Ten practical lessons from the business (revenue) models of ventures we reviewed today (or others you research) as they relate to the smart cities venture
- There can be two levels to models. Barefoot doesn’t directly make a profit, they get the money to train people through grants and contracts. But once they train people, those people bring it back to their communities and are able to sell and make a sustainable profit there. In other words: value creating is self-sustaining.
- It can take a long time to see revenue or to see your business finally get off the ground, Barefoot took 40 years.
- Reel Gardening donates their product when a customer buys from them. That is a way that they are making revenue, but also maintaining their social enterprise aspect.
- Greystone partnered with Ben & Jerry’s, which not only boosted their credibility and “popularity,” but also increased their revenue.
- Practically all these enterprises gain their revenue through various aspects, not confined to one item/product. Barefoot, for example, have campuses that sustain themselves, campuses that bring profit, donations, and other minor sources of income.
- In all of these social enterprises, while revenue is a major aspect, I feel like they focus more on their social impact than just getting the most money.
- It is important to be flexible and change your business as the market changes to keep revenue flowing.
- Appeal to emotion plays a significant role in attracting customers. Greystone is not innovating in their product (they’re just brownies), but their hiring policy plays a big role in attracting consumers that view discrimination against inmates as a problem.
- Envirofit focused on producing a product that is very simple to use and distribute, leading a wider range of potential customers. This can be applied to our venture (smart cities) by ensuring that our app is easy to use among the children in schools.
- Scale at the right pace to maximize impact. Envirofit invested in education programs before they launched their product and that led to the demand for clean stoves rising, thus before launch, they knew it was a success.