3 Business Model Canvas

BUSINESSMODELCANVAS
BUSINESS MODEL
Description of all
the parts of the
company necessary
to make money
 The
 The Business
Business model
model canvas
canvas is
is a
a strategic
strategic
management template
management template for
for developing
developing new
new
or documenting
or documenting existing
existing models.
models. It
It is
is a
a
visual chart
visual chart with
with elements
elements describing
describing a
a
firm’s value
firm’s value proposition,
proposition, infrastructure,
infrastructure,
customers, and
customers, and finances.
finances. It
It assists
assists firms
firms in
in
aligning
aligning their
their activity
activity by
by illustrating
illustrating
potential trade-offs.
potential trade-offs.
BUSINESS MODEL
CANVAS
Business Plan vs Business Model
BUSINESS PLAN BUSINESS MODEL
• Takes too long to write • A business model
• Seldom Updated describes the rationale of
• People who ask you to how an organization
make a business plan creates, delivers and
won’t have requisite time captures value.
to read it • Models are Dynamic
• Plans are static
6 4
8 2 1
7 3
9 5
• For whom are we creating value?
• Who are our most important customers?
Notes: If you’re spending a lot of time on this first
item, that’s OK (and it’s probably good).
Customer Segment Types
For whom are we creating value
 Mass Market
 Niche Market
 Segmented Market
 Diversified Market
 Multi-side Platforms
• What value do we deliver to the customers?
• Which one of our customer’s problems are we helping to solve?
• Which customer needs are we satisfying?
• What makes us unique compared to the competition?
Elements of the Value Proposition
What are you offering to them?
 Newness
 Performance
 Customization
 Brand/Status
 Design
 Price
Spotify: “Music for Everyone”
Product: Online streaming music.
Target market: Families and single people alike.
Primary benefit: Music on the go.
What makes it unique? Moms, dads, kids, singles…
there’s music to suit everyone’s tastes, all in one app.
Vimeo: “Make Life Worth Watching”

Product: Online video streaming.
Target market: People who want to upload and/or watch video.
Primary benefit: A simple platform for watching, uploading,
and sharing video.
What makes this value proposition unique? Focuses on
the intrinsic value and artistic nature of a well crafted video.
• Through which Channels do our Customer Segments want to reached?
• How are we reaching them now?
• How are our Channels integrated?
• Which ones works best?
• Which ones are most cost-efficient?
• How are we integrating them with Customers routines?
4 things to consider in Channels
• Product
• Market
• Middlemen
• Company
Types of Channels
Through which channels the customer segment can be reached?
 Sales Force
 Web sales
 Own stores
 Partner stores
 Wholesaler
 Retailer
• What type of relationship does each of our Customer Segments
expect us to establish and maintain with them?
• Which ones have we established?
• How costly are they?
• How are they integrated with the rest of our business model?
Types of Customer Relationships
What type of relationship should be established and maintained with CS?
 Personal assistance
 Self-service
 Automated services
 Communities
 Co-creation
 Dedicated personal assistance

REVENUE STREAMS
• What are customers really willing to pay for?

• How? Are you generating transactional or recurring
revenues?
Types of Revenue Streams
For what value the CS are really willing to pay?
 Asset sale
 Brokerage fee
 Subscription fees
 Renting/leasing/lendin
 Licensing
 Advertising
• What Key Resources do our Value Propositions require? our Distribution
channels? Customer Relationship? Revenue Streams?
Types of Key Resources
What key resources do the value proposition require?
 Physical
 Intellectual
 Human
 Financial
 Natural
• What Key Activities do our Value Propositions require?
• Distribution channels? Customer Relationships? Revenue
streams?
Types Activities
What key activities do the value proposition require?
 Production
 Problem solving
 Platform/networking
 Partnership
 Service
• Who are our key Partners? Who are our key Suppliers?
• Which Key Resources are we acquiring from partners?
• Which Key Activities do partners perform?
Types of Key Partners
Who are our key partners?
 Strategic alliance
 Joint ventures
 Cooperation
 Buyer-supplier
 Franchising
• What are the most important cost inherent in our business?
Which Key Resources are most expensive?
• Which Key Activities are most expensive?
Definitions
Costs that remain the same over a period of
time
Fixed
Costs
Ex. Monthly Salary, Annual / Monthly Rent, Cost
of Machines
Are costs which are heavily dependent on the
Variable volume of output a company produces
Costs
Ex. Raw Materials, Utility Costs
Costs decrease as production increases. The
Economi higher the volume, the lower the overall cost
es of per unit.
Scale
Ex. Bulk buying, Mass production, Mass Market
Costs are decreased by investing in
businesses related to the core product
Economi
es of
Types of Cost Structures
What are the most important costs inherent in the business model?
 Cost-driven
 Value-driven
 Fixed costs
 Variable costs
 Economies of scale
6 THINGS TO CONSIDER
NO BUSINESS PLANS SURVIVE THE FIRST
CUSTOMER CONTACT
Business plans are for the known future, it does not work in the start-
up context
IT’S THE BUSINESS MODEL THAT

REALLY MATTERS
Figure out and validate how the business will earn
TAKE TIME TO THINK THROUGH ALTERNATIVE

POSSIBILITIES
The art of pivoting: the same technology, product or service can have
numerous business models.
6 THINGS TO CONSIDER
YOUR BUSINESS MODEL IDEA IS JUST A
SET OF HYPOTHESES
Adapting the business model until proven really works.
IT’S THE BUSINESS MODEL THAT REALLY

MATTERS.
Business model describes the rationale of how an organization creates,
delivers, and captures value.
Don’t forget your customer-driven product

Business models won’t work without the right product.
Group Activity
• 1 hour to create your BMC
• Presentation

3 Business Model Canvas

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BUSINESSMODELCANVAS

Vimeo: “Make Life Worth Watching”

 Dedicated personal assistance

• What are customers really willing to pay for?

IT’S THE BUSINESS MODEL THAT

TAKE TIME TO THINK THROUGH ALTERNATIVE

IT’S THE BUSINESS MODEL THAT REALLY

Don’t forget your customer-driven product

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