In the 717th 1Mby1M Mentoring Roundtable, Sramana Mitra addresses one of the most misunderstood concepts in early-stage fundraising: the difference between Top-Down TAM and Bottom-Up TAM, and why that distinction directly determines startup fundability. Watch the full recording below to understand how Bottom-Up TAM transforms your startup fundability story from theory into measurable proof.
The Core Challenge: Top-Down vs. Bottom-Up TAM During this week’s 1Mby1M roundtable, we saw a recurrence of an issue that plagues nearly 80% of the startups that pitch to us: the confusion between Top-Down TAM and Bottom-Up TAM. Most first-time entrepreneurs struggle to define a Bottom-Up Total Addressable Market, yet this metric is the bedrock
Justin Wexler, General Partner at WndrCo, discusses his firm’s investment thesis.
In case you missed it, you can listen to today’s recording here:
During this week’s roundtable, we first had Justin Wexler, General Partner at WndrCo discuss his firm’s investment thesis. Griin As for our entrepreneur pitches, we had Valentina Salazar, from Mexico City, Mexico, pitch Griin. Valim Next, we had Koran Rohan from Palo Alto, California, pitch Valim.
TAM = Total Available Market. Most entrepreneurs do a terrible job of modeling a defensible TAM. Yet, TAM drives Fundability. It’s not exactly something you can afford to mess up. The most common TAM error is choosing Top-down TAM over Bottom up TAM. Top-down, 30,000 ft TAM means nothing. Please go through the Market Sizing
There is too much money chasing too few venture scale deals. As a result, sometimes, VCs fund deals that should not be funded to appease their Limited Partners. And then, they drive these ventures to failure. Let me explain. Let us say, you have been successful in raising $5M in venture capital.