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What is business model and what are the types of business model?

Ben asked on Sep 11, 2018 - 3 answers
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updated his answer on Sep 13, 2018
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Hi Ben,

An excellent overview of what a business model is, what different business models look like and how you build one is the book "Business Model Generation" by Alexander Osterwalder.

That being said, permit me some very blunt advice (I am German, after all):

If you were on my team, I'd probably rip your head off for such a question. Maybe not the first time around, but definitely the second. Because it is just lazy and inconsiderate of other people's time to ask a question that Google can answer in a split second.


Whenever you come to someone - especially more senior people - with a question, make sure that you have done your homework and that asking this person is really the best and maybe the only way to find out the answer.


Benjamin replied on Sep 12, 2018
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Hi Ben,

Business model refers to the economic structure of your company :

- how do you generate revenue : selling goods / selling services / subventions

- what are the cost associated

Let's take an example for a SaaS startup such as Sales Force :

- revenue is generated by one off when seting up the systeme for a new client + subscription fee based on number of users and functionnalities unlocked

- cost structure is of course the sales guys visiting the client + all the cost associated to developping and maintainng the solution

Hope this helps

Feel free to ask more details if needed.

replied on Sep 11, 2018
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In the broad sense the business model is how you actually make the money. There are tens if not hundreds of business models. (e.g. subscription, marketplace, b2b sales and even more granular depending on the industry)


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