Success consists of going from failure to failure without loss
of enthusiasm. Everyone knows what a startup is for – don’t
they? In this post we’re going to offer a new definition of why
startups exist: a startup is an organization formed to search
for a repeatable and scalable business model. A Business Model
Ok, but what is a business model? A business model describes how
your company creates, delivers and captures value. Or in
English: A business model describes how your company makes
money. (Or depending on your metrics for success, get users,
grow traffic, etc.) Think of a business model as a drawing that
shows all the flows between the different parts of your company.
A business model diagram also shows how the product gets
distributed to your customers and how money flows back into your
company. And it shows your company’s cost structures, how each
department interacts with the others and where your company fits
with other companies or partners to implement your business.
While this is a mouthful, it’s