Check the scalability of supply & demand
Elasticity of the market to $100M revenue
Do you see the path clearly or will there be challenges after 1M revenue in the market
This is a small exercise to get a view on if this market has a potential of $100M revenue.
For ex:
Freshworks is a $100M+ revenue company.
Customer Service, Customer Helpcare is a multibillion dollar market.
Swiggy is a $100M+
Food Tech Market in India can accommodate multiple 100 Million dollar companies.
Which markets have very less possibility of $100M
- Podcasting In India is a small market, it can not create a company beyond $100M
- Stock content in India
- Legal-Tech Market in India
- Pharma supply chain
- direct consumer brands
- SaaS products for Indian market have very less chances to make $100M revenues.
Number of target customers x Penetration rate = Market volume
Market volume x price = market value
Task
- Who is your idea customer persona on the supply & demand side. If SaaS - who is your customer persona.
- What is the market volume of the supply (For ex: No of restaurants in Swiggy)
- What is the market volume of demand (For ex: Population or Percentage of people who can order food online)
- How many businesses exist that can buy your software (SaaS)
- How much revenue can be made per user or customer over a period of 5 years.
- What are the value added services that can be given to the customer to increase Average Revenue Per User. (Swiggy Food + Swiggy Stores, Freshdesk + Freshmarketer + Freshsales)
- Does the market have enough purchasing appetite