Before launching, you need to assess whether the market is big enough to make a living from. We use three nested circles: TAM, SAM and SOM, from the broadest to the most realistic.

TAM SAM SOM TAM — total market every possible customer E.g. 5,000,000 € SAM — reachable market those you can actually serve E.g. 800,000 € SOM — realistic share what you aim for at first E.g. 60,000 €

What each one means

  • TAM (Total Addressable Market): the whole market, if everyone were a customer.
  • SAM (Serviceable Available Market): the share your offer can realistically serve (geographic area, segment).
  • SOM (Serviceable Obtainable Market): the realistic share you can capture at the start, given the competition.

A concrete calculation

Imagine an organic veg box delivery service in one city. TAM: 100,000 households × 600 € a year = 60 M€. SAM: only 20% care about organic and live in your area, so 12 M€. SOM: realistically you capture 1% in year one, which is 120,000 €. That last figure is the one that has to cover your costs and your own pay.

Key takeaway: TAM = total market, SAM = reachable market, SOM = realistic share at launch. The SOM is what tells you whether the project is viable.

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