Six Strategies for your Business Model
“To me, ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions.” – Steve Jobs
Developing a great tech idea is easy for many entrepreneurs, but the ability to create something that is scalable, is useful for customers and solves real problems can be a challenge. For innovation to excel, entrepreneurs must have the ability to execute, and this is dependent on the business model.
At Farm491 we work with a number of fast growth innovative companies. With there being so many different business models out there, it can be difficult for entrepreneurs to choose the right one for their business. Sometimes a combination of several can create the perfect mix.
We work closely with our members to distinguish what makes a business model work, and Project Breakthrough have addressed this with six business model levers. Execution isn’t dependent on all six of these being implemented, as each company’s culture and strategies will require a different combination.
- Personalisation
- How to meet customers unmet needs at scale. Delivering individually-tailored products and services, leveraging tech to achieve this competitively. Uncovering unmet needs aligned with individual, societal and environmental wellbeing is key.
- Asset Sharing
- How to unlock the access economy. Asset sharing connects spare capacity with demand, allowing consumers access rather than forcing ownership of a product or asset; often massively reducing adoption barriers.
- Collaborative Ecosystems
- Optimising your competitiveness network. From tackling systemic challenges with competitors, to co-creating with customers and better allocating risk to suppliers – collaboration is a key way to solving problems and scaling solutions.
- Closed-Loop
- How to do dramatically more with dramatically less. Closed-loop systems keep products and materials at their highest utility and value. This reduces the need for extracting and processing new resources, cutting environmental impacts whilst saving costs.
- Usage-Based Pricing
- Paying only when in use, incentivising positive behaviours. Customers pay for the use of a product or service, rather than bearing ownership costs. Whilst offering both convenience and affordability to customers, it can also incentivise positive, lean behaviour.
- Agility
- How failing fast can build resilience. A company’s ability to detect and monitor changes in its internal and external business environment can help it to respond dynamically, allowing it to ‘pivot’ to where the best opportunities may lie.
Below are some characteristics of these models seen at Hello Tractor. Read through and see which of the above fit into this business model.
Hello Tractor
- A platform that allows small-holder farmers in Africa to get temporary access to tractors on demand.
- The platform tracks available tractors and each piece of equipment as it’s used.
- They have a partnership with global tractor manufacturer, John Deere, who sells tractors to contractors who then rent them on the platform.
As you may have noticed, Hello Tractor include a number of the business model levers. For small-holder African farmers, most farm work is done manually, so even the simplest of jobs can take days or weeks to complete. Hello Tractor have recognised this and created a business model that fulfils the needs of their customers whilst also generating revenue. The business model also favours John Deere who have gained a larger customer base.
If you are an AgriTech/agri-food entrepreneur looking to scale, wanting to discuss your business model, or would just like to learn more about Farm491, then please get in touch with sarah.carr@rau.ac.uk.
About Sarah Carr:
At Farm491, Sarah ensures Farm491 are engaging with AgriTech entrepreneurs whilst also sourcing strategic partnerships within the industry. As well as developing content-led events, Sarah also co-delivers Farm491’s Inspiring AgriTech Innovation Programme, leading a session on “one-page business plans” and “pitching to investors”.” Having grown up on her family farm in Shropshire and her previous role as a Farm Trader for an agricultural merchant, making a business model work for farmers is a core interest, as well as the challenges of a sustainable farming system, both environmentally and also for farmers themselves.