Calculating market size by multiplying the exact number of potential customers by the realistic price they would pay, rather than relying on top-level industry reports.
Why it matters: Investors strongly prefer bottom-up sizing because it proves the founder understands the unit economics and the actual customer base, avoiding the 'we just need 1% of a $10B market' fallacy.
In practice: Finding there are 50,000 dental clinics in the US, and estimating 20% would pay $500/month for scheduling software, yielding a $60M SAM.