Business Model Canvas

A strategic management tool that provides a visual framework for developing, describing, and analysing a business

What is a Business Model Canvas?

The Business Model Canvas (BMC) is a strategic management tool that provides a visual framework for developing, describing, and analysing a business model. It was created by Alexander Osterwalder in 2008 and has since become a widely adopted approach for entrepreneurs, business owners, and corporations to map out their value propositions, customer segments, and key operations. The BMC breaks down the complex process of business planning into nine fundamental building blocks, providing a holistic view of how a company functions and delivers value to its customers.

These nine building blocks are:

Customer Segments: Who are the target customers?
Value Propositions: What value does the company offer?
Channels: How do you communicate and deliver value to customers?
Customer Relationships: What types of relationships are built with customers?
Revenue Streams: How does the business earn money?
Key Resources: What assets are necessary for the business?
Key Activities: What key activities are essential for delivering value?
Key Partnerships: Who are the business's important partners and suppliers?
Cost Structure: What are the major costs involved in running the business?

The BMC offers a simple, yet effective way for startups to design and communicate their business models. It is typically displayed on a large canvas or whiteboard, allowing teams to visualise, iterate, and adjust their strategies in real time.

Why use a BMC?

The Business Model Canvas serves as a visual communication tool that helps startups and established businesses alike clarify their strategies and business concepts in a concise manner. It forces entrepreneurs to think about the key elements of their business and how they interconnect, offering a structured way to test assumptions and spot potential weaknesses early on. The simplicity and clarity it offers are especially valuable during the early stages of a startup when pivoting and iterating are common.

Remember: The BMC breaks down the complex process of business planning into nine fundamental building blocks.

Moreover, the BMC helps foster alignment among team members, investors, and stakeholders by providing a shared understanding of the business strategy. It can also be used as a tool for strategic decision-making, helping businesses identify new opportunities or areas for improvement. By organising the business model in a visual format, it allows teams to quickly spot areas that need more focus or development.

When to use a BMC?

Startups and entrepreneurs can benefit from using the Business Model Canvas at any stage of their business development, but it is particularly valuable during the ideation phase and when launching a new product or service. It is an ideal tool for quickly capturing and experimenting with new ideas, testing different business models, and iterating on the approach based on customer feedback. By focusing on the essentials of the business model, the BMC allows for flexibility and agility in responding to market changes.

Remember: As a startup, you need a BMC before a business plan

Another important time to use a BMC is when seeking investment or presenting the business to potential partners. Investors are often looking for clear, concise business models that show a deep understanding of the target market, value proposition, and revenue generation strategies. Having a well-articulated BMC can make a significant difference in conveying the potential for success and scalability of the startup.

Pros and Cons of a BMC

Clarity: The BMC provides a simple and clear visual representation of a business model, making it easier to understand and communicate.

Flexibility: It allows entrepreneurs to experiment with different strategies and revise their business model as needed.

Collaboration: The visual format encourages teamwork and fosters collaborative problem-solving.

Efficiency: The BMC helps entrepreneurs quickly test and validate assumptions without the need for long, complicated business plans.

Simplification: While useful, the BMC may oversimplify complex business models, missing important nuances.

Limited Detail: It lacks the depth of traditional business plans, which might be necessary for more mature businesses or those requiring detailed financial projections.

Requires Updates: As businesses evolve, the BMC needs to be regularly updated to reflect changes in the business model.

BMC on My Startup Studio

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Always start with a BMC to quickly understand the big picture. You can always work on a business plan afterwards, when needed

Yes, our BMC tool can be generated automatically. The system leverages all available information about your business and idea to generate the result.

Yes, each BMC is autosaved and stored under your the history of the tool. You can easily compare, or leverage past versions.

It depends on when and how you trigger it. If you expand on your business details between each generation, then it will be different. If you adjust the target audience and other input parameters, then it will be different. If you don't change anything, then it will be comparable

SWOT Analysis

A strategic planning framework used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a business venture or project.