LLP@Tecnico�Class 7

Luis Caldas de Oliveira

Agenda for Class 7

• Q&A about Revenue Model

•  Team Presentations: Revenue Model Findings

•  Summary about Partners

• Work for Next Week

Q&A REVENUE MODEL

Important

Revenue Model ≠ Pricing

TacticStrategy

Revenue Model•  Asset sale �

Ford

•  Usage fee �Vodafone

•  Subscription fee �salesforce.com

•  Rent �Avis

•  Licensing �MS Office

•  Intermediation �airbnb.com

•  Advertising�Google

Revenue Model Choices

Pricing�(ways to charge)

Fixed•  Cost + profit�

(product based)

•  Value priced�(customer based)

•  Volume priced�(encourage volume)

Dynamic•  Negotiation�

(second hand)

•  Yield management�(airplane ticket)

•  Real-time market�(stock market)

•  Auctions�(ebay)

Common Errors•  Use “all-of-the-above” revenue models:

license, direct sales, affiliates, etc.

•  The reason to select a specific revenue model is unclear

•  Lack of understanding of how customers buy today.

• What do competitors charge?

•  Is the profit sufficient?

Metrics that Matter•  Value proposition: product cost, attainable market,

etc.;

•  Customer relationships: CAC, conversion rate, LTV, etc.

•  Market type: different revenue curves;

•  Cost structure: operating costs, etc.;

•  Channel: channel margins, etc.;

•  Revenue Streams: selling price, number of customers, etc.;

•  Burn rate: company spending per month.

TEAM PRESENTATIONS: REVENUE MODELS

PARTNERS

Key Partners

Partner

Types of Partners

Strategic Alliances�Apple + Record Labels

Joint Business Development �Intel Inside

Coopetition�wi-fi 802.11b/g/n

Key Suppliers�Outsource suppliers: Apple + Foxconn�Direct suppliers: �Logoplaste

Virtual Channels (web) �Expedia

Partner Relationship Diagram

NEXT WEEK

Presentation for Next Week

•  Slide 1: Cover slide

•  Slide 2: Business Model Canvas (changes marked in red, different colors for multi-sided markets)

•  Slide 3: Hypotheses about what partners are needed? Why?

•  Slide 4: Diagram the partner relationship with money flows. What are the incentives and impediments for the partners?

•  Slide 5: Lessons learned from interviews with potential partners.

Before Next Class•  Talk to at least 10 customers, including

partners

•  Update LPC Narrative and Canvas

• Work on your MVP

•  Prepare Class Presentation

• Watch Lecture 8: Resources, Activities and Costs

Obrigado