To attract investment, you need to present your market size through an investment lens. VCs want to see a clear path to a $1B+ valuation. Here is how to do it:

First, size your market with a bottom-up approach instead of top-down research. Take the audience that you think will eventually use your solution, multiply it by your average check, and you will see your addressed Total Addressable Market (TAM). Then, narrow it down to your initial target audience (Serviceable Available Market, or SAM), which can be based on geography, vertical, or specific personas. Multiply your audience by the share you can realistically get (Serviceable Obtainable Market, or SOM).

When creating your slides, ensure they have the following elements:

• Bottom-up market sizing: investors appreciate when you build your market size from the ground up. Avoid over-inflated numbers that lack a clear basis.

• Clear targeting: define your target market clearly so investors understand your strategy, including geography, vertical, and ideal customer profiles (ICP).

• Realistic average customer value (ACV): Benchmark your expected revenue per customer against competitors to show realistic projections.

• Growth potential: show how your TAM will expand as you enter new geographies or verticals and as customer spending increases.

• Credible sources: use and clearly reference reliable sources to back up your data.

• Untapped market potential: highlight how much of the market remains untapped, indicating a greenfield or blue ocean opportunity.

Beyond presenting numbers, it’s about the confidence you give to the investor that you are able to execute all along the way and be able to produce meaningful growth in revenue. To do this:

• Demonstrate your moat: show any barriers to entry that protect your market position, such as proprietary technology or exclusive partnerships.

• Highlight scalability: explain how your business can scale, emphasizing network effects or other mechanisms that drive growth. 

• First-mover advantage: if applicable, highlight your position as a first mover in the market and how this gives you a defensible edge.

The more clearly you can demonstrate these features, the more likely you will convince investors that you can gain a significant portion of a market.

🏹 Optional: combining market size with business model logic

Another effective way to demonstrate market size is to combine it with your business model. This approach shows a clear path and assumptions on how you plan to reach $100M+ in revenue, which is a critical point for investors. You can find a full logic description of this method here.