Step 5 of 11 — Market Lens
Understanding your market without guessing
How many people could possibly pay you? How many can you actually reach? And what's the real competition doing? Market Lens gives you a grounded answer — not a number you pulled from thin air to impress an investor.
Why this matters
"Total market: $10 billion" sounds impressive but means nothing. What matters is: of those 10 billion dollars, how much do you realistically get in year one? Markets are usually narrower than you think, and narrower is better — it means you can actually reach your customers with a launch budget of ₹0. The goal here isn't a big number; it's an honest one.
What you'll do in this step
- Estimate your TAM, SAM, and SOM — three market sizes from broad to reachable.
- Pick a sizing method: Top-down (start from industry numbers) or Bottom-up (start from how many customers × what they'd pay).
- Build a feature battlecard comparing you vs. top 2–3 alternatives.
- Note market trends (PESTEL: Political, Economic, Social, Technological, Environmental, Legal) that could help or hurt.
A real example
For Ananya's internship-matching service, what do the three market sizes look like?
TAM (Total Addressable Market)
Every BCom/BBA/BTech student in India — roughly 8 million. If each paid ₹500/year, that's ₹400Cr. This is the "whole universe" number.
SAM (Serviceable Addressable Market)
Students in Tier-2 cities who actively seek internships online — roughly 1.5 million based on Internshala's reported user base filtered to non-metro. If each paid ₹500/year, ₹75Cr. This is realistic for an app of her type.
SOM (Serviceable Obtainable Market)
Students Ananya can reach in year one via 10 Jaipur colleges + 5 Nagpur colleges via campus WhatsApp groups — maybe 5,000 students. At ₹500 each, ₹25L in year-one revenue if everyone converted. More realistically 5% convert → ₹1.25L in year one. This is the number that matters.
What this tells Ananya
₹1.25L in year one won't make her rich — but if that's enough to prove the model works, year 2 with 30 colleges could be ₹7.5L, and year 3 with 100 colleges ₹25L. That's a path. A ₹400Cr TAM tells her nothing.
Common mistakes to avoid
- Leading with TAM — investors see through "$10 billion market" immediately. SOM is what earns their trust.
- Skipping the bottom-up check — if your top-down says ₹100Cr but bottom-up says ₹2Cr, one of them is wrong. Usually the top-down.
- Ignoring what's already working — if 3 well-funded competitors already serve your SOM and haven't grown past 1000 users, that's a signal.
How Margawise helps
- AI estimates TAM/SAM/SOM from your idea and personas, with clearly labeled sources so you can edit and refine.
- Top-down vs. Bottom-up toggle lets you cross-check — the truth is usually between the two.
- Perceptual Map (unlocks after 10 interviews) plots how customers perceive you vs. competitors on two dimensions you pick.
- PESTEL trends highlight macro signals (regulation, social shifts, new tech) that could help or hurt your window.
Ready to try this in your own project?
Open Market Lens stepFree to start · No credit card required
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