Business Model Canvas? Lean Canvas? It’s not when or how … but why!9 min read
One page business plan
A lot of organisations have — thankfully — moved away from requiring traditional “business case” documents when kickstarting an innovation project. Often people look (or are asked to look) at various variations of a one-page business plan “when” they need support and/or funding.
Whatever one-page business plan works for you. The “Business Plan Blueprint” is a one-page business plan that has combined aspects from the original Business Model Canvas/Value Proposition Canvas (Strategyzer/Alex Osterwalder), the Lean Canvas (LeanStack/Ash Maurya) as well as content from a number of pitch-deck templates (e.g. Sequoia Capital’s).
A recurrent question is for example “When do I fill in my Business Model Canvas?”, or something along the lines of “How do I fill in my Lean Canvas?” or “In what order do I fill in the boxes on the canvas?”.
The questions “when”, “how” or “what order” are probably an indication that a much better understanding on the “why” is urgently needed to better grasp the real value of using one such canvas.
The biggest difference between a “business case” and a one-page business plan is that a “business case” is usually created only once before the project starts in order to get funding. People who ask the “when” and “how” questions are inclined to unfortunately look at completing their “canvas” in exactly the same manner, as a one-off (forced) exercise.
Not “when” or “how”, but “why”
The core value of filling in a canvas is that it makes you step back and think about the bigger picture, all aspects (not just your solution) of your product. Having this overview helps you to identify and prioritise your product’s highest risk assumptions, to ensure you focus your energy on the things that matter most.
The reason a “canvas” is often seen as a replacement for a business case, is likely because it does help you to shape a clear vision and plan, which in turn allows you to put together a nice pitch. Unlike a business case, a “canvas” is not a one-off deliverable but it is a tool that is continuously updated based on the learnings from various experiments and prototypes along the way.
Whatever canvas works for you; Strategyzer’s Business Model Canvas + Value Proposition Canvas, Ash Maurya’s Lean Canvas, Business Plan Blueprint …
There is no one single solution or process that guarantees success, but innovations go through the following typical innovation stages.
1. Idea Spark
Innovation starts when someone has identified a problem they feel needs to be tackled. They have an ambitious vision of what the world would look like once this problem is solved and more often than not, this person already has an idea for a solution on how to solve the problem.
2. Shape Idea
The passionate idea creator bounces his idea off others who can then help to further shape the idea. This is an excellent place to start putting together a “canvas”.
Note: there are plenty of “Idea Management” tools that make it easy for others to discuss, collaborate, shape and vote for ideas.
3. Pitch Proposition Plan
Once an idea has sufficiently formed, the information from the one-page business plan can be translated into a pitch.
The most common reason for the “idea CEO” to pitch is to get support, which can be in the form of funding, resources, time …etc. The content and format of the pitch is more or less the same irrespective whether the pitch is internally in an organisation to find a sponsor, externally to find an investor (e.g. angel or VC investor) or even when looking at crowdfunding (e.g. Kickstarter etc, for crowdfunding a nice pitch video often improves the chance of success).
A pitch should always have a clear decision from the sponsor/investor with a clear “Yes” or a “No”. A “Yes” is a clear signal to execute the proposed planned next activities. A “No” may either require a minor change in prioritisation and plan, or learnings from previous experiments may demand a pivot, or it looks like the long term goal can not realistically be reached and it’s time to pull the plug.
The main purpose of a pitch is to have a clear purpose, goal, strategy and share a detailed plan with activities to validate the highest risk assumptions for the next months (recommended ~12 weeks). This will reassure a sponsor/investor so that they are comfortable enough to allow the team the time and space to execute the planned activities without interruption (i.e. no weekly update calls or bi-weekly steering committee meetings).
When the “idea CEO” is bootstrapping the start-up, funding or support may not be needed yet. It still makes sense however to formalise the plan to have a clear focus on the next steps (and optionally get agreement with any team members).
4. Execute Planned Experiments
After getting a “Yes”, the planned experiments will be kicked-off. These activities will be run in a lean and agile way to quickly get qualitative and/or quantitative insights to learn fast and refine the overall plan.
Note: experiments must always have a clear purpose with an upfront expected outcome to avoid that the innovator’s bias will simply find excuses for undesirable outcomes.
5. Update Plan Based on Learnings
The “canvas” must continuously be updated based on the learnings from the experiments. Which aspects of the one-page business plan have now been validated? Which assumptions were (in)correct? How do these learning impact the plan? Is the overall plan still valid? Is a change in direction needed? Does it even make sense to continue?
When continuing still makes sense, the next highest risks assumptions must be identified with an updated plan to validate them.
The updated one-page business plan can then be translated into a new pitch (i.e. go back to stage 3) to provide the sponsor/investor with an update on the learnings from the last ~12 weeks and propose the next plan and any new support requests.
From Canvas to pitch-deck
The content from your one-page business plan should be easily translated into the components for a typical pitch-deck.
The “Business Plan Blueprint” has the following 6 key components:
- Purpose, what is your proposition about? what is your problem and solution?
- Goal, where do you envision this is going?
- Strategy, how are you planning to achieve it?
- Status, what have you already done?
- Plan, what are your next planned activities?
- Support, what are you asking?
Note: for an indirect or platform business model your “1. Purpose” must be clear on the problem and solution for both parties (e.g. Uber solves a different problem for the driver and the passenger, AirBnB solves a different problem for the host and guest).
Business Plan Blueprint boxes to Pitch-Deck slides mapping
There are a lot of “pitch-deck templates” with mostly slight variations in the order of the key components. The content from the 6 “Business Plan Blueprint” components can be translated to the following pitch-deck slides:
- Purpose: A pitch start by making clear what your pitch is about and great way to do this is to start with a story of how you stumbled on the problem and show them what the world will look like after you have addressed the problem. From “1. Purpose” and “2. Goal” on the Business Plan Blueprint.
- Problem: Provide a bit more detail, explain why the problem is a real problem worth solving. From the Problem Space section of “1. Purpose” on the Business Plan Blueprint.
- Competition: Sometimes the competition can be mentioned when explaining the problem and who is complaining about how poor the current alternatives (i.e. your competition) are. From the Problem Space section of “1. Purpose” on the Business Plan Blueprint.
- Why Now: Timing is key too, to create a sense of urgency and explain why you believe now is the right time to tackle the problem. What recent/upcoming technology, behavioural or other developments have up until now prevented others from solving this problem before. From “2. Goal” on the Business Plan Blueprint.
- Solution: Describe the value your solution will create and highlight what it is that makes your solution better than the competition, current alternatives and workarounds. From the Solution Space section of “1. Purpose” on the Business Plan Blueprint.
- Market: What is your long term goal that will make this a success? How much revenue do you expect to capture? From “2. Goal” and “3. Strategy” on the Business Plan Blueprint.
- Business Model: Elaborate on how are you planning to capture value, who do you expect to pay for your solution. How many do you envisage to convince swapping to your solution. From “2. Goal” and “3. Strategy” on the Business Plan Blueprint.
- Financials: What are the expected financial details and where are you now. What are the numbers you have achieved and how do they compare to the overall strategy. From “3. Strategy” and “4. Status” on the Business Plan Blueprint.
- Status: Share what have you done so far and which aspects of this plan have you already validated and how. What have you learned so far? What are your next planned activities and why: What are your current highest risk assumptions and why? How do you plan to validate these and what is your expected outcome? From “4. Status” and “5. Plan” on the Business Plan Blueprint.
- Team: Given the next planned activities, who has been the team behind this proposition so far and who will be the dream team behind it going forward. From “4. Status” and “5. Plan” on the Business Plan Blueprint.
- Ask/Offer: What support are you asking for and what will this support be used for. Investors will also want to know what they are offered for their support. From “5. Plan” and “6. Support” on the Business Plan Blueprint.
The Pitch/Execute/Plan cycle can be seen as an infinite loop of updates and sharing of the next planned activities. As the startup grows and matures into an established business, things may continuously change e.g. technological developments or when other alternatives emerge. Having a realtime Business Plan (Blueprint) allows you to keep an eye and focus on what really matters!