Business Model

One way or another, every for-profit company in this world is trying to make money. Whether this is its #1 objective or its #3 objective, it is most definitely high up there in the list of priorities. So, how does a particular company make money? To answer this question, one must analyze a company’s business model.

At its core, the Business Model section in the Endeavor profile helps Panelists understand how a particular candidate company makes money. To address this question correctly, two key aspects of a company’s model need to be considered: (a) how the company monetizes and (b) what the company’s cost structure looks like. Another way to think about this is: “how does money flow (in, and then out) through this company?” Continue reading below to learn how to accurately describe and analyze your candidate company’s business model 👇🏼

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Business Models Glossary
Business Model Examples </aside>

What is a Business Model❓

A brief summary of the theory behind what a business model is:

A business model is a company’s plan for making money. There are two key levers for any company’s business model - monetization and costs. When analyzing a company’s business model, one must look at how the company monetizes (where, how, and how much money is coming into the company from customers/users), and then at what the company’s cost structure looks like (how is the money that is coming in flowing through the company, where is it being spent).
A business model is a description of how a company makes money today, it is a snapshot in time. Within the description of the business model, one can describe and indicate trend lines, but the bulk of the description should be focused on the company’s current state of affairs.
Gross profit margin is the main metric to look at when evaluating whether a model is profitable or not. Operating expenses can be corrected, but COGS are inherent to the model - they can be adjusted but this metric speaks to the profitability of the model itself.

📖 Business Model Glossary

In the document attached below (and linked here), you can find a glossary of Endeavor’s most commonly analyzed business models:

https://docs.google.com/presentation/d/1_5uXvF7F3Oa3-dHh8I358TM3URKtq0_oyM-8-ZWV9DI/edit?usp=sharing

🖋️ Section Structure

Instructions on what should be included in the Business Model section of the Endeavor profile:

Caveat - this section is open-ended and unstructured on purpose. The depth of detail included in it will vary depending on maturity of company, as well as industry and model. The instructions below should serve as guidelines for what to include, but should be interpreted as flexible.

Must-haves (READ THROUGH THESE IN DETAIL) 👇🏼

Nice-to-haves 👇🏼

Examples ✨