CRED's co-founder and CEO, Kunal Shah, shared his perspective on startup founders' challenges in raising venture capital to grow their businesses.
According to CRED founder Kunal Shah, many founders need to pay more attention to assessing the market size their product serves.
He suggests that utilising an AI tool capable of reading and analysing extensive market data can assist founders (at least first-timers) in determining if their product or service has a substantial total addressable market (TAM).
Venture capital refers to funding provided by firms to startups to achieve rapid and exponential growth.
Shah wrote on X, “Many founders struggle to raise venture capital because the problem they're solving has a very small TAM.
An LLM-based tool to size their TAM could be valuable for first-time founders.”
Social Media Reaction:
Online users reacted positively to Shah's statement while a few don't agree with Shah's words.
One user wrote, "An LLM can definitely serve as a mentor or consultant, helping founders think with structured frameworks. Agentic solutions like Autogen or CrewAI might be the way to go."
Another user commented," Leading to even more hallucinations about market sizes? But seriously, IME the TAM Problem is rooted in founder's failure to think creatively/strategically about their customers, competitors, and the company and products they plan to build. Seems LLM-based tools will eloquently repackage generic stats and conventional wisdom, and lead to even more Me-Too Startups that are destined to fail in fiercely competitive markets."
A third user replied, "It’s probably not the TAM, perhaps TEM is what the VCs sometimes don’t get and categorize that as non VC backable venture. This LLM tool will be more helpful for the VCs. I believe founders have their clarity of whatever the market size is."
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