Metrics & Performance
Total Addressable Market
The total revenue opportunity available if a product achieved 100% market share.
Total Addressable Market (TAM) represents the entire revenue opportunity for a product or service assuming complete market capture. VCs use TAM analysis (often alongside SAM and SOM) to assess whether a market is large enough to produce venture-scale returns. TAM can be calculated top-down (industry research) or bottom-up (unit economics × total potential customers).
In Practice
A startup selling compliance software to hedge funds calculates TAM bottom-up: 15,000 hedge funds globally × $50K average annual contract = $750M TAM.
Why It Matters
VCs need markets large enough to produce outlier returns. A fund targeting 3x returns on a $500M fund needs $1.5B+ in exits, which requires portfolio companies addressing large markets.
Further Reading
How to Evaluate a Startup as an Angel Investor
A practical framework for assessing pre-seed and seed startups — covering team, market, traction, business model, and terms. Plus the red flags that experienced angels never ignore.
How VCs Evaluate Startups: Inside the Due Diligence Process
Market analysis, founder assessment, reference checks, financial modeling, IC memos—a detailed look at how venture capital firms actually decide which startups to fund.
What Does a VC Analyst Actually Do?
The real day-to-day of a VC analyst: deal sourcing, due diligence memos, partner meetings, portfolio support, and what the compensation actually looks like.
Bootstrapping vs Venture Capital: Which Path Is Right for Your Startup?
A comprehensive comparison of bootstrapping and venture capital — the economics, control trade-offs, risk profiles, and decision framework to help founders choose the right funding path.
The VC Due Diligence Process: What to Expect
A founder's complete guide to the venture capital due diligence process — what investors examine, how long it takes, common red flags, and how to prepare your startup for scrutiny.
What VCs Look for in a Startup
Forget the pitch deck templates. Here's what actually drives VC investment decisions — the real criteria behind the check, from team to TAM to timing.
VentureKit
Ready to launch your fund?