than after years of building.

More ways to run the numbers.

  • SaaS Valuation Calculator A defensible ARR-multiple range driven by growth and margin. Useful before a conversation about price, not instead of one. Open →
  • CAC Calculator What it actually costs to win one customer. The input that lifetime value, payback and every paid channel decision depend on. Open →
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