the-four-week-mba-top-business-models-for-2018

The Four-Week MBA Top Business Models For 2018

Back in December 2017, I had mixed feelings about what to do next in my life. On the one hand, I had been immersed for over a year in an entirely new adventure, taking care of the business development of a SaaS startup.

I had never had any experience in sales and distribution in my life before. I had running my solo project for a couple of years, but I came from a completely different background.

Graduated as a lawyer in 2011, I then switched my focus toward business and corporate finance with an International MBA between LUISS Business School in Rome, Italy and University of San Diego, California.

By 2014 I had become a financial analyst and assistant controller for a real estate investment firm in San Diego. During my years in California, I managed to convert my professional profile entirely from law to finance. Yet I wasn’t satisfied with my career path.

Indeed, I understood I was taking a narrow path that might have probably led me toward roles such as Controller and CFO, in the long-run. While those are pretty lucrative roles, I imagined myself in those shoes, and I didn’t like what I imagined.

Indeed, even though I enjoyed the strategic part of understanding companies by looking at their financials, I still wanted to be an entrepreneur and build my own business.

So without hesitation, I resigned, gave away an H1B Working Visa (those coming from outside the US know how valuable that is) and I just went back to Italy.

I figured that if I managed to put together a few info products about what I’ve learned during those years that would be enough to build a digital business, which generated passive income.

While I did that after only a couple of months from resigning, I was generating automatic income, with no marketing and just with organic reach. It wasn’t enough to be able to sustain me in the long-run.

Two years went by, and I’d managed to understand the several parts and bits of the digital marketing world. Yet I was far from the objectives I had set up for my business.

I realized that if I wanted to be an entrepreneur and business person in my life I needed to get well rounded also in two things which I had felt not worth my time: marketing and sales.

Fast forward; It took me over a year of thinking through it to realize that I needed to master sales, distribution, and marketing if I wanted to have any chance of long-term success for my business. So I set myself to gain some real-life experience on that.

That’s how I got in touch with WordLift in 2016, the company for which as of today (December 2018) I run the business development side.

I learned so many things in the last couple of years which confirmed what I always thought. There’s no better way to gain expertise than to be a practitioner, someone that works hard on execution but also takes the time to study the theoretical side of things.

That brings us back to that December 2017, when I was having those mixed feelings about what to do next. I was satisfied with what I had done so far, but something was missing.

I felt I lacked another critical element to becoming a better business person. I realized that to take a step forward I needed to understand how companies worked at their core.

I needed to understand how companies “thought,” and what made them successful. In short, I needed a framework to analyze any company quickly to extract their core values and have a holistic understanding of them.

That’s how I started to get passionate about the concept of “business modeling.

It wasn’t new to me at all, yet at that stage, I wanted to gain a deep understanding of it. So I considered different options. I narrowed them down to three possibilities:

  • go back to business school
  • enroll in a Ph.D. program
  • do my own research

The first two options were quite appealing as I could tap into the resources of academic institutions to learn as much as possible about the topic.

However, I also didn’t want to leave my job; I didn’t want to get out again from the real world to immerse myself in a purely academic environment.

So I started pondering what would turn out to be the best option. I took my existing blog which in the meanwhile was almost dead and decided I would grow it with the sole intent of sharing all the research I was doing about business models.

In short, I could motivate myself to keep researching into the topic while I could experiment with an entrepreneurial project where I’d turn a dead blog in a publishing outlet.

Fast forward December 2018, this is how it turned out so far:

fourweekmba-blog-traffic

While I’ve grown my blog, I’ve gained in the meanwhile a few other critical skills, from content marketing, publishing, and SEO.

Thus, I leveraged on my previous financial and business background, what I’ve learned throughout my experimentations with publishing and the sales and distribution skills I’ve learned on the job.

In the meanwhile, I’ll continue my research for 2019 (remember a Ph.D. lasts at least five years).

I want to share now which business models have turned out to be most interesting to you, my reader! Below the list.

Amazon Business Model 

Amazon has conquered the world with its cash machine business model and its ability to disrupt several industries. It started out as a library online, and it ended up as the everything store.

RelatedHow Amazon Makes Money: Amazon Business Model in a Nutshell

DuckDuckGo Business Model

As privacy concerns grow and people get more aware of how Google works and makes money; that opens up new possibilities for DuckDuckGo, that while still a small search engine compared to Google, it might play a key role in the coming decade.

Netflix Business Model

Netflix‘s founder Reed Hastings understood the importance of the Internet and the Internet TV back in the late 1990s.

Yet opposite to Microsoft which tried to build an internet TV network too yearly, Reed Hastings was patient enough to allow Moore’s Law (the capacity of technology to double about every two years in computing power) to pick up.

Indeed, when he started Netflix, he had to make it first an on-demand DVD company, by knowing it would only be a transition. Yet when they forecasted back in the 2000s they would become a streaming company in the coming five years, they were completely off.

So they made again the same forecast and once again in 2007 they were off. Yet when 2012 came, Netflix was still off in its forecast. Why? Its streaming business had grown way faster than any expectation! Vision helped Netflix go through that period.

That is why you need to be in love with your business. A successful company is the fruit most of all of the execution. If I had to give a – personal – estimate of how much between idea, vision, and execution matter, I’d say 10% the idea, 40% the vision and 50% execution!

TOMS Business Model

After a trip to Latin America, Blake Mycoskie realized how shoes were so precious in countries like Argentina where kids contracted many diseases due to the lack of shoes.

He came up with an innovative business model that mixed for profit with nonprofit — a model that would take part of its earnings and give it back to others. He called it a one-for-one business model.

In short, it started with a simple yet powerful action: for each pair of shoes sold a pair would be given back to countries like Argentina where they needed it the most.

TOMS is a perfect example of how a business model can make a difference between a successful and thriving organization.

Google Business Model

Today Google is among the FAANG companies, those tech giants – that so far – dominated the globe. While we don’t know for sure how long will those companies succeed in keeping their dominance, they’ve already changed the world as we knew it.

When Google came into existence, it was not the first search engine. It was actually among the last entrants of the search industry, in a time where companies like AOL dominated the web, search was seen as a secondary feature of those web portals.

While Google was an incredible tool, 10x better than its competitors, its success wasn’t just due to its algorithms. It was primarily due to its distribution strategy and its innovative business model.

Indeed, Google closed a few initial deals with AOL, where it got such a massive exposure to growing exponentially in a few years. Google copied part of another search engine business model, called Overture.

It also innovated in comparison to it by adding a bidding mechanism to keywords that also allowed to rank those paid text listings based on relevance, primarily measured via click-through rates!

PayPal Business Model

From the PayPal Mafia (the group of people that blitzscaled PayPal) entrepreneurs like Elon Musk, Peter Thiel and Reed Hoffman would later found other successful companies in Silicon Valley.

Sold to eBay for over a billion dollars PayPal represents one of the most interesting cases of how companies can scale fast by starting from a narrow niche. Indeed, when PayPal identified the power users it needed to dominate its niche it went after them with the maximum determination.

While growing a successful company is also a matter of luck, PayPal also enjoyed of a group of very smart people that made it a multi-billion company in a short span of time, by revolutionizing the payment industry.

Apple Business Model

Everyone knows of Steve Jobs’ heroic mission to bring Apple from a failing tech company to become a world’s leader again, with the iPod, iPad, iPhone (and maybe Apple Glasses in the future? this is pure speculation).

Apple has a smart business model based on a razor and blade strategy on the one hand. On the other side what makes Apple unique is its ability to combine tech with luxury and locked-in ecosystem that have incentives for smart developers to build tools and apps people love!

Microsoft Business Model

Most people still associate Microsoft with the set of desktop tools that became a massive commercial success installed almost on any PC on earth. I’m referring to the Windows Office Package.

While a good chunk of Microsoft revenues still come from it, the company has changed dramatically over the years. Indeed, for a tech company to survive transformation it the key ingredient.

Microsoft today has a diversified business model that relies on several revenue streams. Just to mention a few of the companies and products run by Microsoft, there is Xbox in the gaming industry, Bing in the search industry, and LinkedIn in the social network industry!

Walmart Business Model

Even though companies like Amazon are making more and more difficult for more traditional companies like Walmart to survive, the company has managed to pass through several generations still as one of the American conglomerates, and it made over $495 billion in revenues for 2017, and its secret was cross-docking.

Baidu Business Model

I defined Baidu the Google of China. I wasn’t referring just to the search engine but also to the way the company heavily invested in other ventures like self-driving cars and video-sharing platforms among others.

However, I also figured that Baidu innovated in search as much as Google has done.

Facebook Business Model

Mark Zuckerberg has passed from the motto of “Move fast and break things” to “Move fast with stable infrastructure. The young Zuckerberg was growing a company out of his dormitory prioritized scale over everything else.

It didn’t matter how much it messed things up as soon as it managed to survive and grow at super fast speed. Over the years through Facebook has also become a more mature company, which affected billion of people around the globe.

Thus, Mark Zuckerberg realized he needed to change his motto to one that made it possible to move fast but also repair along the way the damages created by a relentless focus on growth.

Today Facebook is among the most profitable businesses in the world, with even higher profitability than Google. The duo GoogleFacebook is the oligopoly of the digital advertising world. A third entrant might come soon, Amazon.

Venmo Business Model

Hey, can you venmo me some money? Does it sound familiar? Venmo has become one of the fastest growing companies, acquired by PayPal; it is now revolutionizing payments by adding a component of virality and network effects!

Twitter Business Model

Twitter is one of those companies that everyone expects to fail anytime soon, yet it has proved, also thanks to its business model to get back on track each time.

I personally like Twitter as a communication tool, way more than I do of Facebook. Yet beside personal likes or dislikes, Twitter has an interesting business model worth exploring!

IKEA Business Model

A few people are aware of the IKEA organizational structure. I suggest you look at it as it is one of the critical components of its success from the side of keeping a large and mature organization successful.

YouTube Business Model

From its first video to the San Diego Zoo, uploaded by its founder, YouTube has come a long way. Now one of the most popular sites on earth, YouTube is perfectly integrated into Google (now Alphabet) operations!

You might be surprised to find out a few critical elements of its business model and how YouTube is also experimenting with premium memberships programs.

What’s next for 2019?

A Ph.D. program lasts at least five years to a decade. So if we take that into account, I started my “real-life Ph.D.” only a year ago. So I’m still at the beginning of my trip.

The list I have down of companies I want to study, and the business models I want to understand is so long that I probably have enough to work for the next year at least.

Throughout this year I learned many things about business modeling. As any topic the more you learn, the wider your ignorance gets, and you figure you still miss a lot.

One objective for next year is to keep studying and documenting here what I learn. But also to start producing some original tools. For instance, lately, I created the Blizscaling business model innovation canvas that I think is a great toolbox to determine whether a company has the crucial element in place to scale up.

More of those tools will probably come out in the coming year. Another element is to have professionals I think can add a lot of value to this community to contribute with their experience as a practitioner.

And a third and critical aspect will be about partnering up with academics and practitioners from the business modeling world to bring you insights that you will hardly find anywhere else.

The three key ingredients that will make you love this portal are simplicity, effectiveness, and insights you’ll get from these resources to help you become a better business person!

The resources you need to get started with your business model: 

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Published by

Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which he brought to reach over half a million business students, professionals, and entrepreneurs in the last year | Gennaro is also Head of Business Development at a tech startup, he helped grow at double-digit rate and become profitable | Gennaro is an International MBA with emphasis on Corporate Finance | Subscribe to the FourWeekMBA Newsletter | Or Get in touch with Gennaro here

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