1 What is a business model?
At its core the concept of a business model is actually fairly simple. As one thinker put it:
A business model is essentially a description of ‘how you planned to make money’ from the business.
The problem for many early-stage entrepreneurs is that with all the excitement of launching a new business and the challenge of finding customers and making things work, the nuts and bolts of making money (most especially a profit!) might slip from the agenda. Yet, as the Danish academics Christian Nielsen and Morten Lund have pointed out:
No management activity is more important than having clarity about how the organization creates, delivers, and captures value. It requires, among other things, knowing what customers want, how value can be best delivered, and how to enlist strategic partners to achieve maximum benefit.
Introduction