What is a business model and how fulfill a business model canvas. Some example of wellknown companies business model: Coca Cola (glass bottle!), Financial Times, LinkedIn, Groupon, Twitter, Facebook, Blockbuster and Google. Finally community business model (geographically based, professional and online communities) and what is a business plan and how is diverse from a business model.

1. Business model
IED
Lesson 5
Frieda Brioschi
frieda.brioschi@gmail.com

2. Course program
1. Italian Startups
2. Set up a startup in Italy
3. I've got an idea. And now?
4. Value analysis
5. Business model
6. Communicate, communicate, communicate
7. Being net
8. Find your market
9. Funding: venture capital, business angel and other
ways of financing
10. Pitch

3. Today's table of content
1. Business Model
2. Examples
3. Business Plan

4. Value analysis: quick recap
During last lesson you learnt about direct and indirect
costs:
1. the former are costs that can be identified
specifically with a particular project or activity
labour agreements
2. the latters include all the other costs

5. Value analysis: quick recap
You went through the definitions of cash and accrual
basis accounting:
• difference between them has to do with the time
frame in which revenues and expenses are recorded
and reported

6. Value analysis: quick recap
Some examples of perceived value:
• Gillette Fusion Vs Gillette Custum Plus Disposable
• 3M Scotch Tape Vs 3M Scotch Command Strips
• A-Style, Lacoste, etc.
Value is the extent to which a good/service is
perceived by its customer to meet his needs/wants,
measured by the customer’s willingness to pay for it.

7. Business model

8. Business model /1
A business model describes the rationale of how an
organization creates, delivers, and captures value
(economic, social, cultural, or other forms of value).
The process of business model construction is part of
business strategy.
It's a way to represent core aspects of a business,
including purpose, offerings, strategies, infrastructure,
organizational structures, trading practices, and
operational processes and policies.
http://en.wikipedia.org/wiki/Business_model

9. Business model /2
The essence of a business model is that it defines the
manner by which the business enterprise delivers
value to customers, entices customers to pay for
value, and converts those payments to profit: it thus
reflects management’s hypothesis about what
customers want, how they want it, and how an
enterprise can organize to best meet those needs, get
paid for doing so, and make a profit.
http://en.wikipedia.org/wiki/Business_model

10. The business model canvas

11. 1 – Value proposition
The collection of products and services a business
offers to meet the needs of its customers. It's what
distinguishes itself from its competitors.
It provides value through various elements
• newness,
• performance,
• customization,
• "getting the job done",
• design,
• brand/status,
• price,
• cost /risk reduction, ecc.
http://en.wikipedia.org/wiki/Business_Model_Canvas

12. Value Proposition Builder
1.Market: for which market is the value proposition being
created?
2.Value/customer experience: what does the market value
most? The effectiveness of the value proposition depends
on gathering real customer, prospect or employee feedback.
3.Offering: which products or services are being offered?
4.Benefits: what are the benefits the market will derive from
the product or service?
5.Alternatives and differentiation: what alternative options
does the market have to the product or service?
6.Proof: what evidence is there to substantiate your value
proposition?
http://en.wikipedia.org/wiki/Value_proposition

13. 2 – Customer segments
A company must identify which customers it tries to
serve. Various set of customers can be segmented
based on the different needs and attributes to ensure
appropriate implementation of corporate strategy
meets the characteristics of selected group of clients.
The different types of customer segments include:
• Mass Market
• Niche Market
• Segmented
• Diversify (multiple customer segments with different
needs and characteristics)
http://en.wikipedia.org/wiki/Business_Model_Canvas

14. Do you know who your customers are?
http://www.designvision.com/strategy/

15. Really?
http://www.designvision.com/strategy/

16. 3 - Channels
A company can deliver its value proposition to its
targeted customers through different channels.
Effective channels will distribute a company’s value
proposition in ways that are fast, efficient and cost
effective.
http://en.wikipedia.org/wiki/Business_Model_Canvas

17. 4 – Customer relationship
To ensure the survival and success of any
businesses, companies must identify the type of
relationship they want to create with their customer
segments.
• Personal Assistance
• Dedicated Personal Assistance
• Self Service
• Automated Services
• Communities
• Co-creation
http://en.wikipedia.org/wiki/Business_Model_Canvas

18. Why does it matter?
http://soffrontblog.com/2011/02/07/benefits-of-an-on-demand-crm-application/

19. 5 – Revenue streams
The way a company makes income from each
customer segment.
• Asset Sale
• Usage Fee
• Subscription Fees
• Lending/Leasing/Renting
• Licensing
• Advertising
http://en.wikipedia.org/wiki/Business_Model_Canvas

20. http://www.flickr.com/photos/silkcharm/2893602428/

21. 6 – Key resources
Are the assets required to offer and deliver value
proposition to the customer.
• Physical
• Intellectual
• Human
• Financial
http://en.wikipedia.org/wiki/Key_resources_(business_model)

22. 7 – Key partner
In order to optimize operations and reduce risks of a
business model, organization usually cultivate buyer-
supplier relationships so they can focus on their core
activity.
Complementary business alliances also can be
considered through joint ventures, strategic alliances
between competitors or non-competitors.
http://en.wikipedia.org/wiki/Business_Model_Canvas

23. 8 – Key activities
The most important activities in executing a
company's value proposition.
http://en.wikipedia.org/wiki/Business_Model_Canvas

24. 9 – Cost structure
This describes the most important monetary
consequences while operating under different
business models.
• Fixed Costs
• Variable Costs
• Economies of Scale
• Economies of Scope
http://en.wikipedia.org/wiki/Business_Model_Canvas

25. Examples

26. Coca Cola
http://sopinion8ed.wordpress.com/2012/11/23/the-coca-cola-business-model-and-their-competitive-advantage/

27. Financial Times
http://glennas.wordpress.com/2010/07/31/business-model-innovation-alexander-osterwalder/

28. LinkedIn
http://bmimatters.com/

29. Groupon
http://www.adriaanrijkens.nl/2011/06/29/the-groupon-business-model-canvas/

30. Twitter
http://bmimatters.com/2012/02/18/understanding-twitter-business-model-design/

31. Facebook
http://bmimatters.com/2012/04/10/understanding-facebook-business-model/

32. Blockbuster
http://daphnecurry.wordpress.com/2011/08/25/business-model-for-blockbuster-video/

33. Google
http://bmimatters.com/2012/04/18/comparing-facebook-and-google-business-models/

34. Wikipedia
Does an original business plan still exist for
Wikipedia?
http://www.quora.com/Wikipedia/Does-an-original-business-plan-still-exist-for-Wikipedia

35. Community models

36. Geographically based
• neighbourhood
• productive district
• close to me
http://www.oilproject.org/lezione/cos-un-business-community-model-6346.html

37. Professional community
All the people making the same job.
It’s an easy target.
http://www.oilproject.org/lezione/cos-un-business-community-model-6346.html

38. Online community
• Easy to reach (massive tools available)
• There’s no clear limits between being part of a
community and a company business (let’s think of
UGC)
• Online users are available to pay for an interesting
service (freemium!)
• Can be created as part of my business (i.e.
Amazon’s libraries network)
http://www.oilproject.org/lezione/cos-un-business-community-model-6346.html

39. Business plan

40. Business plan
Business plan describes what, how long e how much
money you need to realize your business model.
Usually a business plan is a doc both for internal and
external use. Internally it describes the company
strategy, externally it presents the project to
stakeholder.

41. Business plan
Writing a business plan help to clarify every company
activities and
• optimize and develop available resources
• improve consciousness on financial aspects, cash
flows, break even, etc.
• Analyze risks
• Identify path to specific goals
• Etc.
http://www.nascelimpresa.it/doc/guida_BUSINESS_PLAN.pdf

42. Business model Vs Business plan
Plans are static
..models are dynamic!
- Steve Blank -
http://www.slideshare.net/sblank/bus-model-and-cust-dev-jan-2013

43. Never forget.. !!!
http://retrolife.typepad.com/the_overexamined_life/entrepreneurship/

44. Next week
Communicate, communicate, communicate.