TAM, SAM, SOM
Also called TAM · SAM · SOM · Total Addressable Market · Serviceable Addressable Market · Serviceable Obtainable Market
Total Addressable Market (TAM), Serviceable Addressable Market (SAM) and Serviceable Obtainable Market (SOM) are all measures of market size.
Example
Let’s say we’re evaluating the market for a company that sells roses:
TAM: The global market for all types of flowers = $500
SAM: The market for roses in the market that the company operates in = $300
SOM: The company’s expected sales based on its marketing, production and competitive positioning = $100
For a visualization, you’ll get something like this:
That’s all there is to it! Normally TAM and SAM are focused on the most when evaluating the future growth potential of a business.
Why TAM, SAM, SOM matters in investment banking interviews
Market sizing shows up in interviews and in every pitch deck you'll build as an analyst. The instinct that impresses is skepticism — TAM is routinely inflated, and noticing that signals commercial judgment.