introduction to the business model canvas
TRANSCRIPT
Background: StartUp Sector
2013
•200 High Potential StartUps
•350 Entrepreneurs developed their Business Plans
2014
•Government is focusing on creating more jobs through entrepreneurship and start-ups
Aim
Aim:
•To introduce the Business Model Canvas Tool
Objectives:
1.Define a Business Model
2.Explore the 9 Building Blocks of the Business Model Canvas
Business Model Definition
A business model describes the rationale of how an organisation creates, delivers, and captures value
A tool for:
•Describing
•Analyzing
•Designing
Business Model
Source: Business Model Generation created by Alexander Osterwalderhttp://www.businessmodelgeneration.com/downloads/businessmodelgeneration_preview.pdf
Business Model Canvas
Business Model Canvas
Strategic business planning tool with 9 Building Blocks1. Customer Segments
2. Value Proposition
3. Channels
4. Customer Relationships
5. Revenue Streams
6. Key Resources
7. Key Activities
8. Key Partnerships
9. Cost Structure
1. Customer Segments
For whom are we creating value?
Who are our most important customers?
•Mass Market
•Niche Market
•Segmented
2. Value Proposition
Tries to solve customer problem & satisfy their needs with value propositions.
•What value do we deliver to the customer?
•Which one of our customer’s problems are we helping to solve?
•What bundles of products & services are we offering to each Customer Segment?
•Which customer needs are we satisfying?
3. Channels
Value propositions are delivered to customers through communication, distribution, and sales channels.
•How are we reaching them now?
•How are our Channels integrated?
•Which ones work best?
•Which ones are most cost-efficient?
•How are we integrating them with customer routines?
3. Channels Phases
Channel Phases1. Awareness: How to raise awareness about
our company’s products & services?
2. Evaluations: How to help customers evaluate our organisation's Value Proposition?
3. Purchase: How to allow customers to purchase specific products and services?
4. Delivery: How to deliver a Value Proposition to customers?
5. After sales: How to provide post-purchase customer support?
4. Customer Relationships
Customer relationships are established & maintained with each Customer Segment.
•What type of relationship does each of our Customer Segments expect us to establish & maintain with them?
•Which ones have we established?
•How are they integrated with the rest of our business model?
•How costly are they?
5. Revenue Streams
A result from value propositions successfully offered to customers.•For what value are our customers really willing to pay?
•For what do they currently pay?
•How are they currently paying?
•How would they prefer to pay?
•How much does each Revenue Stream contribute to overall revenues?
5. Revenue Streams
Types
•Subscription Fees
•Lending/Renting/Leasing
•Licensing
•Brokerage fees
•Advertising
6. Key Resources
These are the assets required to provide •Distribution Channels
•Customer Relationships
TypesPhysical
Intellectual (brand patents, copyrights, data)
Human
Financial
7. Key Activities
What Key Activities do our Value Propositions require?•Our Distribution Channels?
•Customer Relationships?
•Revenue Streams?
Categories•Production
•Problem Solving
•Platform/Network
Some activities are outsourced & some resources are acquired outside.
•Who are our Key Partners?
•Who are our Key Suppliers?
•Which Key Resources are we acquiring from partners?
•Which Key Activities do partners perform?
MotivationOptimisation & economy
Reduction of risk & uncertainty
Acquisition of particular resources & activities
8. Key Partnerships
9. Cost Structure
The business model elements result in the cost structure•What are the most important costs?
•Which Key Resources are most expensive?
•Which Key Activities are most expensive?
Is your business more?Cost Driven (leanest cost structure)Value Driven (focused on value creation)
Sample characteristicsFixed Costs (salaries, rents, utilities)Variable costs
What next?
• Test the guesses in the Building Model Canvas
• Get out of the building and talk to customers *
• Only when potential customers validate the idea, then build the product or service
• Saves time & money
• Or Pivot
*Source: The Four Steps of the Epiphany by Steve Blank http://web.stanford.edu/group/e145/cgi-bin/winter/drupal/upload/handouts/Four_Steps.pdf
Summary
Aim:
• To introduce the Business Model Canvas Tool
Objectives:
1. Define a Business Model
2. Explore the 9 Building Blocks of the Business Model Canvas
Additional Information
YouTubeBusiness Model Canvas Explainedhttps://www.youtube.com/watch?v=QoAOzMTLP5s
Business Model Canvas Tutorial Episodes 1 - 6https://www.youtube.com/watch?v=wwShFsSFb-Yhttps://www.youtube.com/watch?v=wlKP-BaC0jAhttps://www.youtube.com/watch?v=iA5MVUNkSkMhttps://www.youtube.com/watch?v=7O36YBn9x_4https://www.youtube.com/watch?v=-2gd_vhNYT4https://www.youtube.com/watch?v=SshglHDKQCc
Catherine Duggan: gmail: [email protected]
Linkedin: ie.linkedin.com/pub/catherine-kearns/40/b4a/126/