A year ago you had a good business model. Maybe the top line is still the same. But the world changes. Customer expectations change. Competitors pop up. Technology makes what was expensive trivial.
The business model you had 3 years ago? There are probably parts of it that don't hold anymore.
Most small companies don't test their business model regularly. Or at all. They say "it works," and then they leave it.
But "it works" doesn't mean "it's optimal."
What is a business model?
First — let's be clear about what we're talking about.
A business model answers the questions:
- Who should we serve? (The customers)
- What should we give them? (Value proposition)
- How should we deliver it? (Activities, partners, resources)
- How do we make money on it? (Revenue streams)
- What does it cost us? (Costs)
It's not a "strategy." It's the fundamental structure for how you create value and make money.
And yes — it can change.
Business Model Canvas
If you haven't met the Business Model Canvas, it's worth spending 30 minutes on. It's not complicated — it's a simple figure with 9 boxes:
- Customer Segments. Who do we really serve? (Not everyone. Specifically.)
- Value Proposition. What do we solve for them?
- Channels. How do we reach them?
- Customer Relationships. How do we stay in touch?
- Revenue Streams. How do they pay?
- Key Resources. What do we need to do it?
- Key Activities. What do we do?
- Key Partnerships. Who helps us?
- Cost Structure. What do we spend money on?
Draw it on a big paper. Fill it in. That's your current business model — as it actually works, not as you hope it works.
66 patterns you didn't know about
Here's the critical part: there aren't infinite business models.
Research has found around 66 repeated patterns in how companies make money. Subscription. Freemium. Pay-per-use. Marketplace. Franchise. Licensing. Auctions. Two-sided market. And many more.
The idea is this: if your current business model isn't working optimally, one of these 66 might work better.
Or a combination.
Many SaaS companies started with "payment per user per month." Then some discovered "but if we offer a free version, we can make money on ads for the free tier." Or: "if we introduce a premium tier, some customers pay more."
They didn't change the whole business model. They added a pattern that fit better.
Stress-test your model
Here's how you do it systematically:
Phase 1: Document (30 minutes) Draw your current model. All 9 boxes on the Canvas. What do you really solve? Who pays? What does it cost?
Phase 2: Evaluate (1 hour) For each box: what would have to change for it to be better?
- Customer segments: Should we focus more narrowly? Or expand to new segments?
- Value proposition: What would make our value more valuable to them? Or less? (Yes — sometimes you're over-serving.)
- Channels: Are we reaching them right? Through expensive channels? Through channels we don't control?
- Revenue: Are they paying too much? Too little? Are there other ways to make money?
Phase 3: Scenario (1-2 hours) Choose 2-3 of the 66 patterns that could fit. Draw them. "If we switched to subscriptions instead of one-time purchases, what would change?"
Or: "If we introduced a two-sided market — a bit like Uber, where customers and providers are both on the platform — what would happen?"
Phase 4: Ask critically
For each scenario:
- What would it mean for our costs?
- What would it mean for customers' willingness to buy?
- What would it mean for competitive position?
- What would it mean for our ability to scale?
- What could go wrong?
A practical example
A design agency had a problem. They made money on hourly work. More work = more money. But it also means more staff, and their best designers were always fully booked.
They couldn't scale without hiring massively.
They used the Business Model Canvas. Their current model:
- Customer segments: design agencies, small businesses
- Value proposition: high quality design
- Revenue: $150 per hour
- Costs: designers' salaries, overhead
The problem was obvious: their costs scaled as fast as their revenue.
They explored alternative patterns:
- Subscription for "on-demand" design? (Companies pay $1,500 per month for 8 hours of design, regardless of whether they use it.)
- Fees for design files? (Companies buy templates, not hours.)
- Licensing? (License design components to other agencies.)
They chose: subscription for on-demand design plus a few templates they could sell separately.
Result after 6 months:
- Subscription revenue was now 60% of revenue (stable, predictable)
- Same designers could service more customers (not all hours needed to be used, they could "share" designers between multiple subscriptions)
- They got 15-20% increased margin
They didn't fundamentally change what they did. They changed how they made money on it.
The "Rethink Now" method
If you really want to do it systematically, you can run it as a 4-phase sprint:
Sprint 1: Overview (Thursday morning, 2 hours)
- Draw your current model
- Gather data: what are your numbers? Margin? Customer satisfaction? Churn?
Sprint 2: Analysis (Thursday afternoon, 3 hours)
- Identify pain points
- What isn't optimal?
- What needs to change?
Sprint 3: Ideas (Friday morning, 3 hours)
- Explore 5 alternative patterns
- Draw them on Canvas
- Which looks most promising?
Sprint 4: Decision (Friday afternoon, 2 hours)
- What do we do?
- What do we test first?
- What could go wrong and how do we handle it?
One company did it over a weekend. Monday they were ready to test a completely new revenue model. They never would have done it without forcing themselves to take it systematically.
Start today
You don't need outside help. Get a big piece of paper. Draw the 9 boxes. Fill them in.
Then ask: what would be better?
It doesn't need to be revolutionary. But small optimizations to how you make money can quickly mean 10-30% extra margin — without changing what you do, only how you do it.