Applying to the Innovation Pathway Step 3: Opportunity Sizing

You’ve validated that real people have a real problem, and you’ve mapped what already exists to solve it. Now comes the crucial question: Is this problem big enough to build a meaningful venture around?

We need to see your “Opportunity Size Hypothesis“—evidence that you’re not just solving a problem for you and your three friends, but addressing something that affects enough people in a significant enough way to create real impact. Whether you’re building a for-profit venture or a nonprofit organization, demonstrating the scale of need is essential.

The Big Picture Question

Whether that’s a sustainable business opportunity or a social need significant enough to warrant a nonprofit solution. You need to show three things:

  1. Scale: How many people/organizations have this problem?
  2. Frequency: How often does this problem occur?
  3. Severity: How much do people care about solving it?

If any of these is too small, your opportunity might not be worth pursuing—or, at least not yet.

The Simple Math Approach

Start with straightforward questions and rough math:

Who Has This Problem?

Be specific about the group of people you’re focused on. Start narrow, then expand.

Example progression:

  • Ultra-specific: “BU students living in dorms who order food delivery”
  • Campus-wide: “All BU students”
  • City-wide: “College students in Boston”
  • National: “College students in the US”
  • Broader: “All people aged 18-24 in urban areas”

Your research toolkit:

  • University statistics: How many students at BU? In Boston? In the US?
  • Census data: Demographics for your target age group or location
  • Industry reports: Google “[your problem] statistics” or “[your target group] market size”
  • Association websites: Student groups, professional organizations, etc.

How Often Does This Happen?

Turn the problem from a one-time thing into a pattern.

Ask yourself:

  • Does this happen daily? Weekly? Monthly? Once per semester?
  • Are there seasonal patterns? (e.g., more stress during finals, housing issues at semester start)
  • Does the frequency increase over time? (e.g., as people get busier, older, more experienced)

Example calculation:

  • 10,000 college students (who)
  • Order food delivery 2x per week (frequency)
  • For 30 weeks per school year (duration)
  • = 600,000 food delivery moments per year where your problem could occur

How Much Do They Care?

This is where your earlier interviews become crucial. Look for evidence that people would actually change their behavior or spend money to solve this.

Strong signals:

  • People already spend money on inadequate solutions or donate to related causes
  • They spend significant time on workarounds
  • They express genuine frustration (not just “yeah, that’s annoying”)
  • They’ve actively searched for better options or support

Weak signals:

  • Responses like “I guess that would be nice”
  • No one has ever tried to solve it for themselves
  • People seem content with current workarounds
  • Low emotional response when you describe the problem

The Three-Circle Framework (TAM/SAM/SOM)

These three concepts help you think about your opportunity at different scales:

Total Universe (TAM – Total Addressable Market)

If you solved this problem perfectly for everyone who has it, everywhere, how big could this get?

This is your “dream big” number. Don’t worry about being precise—think order of magnitude.

Example: “Food delivery apps market = $150 billion globally”

Your Realistic Target (SAM – Serviceable Addressable Market)

Who could you realistically serve with the resources and approach you’re likely to have?

This is where you get more honest about geography, demographics, and your actual capabilities.

Example: “College students in major US cities = $2 billion subset of food delivery market”

Your Starting Point (SOM – Serviceable Obtainable Market)

Where will you start, and how much of that initial segment could you capture?

This is your first step—the smallest viable group you could serve well.

Example: “BU and nearby college students = 50,000 students × $200/year food delivery spending = $10 million potential market”

Refine Your Numbers with Data

The Bottom-Up Build

Start with what you can count and work your way up:

  1. Count your immediate environment
    • How many people in your dorm/class/organization have this problem?
    • Extrapolate to your entire campus
  2. Find comparable data
    • Look up similar campus sizes nationally
    • Research demographic data for your target group
  3. Test your assumptions
    • Does your math pass the “smell test”?
    • Would your friends agree with your estimates?

The Sanity Check Questions

Before you finalize your numbers, ask:

  • Does this feel too big? If you’re claiming a billion-dollar opportunity, make sure you have strong evidence
  • Does this feel too small? If your total market is under $10 million, consider whether this is worth pursuing
  • Can you defend these numbers? Could you explain your reasoning to someone who’s skeptical?

Common Questions

“What if I can’t find exact market size data for my specific problem?” Use proxies and related markets. If you’re solving a problem for “students who struggle with time management,” look at productivity app markets, academic coaching services, or student software markets.

“How precise do these numbers need to be?” Not very. The Innovation Pathway wants to see that you’ve thought seriously about scale, not that you can predict the future. Orders of magnitude matter more than decimal places.

“What if my market seems small compared to big tech companies?” A $10 million opportunity can still support a meaningful business or provide significant social impact. Focus on whether it’s big enough for your ambitions and whether it could grow over time.

“Should I include adjacent markets I could expand into later?” Mention them, but focus on your core opportunity first. Expansion potential is bonus points, not the main event.

Your Action Plan

  1. Define your target group precisely (who has this problem?)
  2. Research the size of that group using online sources, government data, industry reports
  3. Estimate frequency based on your interviews and observations
  4. Calculate your rough market size using simple multiplication
  5. Sanity-check your numbers with friends, advisors, or online communities
  6. Document your methodology so you can explain how you got these numbers

Sample Framework

Here’s a template you can fill in:

  • Our core target: [Specific description of who has this problem]
  • Size of this group: [Number of people/organizations]
  • How often they experience the problem: [Frequency]
  • What they currently spend solving it: [Time, money, effort]
  • Our total opportunity: [Your math]
  • Our realistic starting point: [Narrower initial target]

Learning Resources

Want to dive deeper into market sizing and business analysis? Check out these resources from the Innovate@BU library:

  • “Disciplined Entrepreneurship” by Bill Aulet – Step-by-step approach to market sizing and opportunity assessment (see Step 5: Estimate the TAM for Your Beachhead Market)
  • “Absolute Essentials of Marketing Research” by Kolb & Fuller-Love – Comprehensive guide to gathering and analyzing market data
  • “Big Data Analytics: Applications in Business and Marketing” by Chaudhary – Modern approaches to understanding market size using data

What Comes Next

Once you have a clear sense of your opportunity size, you’ll be ready to put together your pitch for the Innovation Pathway panel. You’ll need to tell a compelling story that weaves together your validated problem, competitive landscape, and market opportunity into a case for why this is worth pursuing.

Remember: The goal is simply to demonstrate that you’ve identified a meaningful problem affecting enough people to justify the effort of solving it—whether through a scalable business model or an impactful nonprofit approach.

Ready to make your case to the panel? Read our tips for putting together a winning pitch >

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