Your pitch deck business model needs to communicate the financial feasibility and viability of your project, solutions, or business to different audiences.

Feasibility pertains to the ease of implementing your solution.
On the other hand, viability concerns the financial aspect—whether your solution makes economic sense.

In this video series, you'll learn how to create a business model slide and what factors can impact your content choices.

Creating Your Business Model Slide

Your business model encompasses how your venture generates revenue, delivers value, and captures profits.

Here are key considerations when outlining your business model:

  • Revenue Generation: How does your business make money? Whether through product sales, subscription fees, or service contracts, reveal the revenue sources that sustain your venture.
  • Value Delivery: Describe how your solutions are delivered to customers. Delivery includes logistics, distribution channels, and customer service processes.
  • Profit Capture: Detail your pricing strategy and profit margins. Ensure that your revenue exceeds the costs of creating and delivering your solutions.

Your business model, while well-defined, should always be open to evolution in response to market feedback and changing circumstances. This flexibility is a key to your success, as it allows you to adapt and thrive in a dynamic business environment.

As you present your business model, remember that clarity and relevance are paramount. By effectively communicating how your venture creates, delivers, and captures value, you'll instill confidence in investors, resonate with your target market, and empower your internal teams.

Crafting a concise yet comprehensive business model slide can be challenging due to many factors influencing its content. Some factors include:

1. Revenue Model:

Your revenue model is at the core of your business strategy. It dictates how your business generates income. Common revenue sources include selling services, products, affiliate marketing, or licensing. Understanding your revenue sources and income types is crucial for mapping your business's financial landscape.

2. Product Category:

Product categories and how you acquire them can impact your income. Physical products require ongoing replenishment. Every time you sell a product, you must buy or make a new one. Digital products are easier to scale since you create them once, but you can sell them repeatedly.

3. Income Types:

There are various income types, including active, passive, and residual. Active income requires ongoing effort, while passive and residual income generates revenue with minimal ongoing effort. Knowing the distinctions between these income types is essential for developing a sustainable business model.

4. Transaction Type:

Different business transaction types, such as B2B, B2C, direct-to-consumer, and consumer-to-consumer, impact scalability and revenue potential. Each transaction type has pros and cons, influencing your business's market reach and profitability.

5. Customer Lifetime Value (CLV):

Understanding your customers' lifetime value helps you gauge your business's revenue potential. By estimating how much each customer will likely spend over their lifetime, you can tailor your marketing and retention strategies accordingly.

6. Customer Acquisition Cost (CAC):

CAC refers to the cost associated with acquiring a new customer. Balancing CAC with CLV is crucial for ensuring profitability and sustainable growth. High CAC relative to CLV can indicate inefficiencies in your marketing or sales processes.

7. Customer Support Cost:

Often overlooked, customer support costs can significantly impact your bottom line. Efficient customer support systems are essential for customer satisfaction while minimizing operational expenses.

8. Market Size:

Understanding the size of your target market provides valuable insights into your business's growth potential. Total Addressable Market (TAM), Serviceable Available Market (SAM), and Serviceable Obtainable Market (SOM) are key metrics for evaluating market opportunities.

By addressing revenue sources, income types, transaction types, customer value metrics, and market size, you present a compelling case to potential investors and partners.

Most pitch decks and sales presentations have gaps in their story. They don't address all the questions and objections the audience might have. However, with the efficient use of the Business Model Canva, you can quickly and effectively fill these gaps, empowering you to deliver a more comprehensive and compelling presentation.

The Business Model Canva has three main sections:

  1. Desirability: This section focuses on understanding the market need and customer demand. It includes customer segmentation and unique value proposition (UVP) elements. You can enhance desirability by defining your target market and aligning your solutions with their needs.
  2. Feasibility: This section helps you assess whether your business vision can be translated into reality. Key considerations include identifying necessary resources, key activities, and key partnerships required to deliver your solutions effectively.
  3. Viability: The viability section explores the financial aspects of your business model. You'll examine your cost structure and revenue streams to ensure your business is economically sustainable.

Tips for Using the Business Model Canva

  1. Keep it simple and move fast.
  2. Focus on the first income stream to generate revenue for your business, then iterate and experiment with additional revenue sources.
  3. Consult local experts, such as accountants and lawyers familiar with your industry and jurisdiction, to ensure legal compliance and sound financial planning. This step not only ensures your peace of mind but also strengthens the credibility of your business model.

The Business Model Canva is a powerful tool for evaluating and refining business models. By addressing key elements such as market desirability, feasibility, and financial viability, you can identify gaps and optimize your business model for success.

The primary goal of a business model slide in an investor pitch deck is to explain how the company intends to generate revenue. It must encapsulate the business model's essence while clarifying where the money will come from and how to sustain that income.

Designing your Pitch Deck Business Model Slide involves distilling complex concepts into a visually compelling format and showcasing revenue streams, diversification strategies, and market potential.

Contrary to popular belief, pitch decks aren't solely reserved for investment meetings. They serve as action-oriented presentations suitable for various purposes, including sales pitches.

In a sales-focused pitch deck, the business model slide takes center stage, elucidating two fundamental aspects:

  • How to Do Business with You: This entails clarifying the billing, invoicing, and payment processes. Potential clients need to know whether you operate on an hourly basis, offer monthly retainers, charge per project, or follow a different payment structure.
  • Clarifying ‘What They Get in Return ‘: Prospective clients are interested in the services, products, or results they can expect by investing their time and money in your offerings.

Tips for Effectiveness

  • Maintain Clarity: Avoid overwhelming your audience with excessive information. Focus on providing a clear and concise overview.
  • Emphasize Value: Highlight the benefits clients can expect from your offerings. Showcase how your products or services address their needs and pain points.
  • Encourage Engagement: Use your pitch deck as a conversation starter. Invite questions and discussions to delve deeper into specific aspects of your business model.

So, whether you're selling directly to consumers or businesses, ensure your business model slide addresses their key concerns and facilitates informed decision-making.

Business Model Slide Key Considerations and Tips:

  1. Prepare comprehensive slides tailored to the specific needs of investors, the market, and internal teams.
  2. Consult with financial experts to ensure investment and compliance with business regulations.
  3. Maintain flexibility in your business model to accommodate changing market conditions and stakeholder preferences.
  4. Foster a culture of continuous improvement, soliciting feedback and adapting your approach accordingly.
  5. Prioritize transparency and alignment within your organization, sharing pertinent information with relevant stakeholders while safeguarding sensitive data.

ACTION ITEMS

Create a business model slide(s) to explain the financial feasibility and viability of your ideas and solutions:

  • How your business/solutions make money
  • How buyers can do business with you
  • What details do you and your teams need to measure to justify the costs

IMPORTANT: Business and investment laws vary by location. Always consult a certified accountant and/or business lawyer to ensure your business model complies with your business jurisdiction.

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