Market Sizing

Also called Bottom-Up Market Sizing and Top-Down Market Sizing

Estimating how big a market is, using a top-down approach (start from a big industry figure and narrow) or bottom-up (build from customers, price, and volume). Bottom-up is usually more credible.

Why it matters

How you size a market reveals how well you understand it, and investors trust a bottom-up build far more than a top-down slice of a giant number. The exercise itself sharpens your grasp of customers, pricing, and reach.

For example

A founder builds market size bottom-up, 50,000 target clinics times a 1 lakh yearly price, arriving at a credible 500 crore market rather than a hand-wavy 'billion-dollar' claim.

Go deeper

All Markets Are Not Created Equal Above the Crowd · article A reminder that a market's size is only one of many factors that determine whether it is worth attacking, with the rest laid out. Open abovethecrowd.com →

Related terms

Also in Starting Up

See how founders actually handle this on Growing and marketing, part of the Starting Up hub.

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