On this blog, we often cover startups, small or solo businesses use business modeling and how to get clear about the kind of business models.
A business model is just a way to capture value. There isn't a right or wrong business modeling, but instead finding the proper business model is a matter of experimentation, tinkering, and tweaking.
That is why startups and small businesses don't need grandiose plans but just simple tools to assess in a single page how to act.
That is also why tools like business model canvas, lean startup canvas, and value proposition canvas help entrepreneurs get clear about their business models, unique differentiator and value proposition:
I argue that looking and finding a business model is almost like a quest for meaning.
In fact, just like a human being doesn't find happiness in life until she's not able to define a meaningful way to live.
So businesses won't be able to capture value in the long run if they don't find their proper business models.
Manu entrepreneurs believe that business modeling is about monetization. While finding a business model is also about the revenue model chosen by the entrepreneur that is just a build block.
In fact, tools like business models canvas have several building blocks that are critical to have a holistic assessment of any business.
In this specific session we're looking at five business models:
- Google business model
- Amazon business model
- Apple business model
- LinkedIn business model
- Quora business model
There are a few things to keep in mind about a business model.
Business models are dynamic
Many have the impression that a business model is something static, that doesn't change. However, business models do vary.
In fact, for smal businesses and startups in most cases finding the proper business model is a quest.
And even when they find it, they need to keep tweaking it to allow a growth sustained by the value creation for several players.
Take Amazon, when it started it only sold books. Today Amazon sells pretty much anything.
While the value proposition hasn't changed much. Its business model is changing a lot. In fact, Amazon is willing to win the golden globe to sell more shoes.
"Business-market fit" isn't a short-term game
Finding the proper business model is even harder than achieving product-market fit.
In fact, you might have a product or service that finally has a market. But if that product or service sits on top of a business model that is not sustainable, it doesn't matter how much tinkering you do. Eventually, your business will fail.
Once you find the proper business model you're fine for a long time
When Google switched to become an advertising company its growth in revenues was exponential.
In a few years, it took over the online advertising industry. The same happened with Facebook.
Finding a business model that unlocks value means winning the lottery ticket as for a long time the company will keep producing a stream of revenues that guarantees profitability and cash flows that can be invested in another part of the business.
A business model is also about you
Unless you run a large corporation or a startup that take outside investments finding a business model isn't just about growing.
Instead, that is about what kind of business model would fit you best as a person. What would make you happier? What would unlish your creativity? What would give you more freedom?
In short, it is as much abou unlocking intangible values rather than money.
Have you found your business model yet? Let us know!