“They'll say okay well TAM's 100 million people and we're going to go and acquire like 5% and call it a day. In reality when you start digging in you find out that our product isn't something that's going to service all 100 million of these people — it's going to service some fraction.”

The 5%-of-TAM fallacy — the 100M never existed as addressable

The classic founder modeling mistake: pick a big TAM, assume you'll capture some round percentage, build a plan on it. The 100M was never addressable in the first place. The 5% number is fiction layered on top of fiction.