Business modeling - UC San Diego Office of Innovation and ... · BUSINESS MODELING BASED ON...
Transcript of Business modeling - UC San Diego Office of Innovation and ... · BUSINESS MODELING BASED ON...
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BUSINESS MODELING BASED ON BUSINESS MODEL GENERATION BY ALEX OSTERWALDER & YVES PIGNEUR
Greg Horowitt
T2 Venture Capital
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WHAT IS A BUSINESS MODEL?
A business model is a way of articulating the
flow and dependencies of how an organization
creates, delivers and harvests value
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WHY IS THIS IMPORTANT? To organize your thoughts, understand options, assert
hypotheses, and formulate ways to test them
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WHAT IS A BUSINESS CANVAS? A visual and flow form way of illustrating your business model
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Why business modeling vs.
business planning?
• Business plans are static documents and startups
are dynamic
• No business plan survives first contact with the
customer (variation on Sun Tzu’s ‘Art of War’)
• Companies without product and no sales must
develop hypotheses and a way to test them
• Your assumptions are more relevant to potential
investors than a spreadsheet with financial
models and a ‘hockey stick’ ramp
• Able to remodel as you ‘pivot’
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CUSTOMER SEGMENTS
which customers and users are you serving?
which jobs do they really want to get done?
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VALUE PROPOSITIONS
what are you offering them? what is that
getting done for them? do they care?
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CHANNELS
how does each customer segment want to be reached?
through which interaction points?
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CUSTOMER RELATIONSHIPS
what relationships are you establishing with each segment?
personal? automated? acquisitive? retentive?
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REVENUE STREAMS
what are customers really willing to pay for? how?
are you generating transactional or recurring revenues?
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KEY RESOURCES
which resources underpin your business model? which
assets are essential?
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12
KEY ACTIVITIES
which activities do you need to perform well in your
business model? what is crucial?
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KEY PARTNERS
which partners and suppliers leverage your model?
who do you need to rely on?
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COST STRUCTURE
what is the resulting cost structure?
which key elements drive your costs?
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15 images by JAM
customer
segments
key
partners
cost
structure
revenue
streams
channels
customer
relationships
key activities
key
resources
value
proposition
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9 Guesses
Guess Guess
Guess
Guess
Guess
Guess
Guess
Guess Guess
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PATTERNS • Unbundling
• The Long Tail
• Multi-Sided Platforms
• Free
• Open Business Models
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Unbundling the Corporation John Hagel and Mark Singer
• Three businesses in one
• Customer relationship management
• Product Innovation
• Infrastructure management
• Three economic imperatives
• Economic
• Competitive
• Cultural
• Examples
• Banking
• Telecommunicatioins
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The Long Tail
•Selling less of more
•Examples: Netflix, eBay, YouTube,
•Lego, M&M
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Multi-sided Platforms
• Brings together two or more separate, but connected
groups of customers
• Value is generated only if one group is present with
another group
• Example: eBay, Google, Apple iTunes and App Store,
• Network effect increases value
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Free
• One set of customers can always benefit from free of
charge offers
• Subsidized by another group
• Examples: Skype, Google, Pandora, Spotify, Facebook
• Upgrade to Freemium model (Skype, Mozy)
• Bait and Hook (most US cellular carriers, Gillette)
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Open Business Model
• Use external innovation sources to grow business
• Sell innovation to external partners
• Can be inside-out, or outside-in
• P&G
• GSK (patent pools for underserved diseases)
• Apple App Store
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DESIGN
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Ideation
• Brainwriting and Brainwalking, Silly Cow, Worst Idea
• Lateral Thinking (Atlasian’s FedEx day)
• Using the 9 building blocks of the Canvas
• What if?
• Prototyping
• Visual Thinking
• Post-it™ Notes
• Drawing
• Storyboarding
• Scenario planning
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STORYTELLING Give life to the intangible
Create clarity
Engage me
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STRATEGY
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PROCESS
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5 Phases of Business Model Process
•Mobilize
•Understand
•Design
•Implement
•Manage
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