What is a Business Model Anyway?

So what is a business model anyway? Fundamentally, it is how your business makes money. It is the core reason why people will part with their dollars to purchase your product or service. Here are some good articles that I think get at the essence of what a business model is and why it’s important. This is a good place to start.

Business models vs. Business plans – a good way of thinking about your start-up at it’s earliest stages

Business Models on the Web – via Managing the Digital Enterprise – a comprehensive and clear look at business models for web-based companies.

Five Reasons Companies Fail at Business Model Innovation – from HBS, a great look into why it’s so hard for the big guys to innovate on business model. It follows that this just creates more opportunities for start-ups who can innovate this way.

Habits Are the New Viral – I like this article because it makes the point that user behavior should be built into the product (and the business model) from day 1.

If you’re interested in stories about how individual companies pivoted (changed their business models as they grew), there are a number of them in the business model category on the blog.