We are encouraged to think. Pitch Meetings as Trials by Fire: If an entrepreneur negotiates deadly traps and slays the skeptical monsters of bedevil tech investors, they’ll be rewarded with a golden secure note at the end of their quest.
Especially for first-timers, the game has become an existential drama, with things like long slide decks, not preparing investors before meetings, and exaggerating the size of the total addressable market (TAM), which can lead to fatal decisions. Hope to compete.
“With TAM, you’re guaranteed to be wrong,” Aydin Senkut, founder and managing partner of Felicity Ventures, told TechCrunch Disruption. “It will be too big or too small.”
Cara Northman, managing partner at Upfront Ventures, said the TAM numbers given in the pitch don’t dictate whether she’ll be able to invest. ” i say. [it is] Being able to describe how big something is going to be and if it’s early enough to show you have a thought process around TM.
According to Dina Shakir of Lux Capital TAM, the related metrics serviceable addressable market (SAM) and serviceable market (SOM) are not meant to be set in stone. Founders are simple planning tools that help demonstrate their company’s potential, while SOM and SAM help de-risk.
“If we were to take the meeting, we would all intuitively think there’s something interesting about being bankable,” she says. “The way it was calculated and the founder’s thinking tells us not necessarily about the business or the future, but the founder’s view of the company’s innovation.” And this is very important in the first place. “
All three panelists’ TAM, SAM, and SOM numbers provide a window into a founder’s mindset, but they aren’t determinative factors because they have a general understanding of the sectors in which founders hope to compete.
