TAM doesn’t matter. I don’t track it, that is an analyst’s job, says Lenskart’s Peyush Bansal

Peyush Bansal, CEO and co-founder, Lenskart, the IPO bound eyewear retailer, said he is not focussed on what the total addressable market (TAM) is for his company and he does not track the metric.

TAM, or Total Addressable Market, is a foundational concept in startup and venture capital analysis. It essentially indicates the total revenue opportunity available for a company for their product or service when they start off. It helps estimate how much money a company can make by selling to how many people if the entire cohort is tapped in the targeted space.

Lenskart says it has an opportunity to serve 500 to 700 million (50 to 70 crore) people. However, certain industry stakeholders say that number is overstated and the target group is much smaller.

Asked for his views, Bansal said: “It doesn’t matter. My co-founder says: ‘Ki farak painda hai? (What difference does it make?)’ It doesn't matter what the TAM is beyond a point. You go to any place and you do an eye test of 10 children, 10 adults and you can know what the TAM is. You don't need so many monitors and reports to do that. I don't get into this beyond a point, I don’t track it, this is an analyst’s job.”

Bansal, in an interview with Moneycontrol, said he has been asked questions around TAM earlier too but has always found it irrelevant.

“Around 10 years back when Chiratae Ventures had invested in us, a lot of the people used to say that the eyewear market in India is at $1 billion and I just couldn't get it. Even at those days I just couldn't get it how that number matters but I always used to say it doesn't matter. If it is Rs 5,000 crore, we can give vision to 50 percent of India and that is a sizable impact to create and so our job is not changing because of that,” he said in the interview to Moneycontrol.

Read the full interview: IPO not an exit event; Being a Promoter has an emotional angle: Lenskart’s Peyush Bansal