Why “We’ll Expand the Market” Doesn’t Convince VCs

“We’ll expand the market” is one of the fastest ways to lose a VC.

Expansion itself isn’t the issue. It’s often the right TAM story.
The issue is that most founders can’t explain how the market gets bigger.

They show a large number and skip the mechanism.
This Drop is about fixing that.

Founders usually start with the biggest imaginable market and work backward until it vaguely touches reality.

VCs work forward. They want to understand who buys today, who can’t buy today, and what changes if the product works.

If those answers aren’t clear, the TAM number doesn’t matter.

Credible market expansion follows a simple structure:

Wedge → Constraint → Unlock → Expansion

This isn’t about storytelling. It’s about making your assumptions explicit.

The wedge is the market that exists today. You should be able to name the customer, the budget, and the contract value.

The wedge has to stand on its own.

If it can’t support a meaningful outcome, future TAM won’t save the pitch.

Expansion comes from people who want the outcome but can’t access the product yet.

It’s not “everyone.”
It’s a specific segment that’s blocked today for a clear reason.

If you can’t name that buyer, there’s nothing to expand into.

Markets expand when a real constraint is removed.

That constraint is usually cost, complexity, speed, required expertise, onboarding friction, compliance, or access.

If you can’t explain the constraint in one sentence, the expansion story won’t land.

What actually changed?

Did cost drop enough to change who can buy?
Did onboarding shrink from weeks to minutes?
Did the product stop requiring specialized staff?
Did compliance become automatic?

This is the part investors care about: not the ambition, the change.

Strong expansion stories don’t sound novel. They sound obvious in hindsight.

Canva didn’t convince people to care about design. It removed the Adobe barrier.

Stripe didn’t teach small businesses about payments. It turned a multi-week merchant account process into a few lines of code.

The market didn’t appear. It was UNBLOCKED.

“We’ll educate SMBs to care about cybersecurity” doesn’t explain expansion.

“Existing tools required in-house security teams. We automate the work, so teams that couldn’t buy before now can” does.

That’s market expansion: a blocked buyer becomes a buyer because something real changed.

VCs aren’t afraid of small markets. They pass when founders can’t explain how a market gets bigger.

A credible expansion story sounds like this:

Expansion is upside. It’s not the justification for the round.

I built the Expansion TAM Calculator to make this concrete. It forces a clean separation between what exists today, what’s blocked, and what changes if the product actually works.

What it does:

This is for pressure-testing assumptions, not inflating numbers.
If the wedge doesn’t work, nothing downstream does.

Start with the wedge and make sure it stands on its own.
Then explain who can’t buy today and what changed that makes them a buyer.
Size that segment bottom-up and let the investor decide how much upside to underwrite.

If you do this well, you won’t hear “the market feels too small.”
You’ll hear: “Walk me through how that unlock actually plays out.”

Stop saying “we’ll expand the market.”

Say what actually changed:
We removed [constraint] that blocked [segment] from [value], and here’s the evidence.

Remember: you’re the expert on the market you’re building in. VCs will underwrite TAM expansion if they understand the mechanism.

Your job is to make that mechanism obvious.