Index Ventures partner Jahanvi Sardana advises early-stage founders to look beyond Total Addressable Market (TAM) when building startups.
She highlights that many successful companies, like Google and Microsoft, emerged from markets that were initially nonexistent.
Sardana categorizes TAM into known, emerging, and invisible markets, emphasizing the importance of understanding customer needs and demonstrating innovation, especially in creating new markets.
She advises founders to develop their own unique insights rather than relying solely on industry reports and metrics when evaluating their market.
Ultimately, investors prioritize evaluating founders' understanding of their customers and their ability to unlock supply and change behavior in the market.