TAM Isn’t Everything: Index’s Jahanvi Sardana Urges Founders to Focus Elsewhere
At TechCrunch All Stage in Boston, Index Ventures partner Jahanvi Sardana challenged the startup world’s obsession with Total Addressable Market (TAM). She argued that many iconic companies—for example, Google, Amazon, Microsoft—emerged from markets that didn’t exist when they began. According to Sardana, anchors like cloud or search were born, not found. Instead of chasing big numbers, she says, founders should focus on constructing strong product-market fit, solving real problems, and understanding customer behavior deeply. These insights came during her breakout session at the July 2025 event.
Rethinking Market Categories: Known, Emerging, Invisible
Sardana breaks down TAM into three categories. First is the known market, where incumbents already exist, and startups must argue why their offering is strictly superior. She emphasized that slicing off market share isn’t enough—you must show a compelling reason why users would switch. Second, the emerging market includes early users of a solution that might expand. Think non-alcoholic beer before its mainstream moment; the opportunity exists, but conviction matters. The third category—what Sardana calls the invisible market—is the most complex. These are sectors where a problem is only revealed once someone offers a solution, like smartphones or cloud computing in their early days. Investors must see how founders can create demand, not just serve it.
TAM Slides: Use Them Wisely—or Don’t Overuse Them
Founders often feel compelled to add TAM slides to their decks. Sardana doesn’t discourage that outright—she acknowledges the math can support a vision. But she warns: relying too heavily on industry reports or generic data can signal a lack of intimate knowledge about your own market. Instead, she recommends founders lean on unique insights, direct customer interviews, and behavioral evidence to show they’ve thought deeply about demand. At TechCrunch, she pointedly added that founders who rely on boilerplate metrics often don’t inspire confidence from savvy investors.
Case in Point: When Airbnb Outgrew Predictions
Index Ventures famously passed on Airbnb early on because its TAM estimate seemed too small. Sardana used that anecdote to highlight a broader lesson: founders often underestimate potential. Airbnb didn’t just capture existing hotel customers—it unlocked a massive new supply base in homes. That unexpected supply creation changed travel behavior globally. Sardana suggested founders explain how they plan to unlock supply or shift behavior, not just measure a slice of the market. That kind of insight reveals ambition and strategic thinking.
Investors Bet on Founders, Not Just Markets
When asked what catches her attention as an investor, Sardana emphasized the importance of founder grit and clarity of vision. She noted that markets are a lens on ambition—not the focus itself. A founder who understands who their customer is, and why that person will pay, can impress investors far more than large charts. Index Ventures often evaluates teams over markets, looking for persistence, strategic thinking, and empathy rather than polished numbers.
Why This Perspective Matters Now
In today’s startup environment—where headlines hype enormous markets and valuations—Sardana’s message feels timely. Founders are under pressure to show relentless growth potential via quantified TAM. But her message reframes the debate: build something that solves a problem people didn’t know they had, earn their behavior change, and back it up with evidence, not just projections. She argued that AI now represents the biggest wave, and founders must ask themselves: is your product positioned to ride it effectively?
Wrap-Up: Founders, Focus on the ‘Why’ Not Just the ‘How Many’
Jahanvi Sardana’s session at All Stage reminded early-stage founders that scale doesn’t come from sizing alone—it’s born from insight and execution. Whether entering a known, emerging, or invisible market, success depends on the founder’s ability to shape demand, empathize with customers, and build a product that delivers genuine behavior change. Investors will reward clarity of vision and founder conviction more than industry slide decks. Her core takeaway: “Understand your customers, not just your charts.”
