Serviceable available market (SAM)

Serviceable available market, or SAM, is the portion of a total addressable market that a company can serve with its current product, geography, customer type, and business model. It narrows a broad TAM into the spending connected to the company’s actual category and constraints.

A useful SAM is built from explicit assumptions. A startup selling compliance software to mid-sized United States banks should not count all global financial-services technology spending. It might estimate the number of eligible banks, relevant users or contracts per bank, and realistic annual pricing. In a market slide, SAM helps investors understand the size of the initial playing field without pretending the company can address every adjacent segment immediately. It should remain distinct from SOM, which estimates the share the company might realistically capture. Founders should cite sources and show the arithmetic, ideally checking a top-down estimate against customer-level economics. Precision is less important than a defensible boundary and a clear relationship to the go-to-market plan.