How do you project revenue for a product that hasn’t been shipped yet? Our leadership team wants to understand how fast it will grow.

Start with a Total addressable market (TAM) * share of TAM you can get in next 3-5 years *confidence level *Revenue per user per year * 3-5 years. In the RICE framework, you would divide TAM * Share of TAM (influence) * Confience/ Effort to then help prioritize. (Desc) Calculating Share of TAM you can get in next 3-5 years is a art more than science. Do a SWOT analysis for yourself, incumbents in the market, if any and emerging players. Also keep in mind that market/users may not always be ready ...Read More

I don't really have a "scientific" answer to this - I've always done this in 2 ways: creating a bottom-up model, and trying to find data from other companies/competitors to benchmark against. Bottom-up model I've usually done this in a giant spreadsheet, trying to build a model with a lot of documented assumptions. Here's how we did it for Jira Product Discovery: First, decide on how we would package and price the product, which we did via conversations with our early lighthouse customers, a sur ...Read More

So, in my experience of building 0-to-1, I've never had to do this before exploring a potential new product 😅 and candidly, I really don't like doing it because any projections are in my experience educated guesses based on inherently flawed source data - historical data that may not apply anymore, all sorts of biases, differences between other products and your new product, etc. What I try to do instead of offering revenue projections is work with my leadership/stakeholders/et al to understand ...Read More

When setting up any new line of business, revenue projection is an important step to understand the expected outcomes and viability of the business. For new a new product, you should have: The basic market analysis including market sizing and TAM (total addressable market) Competitor growth rates and revenue acquisition at comparable stages of growth The market segment you are positioning the product in, and its current and projected growth rate Revenue and monetization strategy for your new pro ...Read More

Projecting revenue for a 0 to 1 product isn't an exact science, especially if its product in a new category. That said, here are two approaches depending on the type of product: If the product is in an existing category, you can: Estimate TAM (Total Addressable Market) based on adjacent products. Use benchmarks or comparables (market share, average deal size, pricing models). Model adoption over time — early adopters → mid-market → broader orgs. If it’s a new category, starting from first princi ...Read More

Honestly, any revenue projection for a 0 to 1 product is an educated guess. The goal is to make it a structured, defensible one. Here is how I approach it: Start with the addressable problem, not the product. How many customers have this problem today? Of those, how many are likely to pay for a solution? That gives you a ceiling before you ever model a growth curve. Use proxies, not predictions. Look at comparable product launches, internally or externally. How did similar features or products r ...Read More

There are three methods I have used for forecasts of revenue with new product delivery: Bottom-Up Market Sizing Start with your Total Addressable Market (TAM), then narrow it down to Serviceable Addressable Market (SAM) and Serviceable Obtainable Market (SOM). Customer Acquisition Funnel Modeling Estimate conversion rates at each stage based on industry benchmarks, competitor data, or early testing results. Pilot and Beta Program Data If you have any early users, beta testers, or pilot programs, ...Read More

Leadership likes hard numbers- actually we all probably do. But, providing hard numbers requires a skill all of lack- forecasting the future. While you can't provide a guaranteed revenue number, you can certainly share an educated guess. Start with TAM + first cohortWhat’s the total market? Now zoom into your target segment for v1. Who are you actually building for, and how many of them are there? What are your indicator/success metrics?% of market you’ll reach, % who’ll convert, price point, re ...Read More

There are a couple of different things you have to do and validate that can help demonstrate the revenue potential.  You have to do is TAM (Total Addressable Market) analysis. For this, you are looking for industry reports - how an industry has grown, how spending has grown, back of the envelope calculation in how big the market size is From this, you get into the SAM (Serviceable Available Market), what portion of the TAM you will serve based on your product. You can extrapolate that if you alr ...Read More

Projecting revenue for a product that hasn't shipped yet can be challenging, but there are some steps you can take to estimate potential revenue: Define your target market: Start by defining your target market and estimating the size of the market. This will give you an idea of the potential customer base for your product. Estimate market penetration: Estimate the percentage of the target market that you can realistically capture with your product. This will depend on factors such as competition ...Read More

If this is a brand new product (i.e no existing product in market) you can go the TAM route: Do a total addressable market (TAM) analysis - you can either use public sources or pay for private sources to understand the market size. Make sure you understand the specific segments in your TAM. Determine what market share you already have from that TAM. Determine how much additional market share you expect to have and in how much time. Based on your average sales price (ASP) you can then determine w ...Read More

Start by mapping your leading and lagging metrics  Leading metrics examples include sales and customer engagement, customer usage  Lagging metrics examples include bookings, revenue, retention rate, upsell  It is critical to plan your leading engagement KPIs, especially in new product launches. Think of these as your early indicators of success. For eg:  Sales metrics like number of outreach efforts, response rates, opportunities created, conversion rates Customer engagement metrics like daily o ...Read More

Projecting revenue for a product that hasn't been shipped yet can be challenging since it involves forecasting future outcomes based on limited information. However, you can utilize several approaches to estimate revenue growth, listing a few of them below: Conduct market research to understand market size, growth rates, and revenue potential. Determine the total addressable market (TAM) and assess revenue potential within each market segment. Define pricing strategy and business model, consider ...Read More

Projecting revenue for a product that hasn't been shipped is a tough but essential exercise for any organization. Some key inputs are: Market size and potential addressable market: important to clearly understand and define the target users/customers and overall market size you are going after. Competitor size and metrics: how large are the competitors? What core metrics are they going after? Product pricing model: What is the pricing strategy your product would go after? Freemium, subscription, ...Read More