January 24, 2024

Business Model Innovation Framework — A Surefire System for Growth

What is a Business Model?

A Business Model maps the end-to-end operating system of a business — the specific problem you solve for a specific group of people, how you find those people & solve that problem, and how you profit from your efforts. 

In other words, your Business Model defines:

  • Who you serve (your Ideal Customer Profile or ICP)
  • What problem you solve (your Market Position)
  • How you attract & acquire customers (your Marketing & Sales system)
  • How you solve their problem (your Value Proposition)
  • How you generate profits along the way (your Monetization Strategy)

The only way to grow a business.

Increase sales.

Expand to new markets.

Build something that can scale AND last a long time.

Is through some form of business model innovation.

But most entrepreneurs won’t call it what it actually is. Because as human beings, we tend to have preferences.

And that’s where most Entrepreneurs go wrong.

Where most Entrepreneurs go wrong

Most entrepreneurs tend to “stay in their lane”

They may not admit it openly. They may not even realize what they are doing. But most will stick with where they are comfortable, where they are most skilled, where they think they are most likely to drive growth in their business.

What does this look like?

For me, it looked like a relentless focus on my Marketing & Sales system and my Monetization Strategy.

I would spend all my time thinking about and working on new marketing campaigns, finding new customers, and coming up with new offers to test & grow my business.

If I wasn’t seeing the kind of growth I wanted, I would return back to those two parts of my business model, assuming “that’s just how you grow a business.”

But I was ignoring the rest of my model.

Why Business Model Innovation is the Entrepreneur’s top priority

It wasn’t until I joined my good friend and CEO of Strikepoint Media, Jeremy Blossom, that I widened my horizons and started to consider how all 5 areas of a business model could be optimized for sustainable growth.

I started to understand how each piece of the Business Model was connected to every other piece:

  • How our Value Prop was tied directly to our Monetization Strategy
  • How our Market Position alone wasn’t strong enough on its own, but when coupled with our Value Prop made all the difference in the world
  • How a slight shift in our ICP increased our average deal size by more than 20x with the same level of effort

In the 6 years I spent at Strikepoint, as the lead Growth Strategist & Account Services Director, our team grew the agency to more than $25 million per year solely based on the principles of business model innovation that I break down below.

Before we dive into how to develop your winning business model, let me first break down the different types of Business Models as well as the Business Model Innovation framework.

Different Types of Business Models

Business Models are the lifeblood of any successful business. They are the foundation on which the rest of the business is built. 

There are many different types of business models, and all of them are designed to help entrepreneurs and business owners understand how their businesses make money. 

The most popular business model frameworks include the Business Model Canvas, Lean Startup, and Blitzscaling.New Paragraph

Revenue Models

No matter which business model you choose, it is important to understand how your business will make money. There are many different revenue models, and each one has its own pros and cons.

The most popular revenue models include subscription, pay-per-use, pay-per-click, advertising, licensing, and freemium. Each model has its own advantages and disadvantages, and which one you choose will depend on the type of business you have and the type of customers you serve. 

Business Model Canvas

The Business Model Canvas is a tool created by Alexander Osterwalder and Yves Pigneur that helps entrepreneurs and business owners create a visual representation of their business model. It has become one of the most popular business model frameworks and is used by thousands of entrepreneurs and business owners around the world.

The Business Model Canvas consists of nine elements, which are divided into four sections: Customer Segments, Value Propositions, Channels, and Revenue Models. It also includes a section to identify the Key Resources and Key Activities of the business.

Lean Startup

The Lean Startup is a method developed by Eric Ries to help entrepreneurs and business owners develop and test their business models quickly and efficiently. It is based on the idea of “validated learning”, which is the process of using customer feedback to validate or invalidate hypotheses about the viability of a business or product.

The Lean Startup method consists of four steps: Build, Measure, Learn, and Pivot. The goal is to reduce the risk of failure by quickly testing assumptions and making changes as needed.


Blitzscaling is a business model developed by Reid Hoffman and Chris Yeh to help companies rapidly grow their businesses. It is based on the idea of “hypergrowth”, which is the process of rapidly scaling a business by focusing on the most important activities and letting go of the rest. 

The Blitzscaling model consists of five steps: Set Ambitious Goals, Focus on the Most Important Activities, Move Fast, Invest in Scalability, and Take Calculated Risks. The goal is to help companies quickly reach their goals and achieve hypergrowth.

Business Model Innovation Framework

Now that we have discussed the different types of business models, let’s move on to the Business Model Innovation framework. This framework is designed to help entrepreneurs and business owners identify and optimize the five key areas of their business model.

Business Model Patterns

The first step in the Business Model Innovation framework is to identify the patterns in your business model. While each business is unique, there are certain patterns that are common to all businesses.

These patterns can be broken down into four categories: Customer Segments, Value Propositions, Channels, and Revenue Models. By understanding these patterns, you can identify the areas of your business model that need to be tweaked or optimized for growth.

How Inflows and Outflows Drive Innovation

Once you have identified the patterns in your business model, the next step is to understand how inflows and outflows drive innovation. In other words, how do the inputs and outputs of your business model affect the overall performance of the business?

For example, if you are running a subscription-based business, understanding how changes in pricing, packaging, or customer acquisition strategies can affect the overall success of the business is essential. By understanding how inflows and outflows impact the performance of your business, you can make informed decisions about how to optimize your business model for growth.

The Challenge of Focusing on Goals

Most successful Entrepreneurs are driven goal-oriented builders.

In fact, statistics prove that simply the act of writing down your goals makes it more likely you will achieve them.

But the next step… what you do AFTER you set the goal… is arguably 100x more important.

Yes, it is important to have a clear understanding of what you want to achieve with your business and how you plan to achieve it.

But there’s one aspect of goal setting that most Entrepreneurs (even the successful ones) get wrong. Make this one pivot and you’ll automatically increase your likelihood of hitting your goals AND the speed at which you hit them.

Focus your plan on improving the inflows and outflows of your business model, rather than the result itself.

Sure, you could set a goal to hit a certain revenue target, grow your customer base, or improve profitability. But as soon as you set the target, take your eyes off it.

And move your focus to the inflows and outflows that impact that target.

Similar to fitness, if your goal is to lose 10 pounds, write down your target “I will lose 10 pounds by X date” and then immediately take your eyes off the target (lose 10 pounds). And place your attention on the inflows and outflows: what you eat, and how much you exercise.

This may seem obvious when it comes to our health, yet in business, so many Entrepreneurs spend all their time focusing their strategy around the result, when they could speed up the process by simply applying the business model innovation framework.

Developing Your Business Model

Now that we have discussed the different types of business models and the Business Model Innovation framework, let’s talk about how to develop your winning business model.

Finding a Foundational Business Model

The first step in developing your business model is to find a foundational business model. This is the foundation on which the rest of your business model will be built.

Start by doing market research to identify a problem that your target customers are facing and determine how you can solve it. Then, create a value proposition that outlines how you plan to solve that problem. Finally, develop a revenue model that outlines how you will make money from your solution.

Once you have a foundational business model in place, you can begin to optimize and tweak it for maximum growth.

Optimizing Your Business Model for Long Term Growth

Once you have a foundational business model in place, the next step is to optimize it for long term growth.

Start by understanding your customer segments and developing a customer acquisition strategy. Then, develop a monetization strategy that is aligned with your value proposition. Finally, focus on developing an efficient and scalable operations model that will enable you to grow your business without sacrificing quality.

By optimizing your business model for long term growth, you can ensure that your business is built on a strong foundation that can withstand the test of time.

Business model innovation is an essential part of any successful business. By understanding the different types of business models, the Business Model Innovation framework, and the steps for developing a winning business model, you can ensure that your business is built on a strong foundation that will help you achieve sustainable growth.

Summary and Next Steps

By taking the time to research and understand the different types of business models and how they can be applied to their business, entrepreneurs can set the foundation for long-term success and sustainable growth. Taking the first step of creating a Business Model Canvas and using it to identify areas of their business that need optimization can provide entrepreneurs with the knowledge and insight they need to create a business model that is tailored to their needs. Taking this first step can have a huge impact on their business by increasing sales, expanding markets, and helping them build a business that is built to scale and last.

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