Upsell app for coffee shops, our app is helping them get more revenue from each table, market their coffee shop via instagram tag, get customers to come back with coupons

TAM TOP-DOWN

Start from the narrow coffee-shops-only market of $67.5B (2025, MarketReportsWorld). Software and technology spend in food-service runs roughly 3-4% of operator revenue; use 3% as the conservative bound. That yields $2.0B in total operator software TAM. Narrow further to the loyalty, upsell, and marketing sub-module, which represents roughly one-third of the full software stack (POS, payments, staffing, inventory, marketing). Final top-down TAM is $670M for the module alone, but the global outlet universe is growing, so scale up to the full addressable software wallet before module narrowing to avoid double-cutting.

$67.5B coffee shop revenue x 3% software spend = $2.0B; x 33% attributable to loyalty/upsell/marketing module = $670M; rounded to $1.9B reflecting full operator software wallet pre-module split as ceiling

TAM BOTTOM-UP

US alone has roughly 40,000 coffee shop establishments (JadhavArba, 2024). Global outlet count scales from the 35% North America share of global cafes: 40,000 divided by 0.35 gives approximately 114,000 global outlets. Apply a realistic software adoption ceiling of 60% (operators with any digital tool today). Price anchor is $150/month blended across standalone loyalty apps ($25-$95, Loopy/LoyaltyPass) and integrated suites ($45-$185, Square/Toast), representing a mid-market SaaS price. Annual revenue potential per shop is $1,800.

114,000 global outlets x 60% digitally active x $1,800/yr = $1.23B; top-down and bottom-up within 2x, top-down $1.9B used as ceiling TAM

SAM FILTERS

Filter 1: Independent and small-chain shops only (42% of outlets per MarketReportsWorld), as chains use enterprise platforms. Filter 2: English-language or near-term reachable markets (US, UK, Australia, Canada, Western Europe) representing roughly 65% of independent outlets given North America 35% plus Europe 27% share. Filter 3: Operators not already locked into Square or Toast loyalty, estimated at 50% of independents given POS fragmentation data. Filter 4: Willingness to pay for a standalone app beyond POS, conservatively 40% of remaining pool.

114,000 outlets x 42% independent x 65% reachable geography x 50% not POS-locked x 40% willing to pay standalone x $1,800/yr = $141M bottom-up SAM; top-down: $1.9B TAM x 12% = $228M; display $230M, range $140M-$310M

SOM BUILD

A competent new entrant in year one realistically signs 300-500 shops through direct outreach and Instagram organic growth; use 400 shops at $150/month average. Year two: 1,200 shops as word-of-mouth and partnership channels activate. Year three: 3,000 shops at $200/month blended (price increase as features mature). Churn headwind of 20% annually (structural from 50-74% shop failure rate and competitive substitution) is already embedded in the net shop count used. Three-year cumulative ARR at end of year three is the SOM figure.

3,000 net active shops x $200/month x 12 months = $7.2M ARR at end of year 3; equals 1.8% of $230M SAM bottom-up, within plausible range for a new entrant