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Copy - Copy - Class 13 Concept OVERVIEW V3
Think Startup
Created on October 16, 2024
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Review Industry Trends and Estimate Market Size (TAM)
Market Sizing and Why it is Important
Understanding Macro Trends and their Effect on Industries
DELIVERABLE:Identify Stakeholders and the Market Size
Understanding Ecosystem Stakeholders
Objective: Learn what impact industry trends have on the opportunity size and how do we understand the market sizing
CONCEPT PRIMER
By underestimating certain stakeholders, startups risk ignoring potential allies, adversaries, and influencers.
Mapping these stakeholders is a strategic exercise crucial for understanding the ecosystem within which a startup operates.
Numerous stakeholders interact with or influence the startup's operations.
Ecosystem Stakeholders
Analyzing the macro conditions is critical for assessing the viability of a new startup because these conditions can determine the overall business climate in which the startup will operate.
Tech Advances
Trends that could enable or oppose the launch of new startups
MACRO TRENDS
Political Environment
Social Factors
Economic Conditions
Macro Trends that Influence the Industry
What is Market Sizing?
Importance of Market Sizing
Serviceable Obtainable Market
Serviceable Available Market
Total Addressable Market
SOM
SAM
TAM
Aids in identifying potential gaps and challenges
Aids in identifying potential growth pathways
Identifies segments with most potential
Helps determine if there is a sufficient market
What is Market Sizing and why is it important?
Explore the tool and calculate the TAM, SAM and SOM for your Solution
- Guides you step-by-step
- Contains instructions and guiding notes
- Hlps you calculate the market potential
- Helps you validate the Market potential for your Solution
HOW CAN IT HELP YOU
Your Tool to Explore:Customer & Market- Activity 3.2
- Macro Trends and Opportunity Size
- Identify positive/negative trends for your venture
- Estimate the total number of customers using research tools like Chat GPT and TAMa Talent Requirements Table for your startup.
- Upload all the details asked for in the tool
Tool Upload
- Industry Case study I and II for your chosen industry
- Identify your stakeholders
REVIEW
Steps to Take
Your Deliverable – Identify Stakeholders & Market Size
Venture Activity 4.2: Analyze Macro TrendsVenture Activity 4.3: Analyze Industry Trends & Size
Challenges Issues that can hamper the long-term development of the industry. These could include access to capital, technological difficulties, supply-chain issues, consumer acceptance, regulations, etc.
Growth Drivers Economic, consumer, etc, factors that accelerate the growth of the industry, and its constituent startups.
Growth Rate Measures how fast the industry is expanding or contracting over time. It can be assessed by looking at the increase or decrease in sales, the number of companies, or overall market size year over year.
Market Size Market size refers to the total volume of sales or revenue generated by an industry within a specific period. It can be measured in terms of the total sales value (revenue) or the total quantity of goods or services sold (units)
Serviceable Available Market The portion of your TAM that your product or service can reach given geographical constraints, regulations, capabilities, etc.
Example: The aging population in China is creating a growing market for healthcare and elder care services. There's a growing trend towards sustainability and eco-friendly products in the U.S.
Demographic trends, urbanization, cultural norms, and changes in consumer behavior can influence the demand for a startup's products or services
Social Factors
Example:Startups in China must align with the political doctrine, especially in sectors like media and education, where content and curriculum can be sensitive
A supportive political environment may provide incentives for entrepreneurship, while a restrictive one could impose barriers to entry.
Political Environment
Total Addressable Market The total possible market for your product or service, without limitations of geography, competition, distribution, or product features.
Serviceable Obtainable Market The portion of the market you can realistically capture in 2-4 years based on the current product, plans, resources, GTM activities, etc.
Economic indicators such as GDP growth, unemployment rates, and consumer confidence are important to consider. Example Low interest rates make it beneficial for startups, which often rely on external financing to get off the ground. Low-interest rates reduce the cost of borrowing, making it easier for startups to finance operations,
Economic Conditions
The rate of technological innovation can create new opportunities for startups or render existing products obsolete Example: India's telecom revolution, led by Jio, has dramatically increased internet accessibility, opening up markets for startups in e-commerce, online education, and remote services. The advent of AI technologies like ChatGPT has opened up several new opportunities in education, customer care, etc.