CB Insights calculat that 19% of startups close due to errors in the business model. But it is not only startups that ne to build a business model correctly. This tool helps all companies: both new and already developing. We tell you how to build a business model. We share templates and examples.
What is a business model
A business model is a document that describes a plan for building a business. Let’s say you want to sell children’s toys on the embankment. You have an idea, but to launch a business and phone number list ensure its development, this is not enough. You ne to describe how you plan to implement this idea: from whom you will buy toys, who will buy them, will there be advertising and what kind, etc.
That is, a business model is a schematic description of business processes that helps to understand how the company will operate and whether it has a chance of becoming profitable.
The difference between a business model and a business plan
A business model is a tool that helps define the development strategy of a business or startup in general terms. Such a schematic description of business processes allows you to assess the strengths and weaknesses of the project, and understand how the business will earn money. A business model does not include detail calculations of revenue or expenses. A business plan is a detail description of the business and 10 powerful examples in action to sell more calculation of costs, investments, and project performance indicators.
5. Advertising model
Businesses make money by placing ads on their platforms: websites, apps, or social mia.
Example. The company launch a website where it broadcasts news from the world of fashion and show business. The content is free for users, but there is advertising. It is from this advertising that the project team earns money.
For example, the YouTube channel works on the same model. The blogger zn business directory shoots videos, makes advertising integrations, and gets money for them.
6. Payment systems
Under this business model, the company provides payment services for a fee: payment processing, electronic money transfers and other financial services.
Example. Solar Staff is a service for transactions between entrepreneurs and performers: freelancers, outside teams. It works like this: the company transfers money for the complet project to the service, the money appears in the performer’s account.
