Run a market sizing sanity check

Market Sizing: Triangulate or Don't Cite

Single-method market sizing produces numbers that don't survive due diligence. Paul Graham's writing on startup ideas and Y Combinator's library both advocate triangulation: top-down from analyst reports, bottom-up from unit economics, and analog from comparable markets. Convergence within 2x indicates medium confidence; divergence >3x means something is wrong.

How the Run a market sizing sanity check Prompt Works

The prompt produces three independent estimates and checks convergence. The "single biggest assumption across methods" output is the honest diagnosis — every sizing rests on a load-bearing assumption, and naming it lets the reader evaluate the number credibility.

When to Use It

• A fundraise is starting and the TAM slide needs defense.
• A board is questioning an existing market size claim.
• A new segment pivot needs a fresh sizing estimate.
• A product launch requires a go-to-market prioritization.
• A previous estimate has drifted and needs re-validation.

Common Pitfalls

• Single-method sizing. One number has no validity check. Triangulate or don't cite.
• Ignoring divergence. When methods disagree by >3x, the usual response is picking the biggest number. Better response: figure out which is wrong.
• No honest uncertainty. A sharp number without uncertainty range overstates confidence. Range > point.

Sources

• How to Do Great Work — Paul Graham
• How to Get Startup Ideas — Paul Graham
• Y Combinator Library — Y Combinator
• The Product Strategy Stack — Reforge