Dave Kashen of Quantum Leading calls for a change in startup culture:
"In the startup world, thousands of entrepreneurs focus their ingenuity on finding ways to make millions of dollars.
They look for market inefficiencies and focus on questions like: “Will consumers pay for this?” without asking “Will this make people’s lives meaningfully better?”
It’s not that we shouldn’t try to make money, it’s just that money should be merely one of many factors we strive for, and it’s played far too central a role for far too long.
So, if maximizing economic output fails to achieve the goal of maximized well-being, what might be an alternative hypothesis worth testing?"
The main idea with this post is to illustrate how the concept of hierarchical levels can be used for all parts of a business model with a concept the author, Anders Sundelin, calls the Value Proposition Explorer.
"To give an example, say that you have developed software that can efficiently manage energy in electrical vehicles.
Should you then try to sell the software? Combine it with hardware to provide energy management solutions? Or provide components of the software, such as the core algorithms for energy management, in a more narrow value proposition?
To choose which hierarchical level to position your value propositions is of course a function of many variables, in the end where you can create and capture the most value, and maintain a competitive advantage for the future.
This is not just a question of value propositions, but a question involving all components of the business model."
This animated two-minute videoclip offers a great introduction to the nine key elements that make up the Business Model Canvas.
The Business Model Canvas can be used by new entrepreneurs as well as by experienced one as a simple reference model bringing together all of they aspects of a typical commercial business.
"Imagine what would happen if Coca Cola shared its secret formula, or a popular restaurant shared its secret sauce recipe.
When source codes of software are shared beyond the secret society of their proprietors, a whole new world with unimaginable technical possibilities is opened.
Contrary to popular belief that the proprietors of the secret sauce would lose their pie, they actually get a slice of a much, much larger pie, which makes better business sense.
After all, many of today's tech rock stars like Google and Facebook follow the open source paradigm.
These firms had implemented their ideas using open source technologies when they had started.
And today, they allow free distribution of software developed by them for their internal use. Such open-sourcing enables newer startups to take advantage, yet again."
Louis CK, who recently announced on Conan O'Brien's show a bold new business plan for the comedy world.
Instead of striking the traditional deal with HBO, Comedy Central, Showtime, or other TV networks to broadcast his sold-out set, he’ll be streaming it himself, making an exclusive, edited version available online scheduled for Dec. 10th, a month after his Nov. 10th performance.
A punk-rock move to be sure--one that's reminiscent of Radiohead's DIY experimentation, but with a very Fugazi-like price tag of $5 a stream.
"At the heart of every business beat two essential elements: an idea and a plan.
An idea without a plan is just a dream. A plan without an idea is just a list. For a business to grow and thrive, it must have both.
Sometimes the idea comes first: “How about we make a computer screen you can touch?” Add a plan (design + manufacturing + marketing) and you’ve got the iPad. Sometimes the plan comes first: “What would happen if we sold something other than books the way Amazon sells books?” Add an idea (online shoes!) and you’ve got Zappos.
...
...once we’ve developed and tested business model, there’s still one more critical step towards making a living business: we need to sell it to partners, investors, and customers.
And that’s the second reason I love the “Business Model Canvas”: it provides us with the basis of the Vivid Story we’ll need to crystallize and communicate our idea.
When I say “Vivid” I mean something very specific: a Visual-Verbal-Interdependent idea; an idea made absolutely clear because it is expressed with both words and pictures."
"Consumers won’t pay for recorded music in the future — but fans will pay for music experiences.
When the dust finally settles between the artists, labels, and distribution companies, everyone will finally realize fans are more valuable than recorded music.
As traditional monetization models for recorded music sales slowly fade away, new monetization methods centered on the fan will emerge.
"Some people stumbled upon great ways to make money. During 2010 many promising concepts reached a tipping point. Let’s take a closer look at their business models."
A bit old, but still full of useful examples, information ideas and packaged in an effective presentation format.
Semil Shah on Techcrunch analyzes how even light curation and social sharing tools serve increasingly individuals in "discovering" sources, ideas, people and products they do not know yet.
"I’ve been tracking Pinterest for a while now and, to me, the single most important aspect of the site is that it has deeply tapped into an important shift in consumer and purchasing behavior.
As we make a decision to search for or buy something online, we are trained to go to Google (or Amazon), search by keyword, and sort through results to eventually make a transaction. In return for that sorting, Google charges for advertising, but in order for it to work, we users have to signal our intent: “Red Nike running sneakers.”
But, how did I decide to want these red running shoes in the first place? While Google makes money at the bottom of this decision funnel, the top of the funnel is where “discovery” happens. It’s much wider at the top of the funnel, and harder to pin down where the thoughts originate (pun intended).
A site like Pinterest could help bring some of that discovery online.
For the red running sneakers, instead of researching them myself, I may instead elect to browse the pinboards of Pinterest users who are dedicated runners. I could find sneakers on a friend’s board and may have reasonable confidence that this pair could suit me, too. In this manner, I may elect to buy the shoes right after seeing my friend’s board on Pinterest and get to a transaction faster."
Hard to say. Maybe never. It depends also on how search engines will evolve and how much of a role me and you will want to play in the post-Google era. ;-)
This is absolutely true for me. I feel somewhat overwhelmed managing information for my personal blog (www.pghlesbian.com) as well as our project blog, both of which requite me to sort a significant amount of information. I find myself coming here and to other curators (as I find them - any leads on good LGBTS curators?) and feeling like my head is a little above water. Thanks!
Robin Good: A professional analysis of the most prominent web business models as originally prepared by Prof. Michael Rappa director of the Institute for Advanced Analytics.
In his analysis, a classic reference for online entrepreneurs, you can find all of the basic information about the most popular and well known online business models.
Recommended. 9/10
"Business models have been defined and categorized in many different ways.
This is one attempt to present a comprehensive and cogent taxonomy of business models observable on the web. The proposed taxonomy is not meant to be exhaustive or definitive. Internet business models continue to evolve.
New and interesting variations can be expected in the future.
The basic categories of business models discussed in the table below include:
From the article intro: "While great examples of well-read traditional blog publications will probably be with us for some time, the real growth in the future of blogging will come as content producers turn the content production and consumption behavior that blogs accelerated into the ultimate tool for sales conversion.
So, you no longer need to think in terms of a blog as some extension of your website, but more in terms of blogging behavior and technology as the fundamental component of your content strategy.
Websites owners are using blog software to turn their sites into highly engaging content management systems and that evolution will continue to pick up steam for every type of business in the near future."
I agree: blogs as such are not the best channel anymore to deliver your best value proposition to your potential fans. You need something more focused and with greater content value.
"Rock the Post is a free business social networking site that serves as a bridge between entrepreneurs, professionals and investors to help take projects to the next level.
The site targets entrepreneurs, professionals and artists with a range of expertise as well as investors who are looking to support a cause or invest in business opportunities.
Regardless of what stage a project is in, Rock the Post brings the community together to pledge money, time and/or resources to help turn great ideas into extraordinary projects.
For example, a fashion designer may not have the funds to accomplish her lifelong dream of building her own clothing line.
By logging onto Rock the Post, she can create a post describing her situation and her fundraising goals. If users on Rock the Post are interested in her clothing line, they can pledge money, time and resources to help her raise the necessary funds to create her clothing line.
Users can choose to keep their posts on the site for 30, 60 or 90 days. If they don’t reach their desired goal within the specific time frame, they can extend the amount of days their post in on the site."
A. Almost anyone can now publish almost anything. You can publish a book without a publisher, record a song without a label, host a seminar without a seminar company, sell your art without a gallery. This leads to an explosion of choice. (Or from the point of view of the media producer, an explosion of clutter and competition).
B. Because of A, attention is worth more than ever before. The single gating factor for almost all success in media is, "do people know enough about it to choose to buy something?"
C. The marginal cost of one more copy in the digital world is precisely zero. One more viewer on YouTube, one more listener to your MP3, one more blog reader--they cost the producer nothing to produce or deliver.
As a result of these three factors, there's a huge sucking sound, and that's the erosion of mass as part of the media model.
Fewer people buying movie tickets and hardcover books, more people engaging in free media.
...
Media projects of the future will be cheaper to build, faster to market, less staffed with expensive marketers and more focused on creating free media that earns enough attention to pay for itself with limited patronage."
"...when the ecosystem stops rewarding complexity, it is the people who figure out how to work simply in the present, rather than the people who mastered the complexities of the past, who get to say what happens in the future."
Bemco is a very easy-to-use web-based tool to draft your own business model canvas. You get a basic interactive form in which you can insert your basic reference ideas, data and concepts that make up your business plan canvas.
If you want some great advice on how to monetize your online blog, you may want to look into building an online learning product / service of some kind.
Peep Laja of Traindom, lays down the basics to do just that.
Yes, and this indeed may be the way of the future as Seth Godin's own Domino Project gradually paves the way for it.
Books and ebooks can be utilized as great conversation sparks and business conversation starters, and this is exactly how the Domino Project is trying to leverage them.
The idea is simple: people do not trust brands that much, but they do trust individual authors and voices. Why not to use a book publication to spark conversations between a brand and its audience?
The brand can buy/distribute the book and get attention and prestige for being the one to bring new original value to its audience, and the book/author combination can attract the type of interest and desire to discuss that brands are seeking so badly in these times.
"This is part four of a five part series on transmedia business models by Brian Clark: Founder/CEO, GMD Studios.
... This time, we're going to look at models that rely (almost) intrinsically on raising capital.
These models all share at least two common features, and the key one is that the source of funding is some kind of venture capital (which means the return that investors expect is their money back and hopefully some profit for taking the risk.)
The change that comes with that is the mechanism of promotion. If you've only got a little bit of capital, you'll be relying upon media you create (owned) and earn (press and social sharing), but if you've got more capital you might start buying advertising from other places."
Dave Teten: "Any technology can find me a wife is a killer app."
Mr Teten just gave a talk as part of TEDx Silicon Valley on "Online Dating is the Future of Your Business".
In this talk David Teten discusses how some of the successful online dating startups are models for new businesses, many of which in various ways help businesses get more and better clients.
Specifically, he discusses the business success formula used by some of the interesting companies in the dating space -- True, BeautifulPeople, 420Singles, HowAboutWe (portfolio company), STDSter (a dating site for people with sexually-transmitted diseases), ignighter, InterracialSingles, AshleyMadison (a site for finding a mistress), Identified.com, Voxy, 500px, LocalResponse, Hashable, ThinkNear, and InfoChimps.
Stipple is a new service that allows image makes, photographers and other publishers to distribute and monetize their images online.
The monetization model of Stipple works around creating invisible tag for images published that allows them to showcase promotions for products or relevant services when the viewer hovers his mouse on specific parts of them.
Bill Mitchell reports for Poynter on the issue of raising paywalls for online media companies. From what he says it looks like the future is not so bleak after all.
Several companies have already made the move and the fear of losing a big portion of their audience has been superseeded by the discovery of new revenue channel.
Key highlights include:
"The evidence indicates that some portion of online audiences — the percentages vary widely — are willing to pay for online content. Some money is on the table, in other words, and news organizations should have pretty good reasons if they’re just going to leave it there.
As news organizations continue in their unpredictable transition from analog to digital delivery, they need to establish a paying relationship with their digital customers – and not just their advertisers — sooner rather than later.
Putting a price on their digital wares is encouraging newsrooms to step up the quality — in economic terms, the new value — of the online experience they expect people to pay for.
As social media plays a larger role in the distribution of and traffic to digital news, media companies need to develop strategies that generate revenue without impeding the social networking of their content."
Lots of valuable information in this article and numerous references to actual stories and cases.
The New York Times recently posted an article about “how to cash in” on your viral YouTube video.
The centerpiece video of the article is one that became a huge hit this month called “Lily’s Disneyland Surprise!” which currently sits at over 5 million views and represents the exact ingredients of viral YouTube sensations: it depicts a girl reacting cutely to an early birthday surprise, but she (and the rest of us) don’t know that the book-bag full of goodies is only the start, and the reaction that follows is what makes YouTube the go-to site for emotional response.
...
YouTube partners are, by contract, forbidden from sharing how much they earn from their video. But, maybe The New York Times found people who were willing to do so anyway, or that ban is not in effect for these people, or YouTube makes so much money from these videos that they don’t want to lose the business, or some other reason.
The “David After Dentist” video has apparently made a little over $100,000 from YouTube ads.
“David After Dentist” has a little over 100 million views.
That means, per 1000 views, the video has made a dollar. That’s a fraction of a penny per view, for partners.
Remember, these people become partners when YouTube discovers that a video is going viral and they ask the creators if they want to share the revenue.
The easiest way to see how much a viral video has earned, using this formula, is to simply remove the last three numbers from the total amount of views. So, 100 million becomes 100,000.
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