The Nine Critical Elements Of Every Business Model

These questions are designed to assist your team as they complete the nine sections of the Lean Canvas tool.

  1. Customer/User Segments
    • Who are you targeting? Are they current customers or early adopters?
    • What market segments do you serve, and in which geographies?
    • Who will be buying the product or service, upgrading to subscriptions, and paying for in-app purchases?
    • What do those early customer demographics look like? What do they care about?
  2. Customer/User Problems
    • What are the top three problems they face that you are solving?
    • What are several current-day solutions to each of their problems?
    • Are these problems nice-to-haves, or needs? Will they reach for their wallet to solve it? Or will they need a large community before engaging?
  3. Unique Value Proposition
    • Single, clear, compelling message that the uninitiated can use to understand your product.
    • This should be the first thing out of your mouth when someone asks, "Why X app?"
    • It should clearly differentiate you from your competitors, or at least summarize how you intend to compete in the market.
  4. Your Solution
    • How does your product solve each of your user's problems?
    • Is it a periodic solution, or are there opportunities for repeating engagement or revenues? How often will your users need it/want it?
    • Are there opportunities for your solution to solve more problems over time in this space?
  5. Channels
    • How are you reaching your users? This should be stronger than "social media" alone, but can be as simple as your 1st-degree network of beta testers to begin with.
    • Where do your future customers gather? What industries are they talking to, what news are they reading, what entertainment are they watching? Where do they live?
    • Are there partnerships with other companies that can be formed (exclusive or not) that can help gain traction and provide a mutually beneficial relationship?
  6. Revenue Streams
    • How do you plan to monetize?
    • Paid App? Expect fewer downloads in general, which can be a great thing for initial launches.
    • In-App Purchases? The best IAPs are digital content that can be added to or refreshed easily. Other examples are additional features or integrations, and even limiting advertising exposure.
    • Advertising? Prepare to spend a lot of time and funds achieving critical mass to gain real revenues from advertising, OR prepare to spend resources dedicated to closing larger, more custom advertising deals for your platform. You will need a LOT of users for this to be effective, though.
    • Subscriptions? Is your product ever useful every month? Are you able to provide consistent value each month for your user? Examples include Dropbox, Evernote, and many other Software as a Service companies. Subscriptions are often by far the best way to monetize, but need to be built into the business model from the beginning.
    • Is this a loss leader for your company? Are you developing this app to add efficiencies to your team internally? Or creating a valuable asset that can be used for future business efforts? Apps can be a great way to do marketing and reach new distribution channels via the Apple App Store and Google Play Store.
  7. Cost Structures
    • If you deploy to the cloud, these can be calculated. Monthly fees, services, etc need to be identified up front.
    • Every week of production should be factored into your costs. If you are using an agency or freelancer, the expense is an easy one to factor, but if you have your own team, consider their costs of development as well.
  8. Key Metrics
    • If you could see one number and understand the health of the app, what would it be? What other metrics support that number?
    • The perfect metrics are both easy to collect and easy to understand.
  9. Unfair Advantage
    • An unfair advantage cannot be easily bought or copied. Is your mobile app adding to your unfair advantages?
    • Good unfair advantages can be found through authoritative experts, rock star team members, and value that can be built over time.
    • Other unfair advantages will always be found among your current customers, if you have them. Every startup's core problem is the lack of initial customers and would kill for the information at your disposal. Get out of the building and talk to them!