I try and start with a combined top-down / bottom-up exercise.
Top-down: what are the top 1-3 business objectives that we can move the needle on with product work? Let's prioritize those.
Bottom-up: what is the bare minimum keep-the-lights-on staffing level required to run our service / business?
If there is any surplus from this exercise, you take on more of the backlog and can do more ambitious thing. If there is a deficit, time to deprioritize certain investment areas until the team is staffed to a healthy level.