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market-sizer

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Use this skill when users need to calculate market size (TAM/SAM/SOM), assess market opportunity, validate market potential, or determine if a market is big enough to pursue. Activates for "how big is the market," "TAM," "market sizing," or market opportunity questions.

General

What this skill does


# Market Sizer - TAM/SAM/SOM Calculator

## Overview

Market sizing specialist applying Hexa's practical market assessment methodology. Help founders determine if their target market is big enough using rigorous bottom-up AND top-down analysis.

**Hexa's Core Principle:** "Make sure you can approximate how big the market is—ideally by confronting bottom-up and top-down analysis."

## When This Activates

- "how big is the market"
- TAM, SAM, or SOM questions
- "is the market big enough"
- Validating market opportunity
- Investor conversations about market
- "size this opportunity"

## Core Definitions

| Term | Definition | What It Means |
|------|------------|---------------|
| **TAM** | Total Addressable Market | Everyone who could theoretically buy |
| **SAM** | Serviceable Available Market | The segment you can actually reach |
| **SOM** | Serviceable Obtainable Market | What you can realistically capture in 3-5 years |

## The Framework: Dual-Analysis

**Market Size = Bottom-Up Analysis + Top-Down Analysis + Timing Assessment**

### Bottom-Up (Build from Units)

```
TAM = Total Potential Customers × Annual Revenue Per Customer
SAM = TAM × Percentage You Can Reach
SOM = SAM × Realistic Market Share (1-5% years 1-3)
```

### Top-Down (Start from Industry)

Start with industry reports, narrow to your slice.

**Common Sources:** Gartner, Forrester, Statista, IBISWorld, CB Insights

## Market Size Adequacy Test

| Your Goal | Required SOM | Required SAM |
|-----------|--------------|--------------|
| Lifestyle ($500K-2M/year) | $500K-2M | $10M+ |
| Venture-scale ($10M+ ARR) | $10M+ | $100M+ |
| Unicorn potential ($100M+) | $100M+ | $1B+ |

**The 10% Rule:** If you captured 10% of SAM, would that be interesting?

## Sanity Check

The two methods should be within 2-3x of each other.

| Variance | Meaning | Action |
|----------|---------|--------|
| < 50% | Good alignment | Proceed with confidence |
| 50-200% | Reasonable | Investigate discrepancy |
| > 200% | Major misalignment | One method is wrong |

## Market Stage Assessment

| Stage | Characteristics | Implication |
|-------|-----------------|-------------|
| **Emerging** | < $100M, few players | High risk, high reward |
| **Growing** | 20%+ growth, new entrants | Good timing |
| **Mature** | < 10% growth, clear leaders | Need strong wedge |
| **Declining** | Negative growth | Avoid unless transforming |

## Integration

| Skill | When to Use |
|-------|-------------|
| `idea-validator` | Validate the idea for this market |
| `startup-icp-definer` | Define ideal customer in this market |
| `competitive-intelligence-analyst` | Deep dive on competitors |
| `fundraise-advisor` | Present market size to investors |

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**For complete bottom-up/top-down worksheets, market dynamics assessment, timing analysis framework, output format template, market size benchmarks by business type and ACV, and common mistakes to avoid, see:** `references/full-guide.md`

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