From Idea to business planning

Question 1

What is the Business Model Canvas?

Answer 1

The business model canvas is used by startup technology entrepreneurs in an iterative way. It is usually managed in real time by flagging segments with notes using Post-it Notes. The top flags represent the latest thinking on how to address that segment of the business model. Tech related business model should be scalable and repeatable. Craftspeople may desire creating ventures that feature one-off products that are not repeated or intended for mass markets. Technology entrepreneurs generally set out to solve massive human problems and serve massive markets.

Question 2

What are the 9 building blocks?

Answer 2

1.Customer Segments ( mass market, market niche, segmentation, diversification)

2.Channels - Effective channels distribute key values in a fast, efficient and effective manner.
Organizations can use their own channels (retail) or partner (distribution) channels, or a
combination.

3.Customer Relationships - Personal assistance, Self service, Automation, Communities, Co-creation

4.Value Proposition - A set of products and services that you offer to your customers, which solve
their problem of satisfy a need. What sets us apart from the competition: something new,
performance, adaptability, design, brand / status, price, availability, ease of use. Qualitative
(experience and performance) and quantitative (price and efficiency).

5.Key Activities

6.Key Resources - Human, Financial, Physical, Intellectual

7.Key Partners - Optimizing operations, Reducing the risk, Focusing on core business,
Alliances(joint ventures, with no / competitors)

8.Revenue Streams - Asset sale, Usage fee, Subscription, Rental, License, Brokerage and
advertising

9.Cost Structure - Fixed costs, Variable costs, Economies of scale, +horizontal and vertical
integration

Question 3

What are the blocks on Revenue Streams side?

Answer 3

Business model that tech entrepreneurs use to monetize their products or service(revenue
streams):
1. Pay as you go: products and services are offered at a price and customers purchase them as
they use them.

2. Freemium: providing a base set of products and services for free and an enhanced set at a reasonable price (Dropbox)

3.Billable hours: consultant bills the client on an hourly basis for service rendered, often with a
minimum fee.

4.Advertising based: aggregate users and sell advertising based on the number of daily and monthly visitors(Facebook)

5.Subscription pricing: payment of a fee to gain access to products and services for a fixed period of time(The Wall Street Journal)

6. Distributor or reseller: a distributor aggregates products from companies that make products, selling these to end users.
7. Retailer/Wholesaler: entrepreneur aggregate and hold products for end users and make
   them available as needed (Amazon)
8. Landlord-Leaser-Licensor: holding office space or intellectual property and permitting others to use the assets for free(Cloud)
9. Broker: facilitates the transaction between buyer and seller and generally charges a percentage of the transaction (eBay)

Question 4

What are the blocks on Cost structure side?

Answer 4

1.Fixed costs
2. Variable costs
3.Economies of scale
4.+horizontal and vertical integration