TAM - Compoundly (A)
The total addressable market (TAM) for Compoundly is estimated at $57.2 billion.
Compoundly’s Offerings and Target Market
- According to its LinkedIn profile, "Compoundly empowers everyday investors to control their financial future by delivering a suite of sophisticated, objective, and customized financial tools."
- Specifically, Compoundly aims to help individual retail investors in identifying and reducing investment fees charged by their financial advisors and/or money managers. In addition, the company targets retirement account holders by identifying and reducing fees associated with retirement accounts.
- The company is based in New York and aims to serve customers in the United States.
Financial Planning and Advice Market
- The "Financial Planning and Advice" market, also known as "Financial Planning and Investment Advice" market is composed of companies that offer financial planning, financial advice, and wealth management products and services.
- According to IBISWorld, the main activities in this market are fee-based financial investment advice services and financial planning services. In addition, the key services in this market are personal financial planning and advice services and personal investment management services.
- One of the main drivers of this industry is the aging US population. An increase in the share of the US population that has reached or is approaching retirement age is directly linked with an increase in the demand for retirement planning services, thus adding to the industry's revenue growth.
- Data from IBISWorld indicates that the size of the financial planning and advice market in the US is $57.2 billion in 2020.
- The definition, activities, and main services in the financial planning and advice market as well as a review of the target customers, service offerings, and value proposition of Compoundly indicates that the company operates in the US financial planning and advice market.
Compoundly’s Total Addressable Market (TAM)
- Total addressable market (TAM), also known as total available market, is the total market demand for a product or service. In other words, it is "the maximum amount of revenue a business can possibly generate by selling their product or service in a specific market."
- Hence, the total addressable market (TAM) or the total available market for Compoundly is the overall revenue opportunity it has if it achieved 100% market share in the financial planning and advice market.
- This means that Compoundly's TAM would be equal to the size of the US financial planning and advice market i.e., $57.2 billion.