How big does a startup’s market need to be to make sense?

Recently I was talking to an entrepreneur and he was sharing his new idea. Now, the idea was sound and made sense but it immediately struck me as too small a market. There’s no perfect method to determining the size of a market opportunity but there’s plenty of information available.

Here’s how I like to think through if a market is large enough to go after:

So, it doesn’t need to be a billion dollar business but it does need to be large enough to build a sustainable, successful business in a reasonable amount of time.

What else? How big does a startup’s market need to be to make sense?

2 thoughts on “How big does a startup’s market need to be to make sense?

  1. Seems like fragmentation needs to be included in this discussion. It might be a huge market but are the customers disperse and thus harder to capture? Or, it could be a smaller overall market but the customers are congregated and can be quickly and efficiently captured.

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