Where everything converges. A founder must be strategist, marketer, operator, and financier at once — turning an idea into a repeatable, fundable machine. This is the MBA applied.
1The big idea
A business model is how you make money
A business model describes how an organisation creates, delivers, and captures value (sound familiar? — it's the same value logic from marketing, now at the whole-company level). Entrepreneurship is the search for a model that's repeatable and scalable.
Create valueSolve a real problem for a defined customer better than the alternatives.
Deliver valueReach & serve those customers through workable channels & operations.
Capture valueCharge in a way that earns more than it costs to deliver — profitably, at scale.
Memory hook 🧠A startup is "a temporary organization in search of a repeatable, scalable business model" (Steve Blank). The job isn't to execute a known plan — it's to find the plan that works.
2★ The one-page business
The Lean Canvas
A single page that captures an entire business model — replacing the 40-page business plan nobody reads. Nine blocks force you to think through every critical assumption. (Adapted by Ash Maurya from the Business Model Canvas, tuned for startups.)
1
Problem
Top 1-3 problems your customer has.
4
Solution
The minimum features that solve them.
3
Unique Value Prop
The single, clear, compelling message: why you're different & worth buying.
9
Unfair Advantage
What can't be easily copied or bought.
2
Customer Segments
Your target customers — and the early adopters within them.
8
Key Metrics
The few numbers that tell you it's working.
5
Channels
Paths to reach your customers.
7
Cost Structure
Your main fixed & variable costs.
6
Revenue Streams
How you make money — pricing & revenue model.
Memory hook 🧠Fill it in this order: Problem → Customer → UVP → Solution. Start with the problem & who has it, never the solution. Founders fall in love with solutions; markets only pay for solved problems.
3The two-step journey
Problem-Solution & Product-Market Fit
Startups succeed by hitting two milestones in order. Skipping straight to scaling before fit is the #1 cause of startup death.
Problem-solution fitHave you confirmed a real problem worth solving, and that your solution addresses it? (Talk to customers, not your own assumptions.)
Product-market fitHave you built something a market genuinely wants — shown by organic demand, retention & word of mouth? The real inflection point.
MVP — Minimum Viable ProductThe smallest thing you can build to start the learning loop — to test whether the problem & solution are real, with minimum waste. Not a crappy product; the fastest experiment.
Memory hook 🧠"Fall in love with the problem, not the solution." First prove the problem & fit; only then pour fuel on growth. Scaling a bad fit just burns money faster.
4The Lean Startup engine
Build → Measure → Learn
Since you don't know what works, you run experiments instead of betting big. Each loop turns assumptions into validated knowledge as fast and cheaply as possible.
Build the smallest test → measure real behaviour → learn → repeat. Minimise time around this loop.
Pivot or persevereAfter each loop you decide: persevere (the data validates the plan, keep going) or pivot (a structured change — new customer, new problem, new model — keeping what you learned). Famous pivots: Slack (from a game), Instagram (from a check-in app).
5Does each customer pay off?
Unit Economics
Before scaling, prove the model works for a single customer. If you lose money per customer, growth just multiplies the losses. This ties straight back to marketing's LTV:CAC (M9).
Each customer should return ≥3× what they cost to acquire, and repay that cost within a year.
Contribution marginRevenue per customer minus the variable cost to serve them. Must be positive — the foundation.
Burn rate & runwayBurn = monthly net cash outflow. Runway = cash ÷ burn = months until you're out of money. Watch it like oxygen.
The classic killer ⚠️Growing fast with broken unit economics ("we'll make it up in volume") is how funded startups implode. Profitable per unit first, then scale.
6How money comes in
Revenue Models
How you charge is itself a strategic choice — it shapes growth, predictability, and valuation. Common patterns:
SubscriptionRecurring fee (SaaS, memberships). Predictable revenue, high valuations — investors love it.
TransactionalPay per purchase. Simple but less predictable.
MarketplaceTake a cut of transactions between buyers & sellers. Network effects, but chicken-and-egg to start.
AdvertisingFree to users; monetise attention. Needs huge scale to work.
Memory hook 🧠Recurring revenue is king. A subscription customer is an annuity; a one-time sale is a coin flip you have to keep winning. That's why SaaS commands premium valuations.
7Fuelling growth
Funding Stages
Startups raise money in rounds as they hit milestones — trading equity for capital. Each stage carries different risk, expectations, and investor type.
BootstrapSelf-funded from savings/revenue. Full control, no dilution — but slow & capital-limited.
Pre-seed / SeedAngels, friends & family, early VCs. Fund finding product-market fit. Small cheques, big risk.
Series AVCs fund scaling a proven model. You need real traction & metrics to raise it.
Series B, C…Larger rounds to expand, enter markets, dominate. Growth over profit (usually).
ExitIPO (go public) or acquisition. How founders & investors realise their returns.
Dilution & the cap tableEach raise issues new shares, so founders own a smaller % (dilution) — but of a hopefully bigger pie. The cap table tracks who owns what. Raising more isn't always better: it costs ownership & control.
8Staying ahead
Moats & Scaling
Once a model works, two questions: can you defend it (moat) and can you grow it without costs growing just as fast (scale)?
Network effectsEach new user makes the product more valuable to others (marketplaces, social). The strongest moat.
Switching costsPainful for customers to leave (data, integrations, habit). Locks in revenue.
Economies of scaleUnit costs fall as volume rises → price advantage rivals can't match.
Memory hook 🧠This is the "Unfair Advantage" box on the Lean Canvas — and VRIO from your Strategy module (M1). A great business isn't just profitable; it's defensible.
9Doing it right
Business Ethics & Governance
A model can be profitable and still wrong. Ethics & governance are the guardrails that keep a business sustainable, legal, and trusted — not optional extras.
Stakeholders vs shareholdersShareholder view: maximise owner returns. Stakeholder view: balance customers, employees, society & environment too. The modern consensus leans stakeholder.
Corporate governanceThe system of rules & oversight (board of directors, audits) that holds management accountable to owners & the law.
ESGEnvironmental, Social, Governance — the framework investors increasingly use to judge non-financial risk & responsibility.
CSRCorporate Social Responsibility — a company's commitment to operate ethically & contribute to society beyond pure profit.
Tie it together 🧠The whole module is the MBA in miniature: Strategy (UVP, moat) + Marketing (segments, channels) + Operations (delivery, costs) + Finance (unit economics, funding) — all on one canvas, kept honest by ethics. Next: the capstone, where you run this on a real company.
🎯 Active recall
Cover the answer, say it aloud, then tap to check. The big ones: re-draw the Lean Canvas blocks and the Build-Measure-Learn loop from memory. Revisit today, +3 days, +1 week.
Define a business model and what a startup is "searching" for.
A business model is how an org creates, delivers, and captures value. A startup is a temporary organization searching for a repeatable, scalable business model (Steve Blank).
tap to reveal
★ Name the Lean Canvas blocks and the order to fill them.
Problem, Customer Segments, UVP, Solution, Channels, Revenue, Cost Structure, Key Metrics, Unfair Advantage. Start with Problem → Customer → UVP → Solution — never lead with the solution.
tap to reveal
Problem-solution fit vs product-market fit?
Problem-solution fit = confirmed a real problem your solution addresses. Product-market fit = built something a market genuinely wants (shown by retention, organic demand, word of mouth) — the key inflection point.
tap to reveal
What is an MVP, really?
The smallest thing you can build to start the Build-Measure-Learn loop and test your riskiest assumptions with minimum waste — the fastest experiment, not a low-quality product.
tap to reveal
Describe the Build-Measure-Learn loop and pivot vs persevere.
Build an MVP → measure real behaviour → learn → repeat, minimising loop time. Then either persevere (data validates the plan) or pivot (structured change keeping what you learned).
tap to reveal
Why must unit economics work before scaling?
If you lose money per customer, growth multiplies the losses. Need LTV:CAC ≥ ~3, CAC payback < 12 months, and positive contribution margin first — then scale.
tap to reveal
Define burn rate and runway.
Burn rate = monthly net cash outflow. Runway = cash ÷ burn = months until you run out of money. Watch it like oxygen.
tap to reveal
Why is recurring (subscription) revenue prized?
It's predictable — a subscriber is like an annuity, vs a one-time sale you must keep re-winning. Predictability earns premium valuations (e.g. SaaS).
tap to reveal
Name two types of moat.
Network effects, switching costs, economies of scale, brand/IP. (This is the Lean Canvas "Unfair Advantage" — and VRIO from Strategy.)
tap to reveal
Shareholder vs stakeholder view, and what ESG stands for.