Article · 14 min read

Top-Down vs Bottom-Up Market Size Calculation

Waveup Free Intermediate

A side-by-side of both methods that makes clear why you use bottom-up as your primary number and top-down only as a rough check. That distinction is exactly what protects you when the top-down Indian data is thin. Read it to decide which method to lead with in your deck.

  • Bottom-up is defensible, top-down is only a directional check
  • Use both and reconcile them against each other
  • Lead with the method your data can actually support
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It answers 4 questions

  1. How do I size a market for India specifically when data is messy?
  2. Investors keep asking for a top-down TAM slide, but I built my number bottoms-up. Which do I show?
  3. How do I size a market I want to sell to businesses outside the big Indian startup hubs?
  4. Two of us disagree on how big the opportunity is. How do we resolve a market-size argument between cofounders?

Read with it

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  3. Before you sweat which side to seed, Gurley helps you judge whether your marketplace is even structurally worth building. He... Above the Crowd Essay · 20 min read All Markets Are Not Created Equal: 10 Factors to Consider When Evaluating Digital Marketplaces Bill Gurley
  4. A clean definition of the three market layers with the key distinction spelled out: TAM is the whole opportunity, SAM is what... Forum Ventures Article Market Sizing for Startups: TAM, SAM, SOM Explained Forum Ventures
  5. Blume's annual report is the single best data-grounded read on what is actually happening in Indian internet and consumption,... Blume Ventures Article · ~180 charts Indus Valley Annual Report 2025 Sajith Pai, Anurag Pagaria and team (Blume Ventures)
  6. Video · ~50 min How to Evaluate Startup Ideas Kevin Hale, Y Combinator
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