Business Model Canvas

For a long time I have wondered why so many clients are reluctant to produce business plans. My conclusion came from my own reluctance to get through some admin paperwork, being that I couldn’t see the benefit to me in doing the admin and that it just didn’t excite me.

The same applied to clients producing business plans. The standard business plan models were not offering the perceived benefit to the business owner, producing a plan was deemed to be a chore rather than a benefit and something required by another person, not the business owner.

Pretty much every successful business has a plan in place, it just doesn’t always follow that the plan is a document built of pages, images and graphs. After all, most businesses are driven by KPIs rather than financials so a business plan should be the same.

I am an advocate that KPIs should drive the financial forecasts. The financials should be based on clear and defined KPIs.

The business model canvas is not a new concept but it remains something underused. It is also something based around the KPIs which makes it very different. There is nothing to say a business plan has to be traditional, your business is not the same so why is your business plan?

Equity Funding & Debt Finance

Believe it or not, many VCs and Equity Funders like the business model canvas. What it does is allow the business to show character and personality within their plan. It also allows a third party to quickly understand the key drivers of the business without having to wade through Porter Models, SWOT and pages of text.

Debt finance lenders who want business plans tend to be the mainstream banks. It remains the case that providing the business model canvas to there may freak them out, however if supplied with the financial forecasts then your proposal will stand out from the crowd. It will also cover the main areas your bank manager needs to give comment on to their credit team. The easier you make the lender’s life the easier yours becomes.

Standard & Lean

There are two attachments below for two variations of the canvas. Both these have come from Creatlr with further variations available to download on their site.

Business Model Canvas pdf

Lean Business Model Canvas pdf

If the business plan can be something that is mutually beneficial then it suddenly moves from being a necessary evil to a valuable tool for your company. When it comes to business plans, and excuse the reference to something an ex-girlfriend once said, but size really doesn’t matter. It is quality over quantity, besides business has changed so why hasn’t the way you make a business plan?

Give the canvas a go and let me know how it goes.

By Dave Farmer