A Tale of Two Business Canvases
/Back in September, I wrote about the Business Model Canvas, a powerful tool for rapidly capturing your business model. However, I have found some of the categories in the business model canvas to feel a bit abstract. So, I have found myself gravitating instead to a variant of the Business Model Canvas created by Ash Maurya called the Lean Canvas. His goal when creating the Lean Canvas was "making it as actionable as possible while staying entrepreneur-focused." In doing so, Ash retained four of the original boxes, tweaked one box (Value Propositions) and replaced four of the boxes from the Business Model Canvas. See below for how the boxes compare between the two canvases.
On Both Canvases
Customer Segments
Who are you serving?
Channels
How do you communicate with and deliver your value to your customers?
Revenue Streams
Which customer segments pay you? How do they pay you?
Cost Structure
What are the main expenses involved in serving your customers?
Lean Canvas Only
Unique Value Propositions
A clear, compelling message that states why you are different and worth buying.
Unfair Advantage
What is it about you that can't be easily copied or bought by competitors?
Key Metrics
What key customer activities do you measure to check your progress?
Solution
What are your top 3 features for solving your customers' top 3 problems?
Problem
What are the top 3 customer problems that you are solving?
Business Model Canvas Only
Value Propositions
What customer needs are you satisfying?
Customer Relationships
How do you interact with your customers?
Key Resources
What things (physical, intellectual, etc.) do you rely on to serve your customers?
Key Activities
What do you need to do to serve your customers?
Key Partnerships
Who must you work closely with to serve your customers?
In the Lean Canvas, these 9 blocks are still arranged on a one page canvas like the Business Model Canvas. The numbers on the example below indicate the recommended order for filling out the canvas.
Which One Should You Use?
With two options for creating a one page business model, how do you decide with to use? The truth is, either should work, so use the one that resonates the most with you. That said, here are my thoughts on when you might choose to use one model over the other.
You might want to use the Business Model Canvas if...external partnerships are particularly important. For example:
You are starting a new effort within an existing business
You are starting a business within a regulated market
Your distribution to the end users of your product involves middlemen (e.g. retailers, distributors, etc.)
You might want to use the Lean Canvas if...you can rapidly test your business model and product. For example:
You are starting a brand new business and need to test your market
Your product is software as a service that can be quickly changed
