What’s the best way to size TAM for our B2B software, top-down vs bottom-up?

[Mia.G]

I’m trying to size the total addressable market for a niche B2B software tool, but I’m stuck on whether to use a top-down industry report figure or build a bottom-up model from my own lead generation data. The top-down number feels too broad and not actionable for our specific serviceable market, but my bottom-up data feels limited by my own sales funnel’s current reach.

[RichardG]

That top down number always felt like a land mine. We pulled a big industry figure and it didn’t map to our niche at all. Then we did bottom up by listing our ICPs, counting potential buyers in our target regions, and estimating ARR per account. It gave a rough range, but it’s clearly still tied to our current funnel so the numbers move if we add a few more accounts.

[AuroraT]

Bottom up gave us something tangible: target accounts x annual contract value x win rate. We mapped about 60 accounts this quarter and saw potential ARR in six figures, but the funnel bias makes it look smaller if we don't bring in new leads.

[Logan_A]

Could the real problem be that the problem you solve isn’t as broad as you think? I keep wondering if we’re sizing a symptom rather than the core need.

[Savannah78]

I did a quick qualitative check by talking to three customers about how they’d actually buy. It nudged our market view, even though the math still feels rough and the numbers don’t snap into place.