Concept: Business Model Canvas

Skill Goal: Be able to convey your business model on a single sheet of paper.

Unless you have tested the assumptions in your business model first, outside the building, your business plan is just creative writing.” – Steve Blank

  • A business model canvas describes a high level overview of how a business captures or creates value.
  • A business model is not static, it is a set of assumptions that is tested and retested
  • The Alexander Osterwalder Business Plan Canvas uses 9 components:
    • Value Proposition – The benefits a customer receives from the solution;
    • Customer Segments – The segment(s) of the market that has a demand for the solution;
    • Channels – The methods used to acquire customers and distribute the solution;
    • Customer Relationship – The ongoing interaction established with clients;
      • Ex: Personal assistance, Dedicated personal assistance, Self-Service, Automated services, Communities, Co-creation
    • Key Resources – Physical, financial, intellectual, or human resources needed to create the solution;
    • Key Activities – The key activities necessary to implement the business model;
      • E.g. Production, Problem Solving, Platform/network
    • Key Partners – The key partners and their motivations to participate in the business model;
    • Revenue Streams – The revenue streams generated by the business model (constituting the revenue model);
    • Cost Structure – The cost structure resulting from the business model.

Additional readings:

What is a business model?

No Plan Survives First Contact With Customers – Business Plans versus Business Models

What’s A Startup? First Principles.

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