Market Sizing Analysis
Size TAM, SAM, and SOM for a SaaS or e-commerce idea before you commit to build and pricing.
Overview
Market Sizing Analysis is an agent skill most often used in Idea (also Validate) that walks solo builders through TAM, SAM, and SOM with bottom-up segment math and a full SaaS worked example.
Install
npx skills add https://github.com/wshobson/agents --skill market-sizing-analysisWhat is this skill?
- Bottom-up TAM via segment count × ACV with documented data sources (Census, Shopify ecosystem, Statista, LinkedIn valida
- Worked B2B SaaS example: AI email marketing for e-commerce with $1M+ revenue bands and tiered ACV ($3.6k–$24k)
- Segment breakdown template: small / mid-market / enterprise e-commerce with priority columns
- Pairs top-down and bottom-up methodologies for defensible investor and roadmap conversations
- Geography and pricing assumptions explicit ($500/mo average, North America first, 3–5 year horizon)
- 3 customer segments in worked example (small, mid-market, enterprise e-commerce)
- Bottom-up and top-down methodologies
- 3–5 year market opportunity horizon in example
Adoption & trust: 7.3k installs on skills.sh; 36.5k GitHub stars; 3/3 security scanners passed (skills.sh audits).
What problem does it solve?
You have a product concept but no defensible way to explain how big the opportunity is or which revenue band to target first.
Who is it for?
Founders sizing a B2B or D2C SaaS wedge before building, who need investor-credible or self-honest market math.
Skip if: Teams that already have signed LOIs and locked pricing—skip straight to validate prototyping unless you are refreshing expansion TAM.
When should I use this skill?
Starting opportunity research for SaaS or e-commerce and you need defensible TAM/SAM/SOM before committing to build.
What do I get? / Deliverables
You leave with segment tables, TAM/SAM/SOM formulas filled with sourced assumptions, and a wedge you can carry into scope and pricing validation.
- Segment table with counts and ACV
- TAM/SAM/SOM calculations with cited sources
- Priority wedge recommendation
Recommended Skills
Journey fit
Spans multiple journey phases - primary shelf plus alternate fits below.
Market sizing is the canonical first step when researching whether an opportunity is large enough to pursue—before validation artifacts and pricing lock-in. The skill walks bottom-up and top-down TAM/SAM/SOM with segment tables and revenue bands, which is core opportunity research, not implementation.
Where it fits
Compare two e-commerce niches by countable merchants and ACV before picking a wedge.
Ground competitive landscape claims in segment size rather than hype.
Cap MVP ICP to the segment band that makes SAM achievable in year one.
Map $500/mo-style price points to mid-market ACV expectations in the model.
How it compares
Structured sizing workbook for agents, not a live CRM or market-data API integration.
Common Questions / FAQ
Who is market-sizing-analysis for?
Solo and indie builders researching SaaS or e-commerce niches who need TAM/SAM/SOM and segment ACV logic before they invest in a full build.
When should I use market-sizing-analysis?
In Idea research when comparing verticals; in Validate scope when narrowing ICP; and in Validate pricing when anchoring ACV tiers to reachable company counts.
Is market-sizing-analysis safe to install?
It is documentation-style planning guidance with no offensive tooling; review the Security Audits panel on this page before installing from any third-party skill source.
SKILL.md
READMESKILL.md - Market Sizing Analysis
# SaaS Market Sizing Example: AI-Powered Email Marketing for E-Commerce Complete TAM/SAM/SOM calculation for a B2B SaaS startup using bottom-up and top-down methodologies. ## Company Overview **Product:** AI-powered email marketing automation platform **Target:** E-commerce companies with $1M+ annual revenue **Geography:** North America (initial), global expansion planned **Pricing:** $500/month average (scales by email volume) **Timeline:** 3-5 year market opportunity ## Methodology 1: Bottom-Up Analysis (Primary) ### Step 1: Define Target Customer Segments **Segment Criteria:** - E-commerce companies (D2C and marketplace sellers) - $1M+ in annual revenue - North America based - Currently using email marketing **Segment Breakdown:** | Segment | Annual Revenue | Count | ACV | Priority | | --------------------- | -------------- | ------ | ------- | -------- | | Small E-commerce | $1M-$5M | 85,000 | $3,600 | High | | Mid-Market E-commerce | $5M-$50M | 18,000 | $9,600 | High | | Enterprise E-commerce | $50M+ | 2,500 | $24,000 | Medium | **Data Sources:** - U.S. Census Bureau: E-commerce business counts - Shopify, BigCommerce, WooCommerce: Published merchant counts - Statista: E-commerce market statistics - LinkedIn Sales Navigator: Company search validation ### Step 2: Calculate TAM (Total Addressable Market) **Formula:** ``` TAM = Σ (Segment Count × Annual Contract Value) ``` **Calculation:** ``` Small E-commerce: 85,000 × $3,600 = $306M Mid-Market: 18,000 × $9,600 = $173M Enterprise: 2,500 × $24,000 = $60M -------- TAM (North America): $539M ``` **Global Expansion Multiplier:** - North America = 35% of global e-commerce market - Global TAM = $539M / 0.35 = $1.54B **TAM = $1.54B globally, $539M North America** ### Step 3: Calculate SAM (Serviceable Available Market) **Filters Applied:** 1. **Geographic Filter: North America Only (Year 1-2)** - Base TAM: $539M - Filter: 100% (starting in North America) - Result: $539M 2. **Product Capability Filter: AI-Ready Customers** - Customers ready to adopt AI email marketing - Excludes: Companies with basic email needs only - Filter: 45% (based on survey data) - Result: $539M × 0.45 = $242M 3. **Current Tool Filter: Addressable Switching Market** - Customers using incumbent tools who would switch - Excludes: Recently switched, custom built solutions - Filter: 70% (typical B2B SaaS switching market) - Result: $242M × 0.70 = $169M **SAM = $169M** **SAM Breakdown by Segment:** ``` Small E-commerce: $306M × 0.45 × 0.70 = $96M (57%) Mid-Market: $173M × 0.45 × 0.70 = $54M (32%) Enterprise: $60M × 0.45 × 0.70 = $19M (11%) ``` ### Step 4: Calculate SOM (Serviceable Obtainable Market) **Market Share Assumptions:** **Year 3 Target: 2.5% of SAM** - Typical new entrant market share - Requires strong product-market fit - Assumes $10M in funding for GTM **Year 5 Target: 5% of SAM** - Achievable with scale and brand - Requires effective sales and marketing - Assumes additional funding for growth **Calculation:** ``` SOM (Year 3) = $169M × 2.5% = $4.2M ARR SOM (Year 5) = $169M × 5.0% = $8.5M ARR ``` **SOM by Segment (Year 5):** ``` Small E-commerce: $96M × 5% = $4.8M ARR (565 customers) Mid-Market: $54M × 5% = $2.7M ARR (281 customers) Enterprise: $19M × 5% = $1.0M ARR (42 customers) -------- Total: $8.5M ARR (888 customers) ``` ### Bottom-Up Summary | Metric | North America | Notes | | ---------------- | ------------- | -------------------------------------- | | **TAM** | $539M | All e-commerce $1M+ revenue | | **SAM** | $169M | AI-ready, addressable switching market | | **SOM (Year 3)** | $4.2M | 2.5% market share