What Is a Business Model?
A business model is a company’s foundational blueprint for how it creates, delivers, and captures value. It answers the fundamental question: How does this company make money?
A strong business model identifies the target audience, the product or service being offered, the costs involved, and the pricing strategy. It isn't just what you sell, but how you sell it.
Common Business Model Examples:
- Direct Sales: Selling a product directly to a consumer (e.g., a local bakery or an online clothing store).
- Subscription: Charging a recurring fee for continuous access to a product or service (e.g., Netflix, gym memberships).
- Freemium: Offering a basic service for free while charging for advanced features (e.g., Spotify, LinkedIn).
- Marketplace: Connecting buyers and sellers and taking a cut of the transaction (e.g., Uber, Airbnb).
