Business Model:
"A design of the operations of a business which
focuses on how revenue will be generated" (Dictionary.com)
A business
model describes the rationale of how an
organization creates, delivers, and captures
value (Osterwalder & Pigneur, 2010)
A business
model is a description of the activities
that a company performs to generate revenue or
other benefits, and the relationships,
information, and product flows a company has
with its customers, suppliers, and complementors
(Malone et al., 2006)
[A] Lean Canvas (LC)
is adapted from Alex Osterwalder's
The Business Model Canvas. Lean Canvas helps
deconstruct a business model into nine distinct
subparts that are then systematically tested, in
order of highest to lowest risk. Lean Canvas is
a business model validation tool. that document
a business model, measure progres and
communicate learning with internal and external
stakeholders:
Problem: The first
stage is about determining whether a problem is
worth solving before investing months or years
of effort into building a solution.
Customer Segments:
Prioritize target customers and users that that
will need the product most.
Unique Value Proposition:
Single, clear, compelling message that states
why you are different and worth buying.
Solution: Once the
problem is understood, you are then in the best
position to define a possible solution -
identify the top 3 features.
Channels: Path to
customers and users. The means by which a
company delivers products and services to
customers. This includes the company's marketing
and distribution strategy.
Revenue Stream: Your
sources of revenue. Revenue Model, Lifetime
Value, Revenue, Gross Margin. The way a company
makes money through a variety of revenue flows.
Cost Structure: Your
fixed and variable costs. Customer Acquisition
Costs, Distributing Costs, Hosting, People, etc.
Key Metrics: Key
activities you measure. Every business has a few
key numbers that can be used to measure how well
it is performing. These numbers are key for both
measuring progress and identifying hot spots in
your customer lifecycle.
Unfair Advantage:
Can’t be easily copied or bought. Examples
include: Insider information, “expert”
endorsements, a dream team, personal authority,
large network effects, community, existing
customers, SEO ranking, patents, etc.
Figure 1. The Lean Canvas with an Example
from Ash Maurya
Figure 1 is an example from Ash
(2013). A template for the Lean Canvas is
provided herein (Yeap, 2016)-.
