And, this is truer in super large and growing markets like India. It's so easy to make TAM, SAM, SOM graphs and other vanity metrics extrapolated, but investors need to judge and form convictions in better ways.
Not sure when the conventional attitude of reviewing investments will change. Without naming names, we face this ever so often when companies have clear leadership or large market shares in niche and premium categories.
How many knew where a Zepto would be? Or a Mamaearth, Wakefit, Blue Tokai Coffee Roasters, and I can go on and on.
Adding to Sam's point, it's not just about how big the market is today, but how the startup is positioned to capture value as that market grows. Investors often miss the forest for the trees by focusing too much on the present size rather than the potential landscape of the future. It’s high time the investor mindset shifted from traditional TAM scrutiny to understanding growth dynamics and traction in emerging spaces.
After all, the giants of today were yesterday’s "niche players" in tiny, overlooked markets. The ability to spot these early movers is what truly separates insightful investment from just another bet on the bigger pie.
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This post was originally shared by Amit Gupta on Linkedin.