2.5 – Business Model Canvas
Gone are the days of the 50-page static business plan. The Business Model Canvas is a dynamic single page document that distills the 9 pillars of any business. Learnings from the Design Thinking exercise (Stage 1) can be transferred to the Business Model Canvas to be validated and tested in this module.
By the end of this module, you will be able to:
- Explain the importance of having a clear Business Model Canvas
- Compare the various segments in a Business Model Canvas
- Create a Business Model Canvas for your business idea
Section A: Download the Business Model Canvas
Steve Blank is a co-founder of Strategyzer and is the creator of the Business Model Canvas. You can download a Business Model Canvas from the Strategyzer website to follow along as you work through this section.
Section B: Summary of the Business Model Canvas
Watch the following video which summarizes the elements of the BMC.
Business Model Canvas Explained from Strategyzer on Vimeo.
It’s easy to think about the Business Model Canvas split in half. The right side shows the elements that are customer facing. The left side shows the elements that are internal to the business.
| Business (Left Side) | Customer (Right Side) |
|
|
Important Tips
- The Business Model Canvas is a living document. As you go through the validation process with each of these elements you will update the information.
- It’s key that the Value Propositions are aligned with the Customer Segments, otherwise your customers don’t care about the value you are trying to create for them.
- It’s key that the Revenue Streams are aligned with the Value Propositions, otherwise customers won’t want to pay for the value you are trying to create for them.
- It’s key that the Cost Structure is aligned with the Revenue Streams, otherwise your business will not make optimal profit.
Boyd Reid, Sarah Butts, and Martin Magill share their thoughts on the Business Model Canvas and its value to entrepreneurs.
Plan
Complete a draft of the Business Canvas Model you downloaded at the beginning of this module.
Optional Reading
Ebinum, Mike. “How To: Business Model Canvas Explained.”
Strategyzer. “How Do I Use the Customer Relationships Building Block of the Business Model Canvas?”
Cowan, Alex. “The 20 Minute Business Plan: Business Model Canvas Made Easy.”