“How big is the market, really?”

What they're really asking

Can this become a venture-scale company? Investors rarely care about the question on its own. They're testing whether you know your numbers cold, whether your assumptions are honest, and whether you can explain them simply.

How to answer, step by step

1. Start bottom-up: number of target customers x what each pays per year.
2. Show the slice you can reach in 3-5 years (SOM), not just the total.
3. Name the source of each number.

An example answer

There are about 400,000 small software teams in our launch markets. At roughly $5,000 a year each, that's a $2B serviceable market. Reaching 1% gives us a $20M ARR business.

Figures are from Loopdesk, the fictional SaaS company in our sample files. Swap in your own numbers and keep the structure.

The answer that loses trust

Where the proof lives

Before the meeting, find the number behind your answer. In our workbooks it lives in: Investor Presentation Masterclass, Appendix B. If you can open that tab and point to it, the follow-up question is easy.