In a blog post last October entitled “Entrepreneurship as a Science – The Business Model/Customer Development Stack” Steve Blank suggested
Alexander Osterwalder and Yves Pigneur defined a business model as how an organization creates, delivers, and captures value. More importantly they showed how any company’s business model could be defined in 9 boxes. It’s an amazing and powerful tool. It instantly creates a shared visual language while defining a business. Their book “Business Model Generation,” is the definitive text on the subject.
Currently there are a number of templates and tools that help teams build a business model canvas:
- Business Model Stack
- Osterwalder’s Business Model Generation offers two:
- Lean Canvas
- Lean Launch Lab
- The Startup Toolkit (also suggests three Customer Development Anti-Patterns) [See Oct-24-2011 Update below]
Osterwalder’s formulation reminds me of Newton’s dot notation for calculus (fluxions or derivatives). It points out the need for a formal notation but it’s too cumbersome and not usefully extensible. I don’t question the need for meaningful and portable representations of business models, and the canvas may be the best thing we have today, but I think it will represent an evolutionary dead end.
It seems like much of the push for it comes from folks who look at many business models (e.g Angels,incubators, and VCs) and want them to be easily comparable, not from entrepreneurs who want to be able to track what they need to validate next and the evolution of their thinking and hypothesis set over time.
For me the approaches suggested below seem more promising, at least through the Find Your Niche stage.
- Analysis of Competing Hypotheses
- The One Page Business Plan
- Brant Cooper and Patrick Vlaskovits “CustDev Whiteboard Model“
- Lunatech Ventures somewhat tongue in cheek Plancruncher
Our approach for bootstrapping entrepreneurs who target businesses includes:
- A 5 stage startup lifecycle model stages model that offers some simple guidelines for what to focus on next at each stage of development
- First Seven Questions Your Product Plan Should Answer
- A Startup Maturity Checklist
- Focus on the Right Layer of the Right Problem at the Right Time
Update Oct 24: Rob Fitz has blogged that he is “Phasing out Canvas and Dashboard Tools.“
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