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What is a Business Model?

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A business model is an overview of your business, on a single page. A business model is a game plan.

Much like you have seen in movies, where the coach has a blackboard, and with chalk, he explains to the team what the strategy is – who should do what, and what the end goal is.

Business models change quickly, and often!

The reason for this is competitors, as your competitors change, your model should adapt and change as well, you might even work on designing your own model that makes your competitors follow you after some time, as your agency will eventually end up being THAT good.

In business, at the start, your model might change every 3 months or so. As time goes by, and your agency starts to establish itself, your model will change less.

The one thing to remember is that your business should always be working on improving its business model, even if it’s every 6 months, to a year. Businesses and agencies who do not adapt, and improve their models, are eventually overtaken by their competitors and will find themselves out of business.

So, in this section, we will be looking at the different business models that are needed for you to start or grow your agency.

You need to first ask yourself what stage your business is in, and what model will work best for you.

Here are the different business models, and the models that your business will progress through:

  • Bootstrapping Model
  • Start-up Model
  • Growth Model

 

Each business model consists out of 9 building blocks, each of these blocks, along with their sub-divisions, plays a major role in your business. Below you will find each of the 9 building blocks of a business model:

Key Partners

These are key partnerships that your business leverages, or relies upon, for success. These include the resources or value, that your business gets from them.

Key Activities

The key activities allow your business to provide your products or services and deliver on your value proposition.

Key Resources

These are the key resources your business relies upon, or uses, in order to operate and provide your products or services.

Value Propositions

This is the different value propositions that set your business apart from your competition.

Customer Relationships

These are the primary relationships you have with your clients, including how and when you interact with them, how these interactions differ among different types of clients, what different clients needs are, as well as the level of support that the different clients will receive.

Channels

These are how your clients are reached, how your services are provided, your different distribution channels, and how your value proposition is delivered.

Customer Segments

These are the ideal client personas that your value proposition is aimed at, as well as the key differences between these segments.

Cost Structure

The primary costs associated with starting your business, operating, and providing the products or services of your business, as well as the relationship between these costs and your other business functions.

Revenue Streams

This is how and where your business generates revenue from the delivery of your value proposition.

Now that you have the basics of the 9 building blocks of the business model, let’s have a look at the first model that is needed when starting your agency, as well as how to use the 9 blocks.

Remember to download your business model worksheet, and save it under the correct folder.

Key Activities

The key activities allow your business to provide your products or services and deliver on your value proposition.

Key Resources

These are the key resources your business relies upon, or uses, in order to operate and provide your products or services.

Value Propositions

This is the different value propositions that set your business apart from your competition.

Customer Relationships

These are the primary relationships you have with your clients, including how and when you interact with them, how these interactions differ among different types of clients, what different clients needs are, as well as the level of support that the different clients will receive.

Channels

These are how your clients are reached, how your services are provided, your different distribution channels, and how your value proposition is delivered.

Customer Segments

These are the ideal client personas that your value proposition is aimed at, as well as the key differences between these segments.

Cost Structure

The primary costs associated with starting your business, operating, and providing the products or services of your business, as well as the relationship between these costs and your other business functions.

Revenue Streams

This is how and where your business generates revenue from the delivery of your value proposition.

Now that you have the basics of the 9 building blocks of the business model, let’s have a look at the first model that is needed when starting your agency, as well as how to use the 9 blocks.

Remember to download your business model worksheet, and save it under the correct folder.