Advanced Business Models

By Bruce Firestone | Uncategorized

Dec 31

(IOE5100 for Entrepreneurs,
Intrapreneurs and Artpreneurs, suitable for persons at 3rd or 4th year
university or Masters level of understanding and commitment)

Startup DNA


study with Professor Bruce M Firestone, B Eng (Civil), M Eng-Sci, PhD. In less
than a week, he will help turn you into a creative, focused entrepreneur,
artpreneur or intrapreneur with a world class business model. He is a leader in
designing and building business models for the 21st century that allow you to
compete and win in a tough competitive world.

will take you on an exciting voyage, looking first deep into the past (as far
back as the beginning of trading economies circa 10,000 B.C.) and then show you
models from the past decade and the new one we are currently in that may amaze
you—ones that generate cash on three sides (not only seeing cashflow from
customers but also from suppliers and via its marketing dimension as well).

will learn how it is now possible for the first time ever to reverse out much
of your work, to create mass customization in products and services, turn
products into services and vice versa, engage in negative cost selling and
negative cost marketing and much more.

Schedule and Content

six sessions, you will learn/study and do the following:

L1, Business Models for the 21st
Century—Integrating the Internet into the DNA of your Enterprise. Slide deck: PPT file, PDF file (Lecture 9 am to Noon, followed
by lunch)

L2, Case Studies of
Self-Capitalized Enterprises—Creating Powerful, Innovative Value Propositions
and Sustainable Competitive Advantage through Differentiation. Creating/improving
new products and techniques in existing established companies. Slide deck: PPT file, PDF file (Lecture 9 am to Noon, followed
by lunch and one hour workshop)

L3, Self-Capitalization for the
Modern Enterprise—You are never too big a company to use Bootstrap Financing
techniques. Slide deck: PPT file, PDF file (Lecture 9 am to Noon, followed
by lunch and afternoon team building exercise)

L4, Turn Selling into
Buying—Effective Customer Acquisition using Negative Cost Selling, Guerrilla
Marketing, Social Marketing and Earned Media. Slide deck: PPT file,PDF file Assignment (Blue Heron Storage
Case Study):
Blue Heron Storage Corp Blank Spreadsheet: PDF file, Blue Heron Storage Corp Answer
Spreadsheet: PDF file, XLS file (Lecture 9 am to Noon, followed
by lunch and one hour workshop)

L5, Corporate Organization and
Structure for Entrepreneurs, Intrapreneurs and high level management—Creditor
Proofing Yourself. Slide deck: PPT file, PDF file (Lecture 9 am to Noon, followed
by lunch)

Student presentations beginning at 9 am, celebratory lunch/dinner with prizes/surprises

Course is available through MBA
program at University of Ottawa’s Telfer School of Management, Exploriem Entrepreneur
Network/Learn By Doing School
Hyper Island Institute in Stockholm,


will complete these assignments:

Build/Improve/Adjust your Business Model and draw it up as a one page Business
Model Flow Chart (40%)
B. Draw a Message Map* outlining your value proposition (15%)
C. Produce and record your 2-Minute Elevator Pitch on YouTube (public or
unlisted) (20%)
D. Present your Business Model# (25%)

# This should include: i. a one
page spreadsheet showing how value is created for one individual client or
customer, ii. a second spreadsheet that is a Financial Model of your enterprise
(how one client or customer creates impacts cashflow), iii. a Cash Conversion
Cycle spreadsheet (for more about CCC, please refer to:,
iv. a written summary of your Business Model that is 2-pages long which also
shows how you built leverage into your business model, v. a PowerPoint
slidedeck used in your presentation with names of all students on your team.

Please note that the final
presentations may also be structured as a business model competition similar to


what you will take away from IOE5100:

Entrepreneurs Handbook II available from You can read the Foreword here: You can also read the first
two chapters by downloading them from:
B. Student Entrepreneur Business Model
C. Your Message Map*
D. 2-minute Elevator Pitch video on YouTube (public or unlisted)
E. Course Certificate

(* Learn more about message maps

Constructing Business Model and
Business Model Outputs

will produce an elite level business model and accompanying outputs demonstrating:

Ability to execute
· Differentiated value
· Low value or negative cash conversion cycle
· Benchmark
· Self Capitalize
· Effective marketing dimension
· Building cashflow
· Mass customize/integrate the Internet into business processes

Business Model Evaluation

Executive Summary – The executive summary is thorough and informative as a
stand-alone document. It encourages and entices the reader to read more.
Maximum of two pages.
2. Industry & Organization – The industry and competitors are clearly
understood. The enterprise, concept, business model, product or service are
clearly described. It has high growth potential.
3. Market Research and Marketing- The market size and trends are understood.
What is the company’s value proposition? The model provides linkage between
supply chain, enterprise and customers. Pricing scenarios are realistic, as are
marketing tactics. Is there demand for the product/service?
4. Innovation and Differentiated Value – Does the business concept demonstrate
innovation and creativity? The competitive advantages of the specific
opportunity are well articulated. Is there a short time to market and high
growth potential? There is a clearly articulated entry and growth strategy.
5. The Economics of the Business – There is clear and logical cost, margin and
6. Financial Model – The financial model presented links customer acquisition
to top line and bottom line performance.You also need to examine your cash
conversion cycle, CCC. Models that have a negative CCC are more highly rated
because, as they go, they have more cash on hand and need less third party
7. Ability to Execute – Why you and your team? Founders have skills and
experience appropriate to the opportunity.
8. Capitalization – Feasible for entrepreneurial or intrapreneurial startup?
9. Mass Customization – Scalable, high growth enterprise?
10. Viability & Overall Impression – Reflects overall quality and
articulation of model. Is the enterprise going to be around in 5, 7, 10 years?
The venture makes sense and could be a real business.


M Firestone is best known as Founder of the Ottawa Senators, Scotiabank Place and Ottawa Senators
Foundation but he has also participated either as principal or advisor in more
than 172 other startups and counting. He is a civil engineer from McGill University
in Montreal and has his Masters of
Engineering-Science from the University
of New South Wales in Sydney
and his PhD in Urban Economics from the Australian
National University’s
Urban Research Unit in Canberra.

May of 2006, Dr Firestone joined the University
of Ottawa’s Telfer School
of Management at as its first Entrepreneur-in-Residence. He previously taught
or studied at McGill University (Bachelor of Civil Engineering), Laval
University, Harvard University, University of Western Ontario, University of
New South Wales (Master of Engineering-Science, Traffic and Transportation),
Australian National University (PhD in Urban Economics) and Carleton
University. Prof Bruce is now Entrepreneurship Ambassador for the Telfer School.

is also Executive Director of, a Canadian registered
Not-For-Profit corporation focused on educating and mentoring entrepreneurs,
intrapreneurs and artpreneurs in Canada and around the world. He is
also coaching and teaching via Learn By Doing School, an organization dedicated
to providing student entrepreneurs with access to research, education and a
network of high achievers not available elsewhere. Prof Bruce is also an
effective keynote speaker for organizations with a positive focus on creating
opportunity for their stakeholder group.

Prof Bruce is also an author having
written the Quantum Entity Trilogy, Entrepreneurs Handbook II and Urban Nirvana
(2015). His writings are available from

His CV is posted at:

Prof Bruce

Bruce will help you become a more creative, focused entrepreneur with a world class
business model that will allow you to compete with the best in the world.

Follow up Mentorship

provides each of its students with 6-month and 1-year individual follow ups
with Prof Bruce.

Course Pre-Preparation

1. Please get a free Twitter account
and follow: @ProfBruce. We will be using the hashtag #IOE. Please read ‘Twitter Nation‘.
2. Take the ECQ Test. Send
your score to bmfirestone @
3. Give some thought to the Business Model you wish to build during this
course. Please read: Things Every Tech Startup
Needs to Know about Business Models
 andThe Complete Business Model.
The more of these elements that you can incorporate in a new or existing model,
the more you are likely to prosper.
4. Run your preliminary business model** (the one you would like to work on
during the course) through our online utility, the Business Model Generator
(see: and bring the
outputs with you.
5. Get ready to make a 2-minute YouTube elevator pitch video (public or
private) by reading ‘How to Make a Great Elevator Pitch’: Word Doc. Then
record a trial 2-minute Elevator Pitch** and put it on YouTube (public or
unlisted). Your pitch is the product/idea you or your company would like to
develop and launch to complete or improve your business model and increase
revenue. To improve your value proposition and elevator pitch, please read: How
to Make an Elevator Pitch (
and Elevator Pitch Workshop (
6. Before you create or record your elevator pitch, it is worth spending time
composing a message map. A message map summarizes your value
proposition and helps you to prepare to make your elevator pitch which will be
15 seconds to (not more than) 2 minutes long. More about message maps here:
7. Please also read: Should Every Person on the Planet have a Personal Business
For Life (PB4L)?

You will compare your preliminary business model and your initial 2-minute
Elevator Pitch with the final ones you will create during the course—to measure
your progress and evaluate outcomes.)

Ten Reasons to Attend IOE5100

you a talented entrepreneur, artpreneur or intrapreneur? Are you working or
planning on becoming a product manager, supply chain manager, high level
executive or enterprise founder? Are you a 3rd or 4th year or MBA-level
student? If so, here are ten reasons why you or someone from your organization
should take this course:

Receive an IOE Certificate for course work in a condensed one-week period.
2. Create and improve your Business Model so the harder you work, the more
money you make.
3. Craft and improve on your value proposition and then turn it into a
fantastic elevator pitch and YouTube viral hit.
4. Learn and expand your knowledge about business models, self-capitalization
for modern enterprises, effective customer acquisition using Negative Cost
Selling, Guerrilla Marketing, Social and Earned Media.
5. Take advantage of personal mentoring by Prof Bruce during the course as well
as a 6-month and 1-year follow up with Prof Bruce! Gain access to our
Newsletter only available to former students and members.
6. Surround yourself with competitive individuals who share your passion for
entrepreneurship, artpreneurship and intrapreneurship.
7. Learn the entire entrepreneur skill set—A to Z.
8. Take a one-week, learning, guilt-free ‘learning vacation’ and escape deadly
9. It includes team building and cool takeaways (Entrepreneurs Handbook,
YouTube Elevator Pitch, Biz Model, Graduate Certificate and more…)
10. It’s cost effective/world class/fun.


you can’t be running a startup in Ottawa
and not have benefited from Prof Bruce’s wisdom in some way. His credentials
would take a whole page to write but in a nutshell, he is Founder of the Ottawa
Senators, is Executive Director of a business incubator called
and with his knowledge and experience he is one of the best advisors I ever
had!” Vahid Jozi.

course filled a hole in the MBA program – business modeling is an essential
skill for all MBA grads regardless of whether he/she is an entrepreneur or
manager. The experience was enhanced by Prof. Bruce’s innovative teaching
style. Of the 20 MBA courses I’ve taken, this one is in the top two!” J.

DNA was different from any MBA course I have taken to date. It provided me with
both a practical understanding and creative outlook on the how to’s of building
a business model. Prof Bruce equips you with the knowledge and the courage to
stop ‘thinking’ about entrepreneurship and start ‘doing’ it – all the while
reviving your entrepreneurial spirit. Thank you Prof Bruce!” Ziad Geagea

Culture is invaluable to anyone interested in becoming an entrepreneur,
intrapreneur or wants to create a start-up and reap the benefits. It forces you
to think in business models, relationships and ecologies, to take ideas and
turn them into strong value propositions for individuals, and to stand alone;
looking at a market and measuring yourself in the success you create with your
ideas, determination and leadership. You don’t only learn how to work hard, but
how to reverse out the work as well. It changes the way you think about
business and the possibilities beyond just a carrier, but a way of life and
thinking,” Craig Schoen.

What Steve Jobs and Sam
Palmisano Think about Biz Models

Jobs figured out how important biz models are before he launched the iPhone
when he insisted that AT&T* give him a share of their subscriber revenues
in return for a two year exclusivity on the device. With that, he
revolutionized yet another industry’s biz model. Cell phone manufacturers went
from selling a ’shrink wrapped’ gadget for a one-time payment in a brutally
competitive market with poor margins that was racing to the bottom to an
industry with multiple sources of revenues (ads on the iOS platform, iTunes
downloads, app store sales and revenues, search fees, streaming, subscriber
revenues, sale of the device itself), some of which are recurring: the holy
grail of techdom.

(* (
reports that the iPhone represented 80% of all AT&T smartphone activations
in the last quarter of 2011 during which they added 9.4 million new
subscribers, 50% more than in any previous quarter in company history. We
estimated that the iPhone is returning a phenomenal 288% p.a. to Apple making
the platform and the device perhaps the single greatest tech profit generator
ever. Please see:

Palmisano, when he was CEO of IBM told BusinessWeek (April 3rd, 2006) why he
places a great deal of emphasis on the importance of business model innovation.
He said: “…with product innovation, it’s a certainty that your competition is
shortly going to copy what you have done. With business-model innovation, though,
if you can come up with a unique way of doing things, it’s much tougher to
react to.” Mr. Palmisano spent approximately 40% of his time as CEO on IBM
business models.

For More Information about This
Course or Others:

contact, Mr Alex Wolfe, 1.613.566.3436 x 204 Email alex.wolfe @
Twitter: @alexwolfe12

Postscript: More on Biz Model

Complete Business Model should include:

1. A one page Business Model Flow
Chart. Start by using our online Business Model Generator, BMG (
to get a sense of what your final model might look like. Then improve it and
let it evolve to describe using a pictogram the entire ecosystem that your new
enterprise will live within. Your Business Model will show your ECQ Test Score,
your ‘Pixie Dust’, source of Bootstrap Capital and Guerrilla Marketing/Social
Marketing ideas, your Guerrilla Marketing Test Score and your Business Model
Test Score. The BMG will lead you through this process. Try to select the right
idea for your next startup (read Ten Things Startups Forget to Do: Create a business model for
the 21st Century that will produce great results so that the harder you work,
the more money you make and so you can compete effectively with hard charging
entrepreneurs from China, India and other Tigers by having a business model
that can not be easily duplicated or dislodged and gives you a lasting,
sustainable competitive advantage and concession or franchise.

not only your clients and suppliers but the whole network or ecosystem: clients
of your clients and suppliers to your suppliers.

Becoming part of your business
ecosystem is one of the keys to longterm sustainability for your enterprise.
Add some differentiated value, innovation and ‘pixie dust’ to your business
model. Self-capitalize (bootstrap) your new enterprise so that you end up
owning it and not a VC firm or other investors or partners (please see
Bootstrap Capital, the Last Word: And use some smart marketing
(guerrilla marketing and social marketing) so you can acquire customers and
clients cost effectively (please read Guerrilla Marketing Basics:

2. You will also need to develop a
one page spreadsheet showing how value is created for one individual client or
customer. Here are some examples of how to demonstrate your Value Proposition: Value Proposition of a Residential Realtor,
the spreadsheet,Value Proposition for a HR
, the spreadsheet.
You are demonstrating in a clear and concise way how your new
enterprise/product/service/division creates either lower costs or higher
revenues (or hopefully some combination of both) for one customer.

3. A second spreadsheet is required
that provides you with a Financial Model of your enterprise. Having done quite
a bit of work in the field of urban economics, it has always amazed me that
most cities, for example, don’t have a financial model that can tell them what
the fiscal implications are of one more resident or, for that matter, one more
firm locating in their town. Most cities have budget processes that are a mess.
I produced a financial model for a backorder domain name service that you can
use online:
From this model, the firm can see what impact each additional client has on the
top line of the firm. The firm is also able to test the sensitivity of its top
line to changes in the success rate of backorder capture, changes in its COGS
(Cost of Goods Sold) and other variables.

value proposition for your clients and their impact on your business (which is
measured in your financial model) are mirror images of each other. We complete
the business ecosystem when your suppliers provide you with their value
proposition and you also insist that they have a financial model of how your
business impacts them. Why should you care if your supplier’s have a workable
financial model? Well, the long term viability of your firm depends in part of
a stable supply chain and it won’t be stable if your suppliers are failing on a
frequent basis.

4. Make sure you also understand
what a Cash Conversion Cycle is and how to calculate it for your enterprise.
Please read Cash Conversion Cycle, CCC: How the CCC Affects Your Internal
Rate of Return, The Power of Leverage to Work for You and Against You, and
Effectively Manage your Enterprise
by Measuring your Cash Position. Here is a spreadsheet example for calculating
the CCC:

5. You will produce and record a
2-munite video of your Elevator Pitch and load it to YouTube ( public or
private) for viewing in class. See: and
Here is a sample elevator pitch given by student entrepreneur, Daniel Beachamp:
Sean Wise has a humorous but useful take on what makes a good elevator pitch:

If you can build leverage into your business model, a means to multiply the
force exerted by your own efforts, time and brains, you will have a greater
opportunity to succeed. Leverage in your business model comes primarily from
these principal sources:

great HR,
ii. using OPM,
iii. forced savings,
iv. innovation,
v. capital equipment,
vi. location,
vii. network effects,
viii. marketing channels that reduce the problem from one to many to one to a
ix. branding, co-branding, co-opetition and co-creation,
x. inflation.

your biz model: ask yourself do you have great HR, are you using OPM,
benefiting from forced savings, innovating, do you have a great location or
brand, does your enterprise benefit from network effects or marketing channels
that allow you to connect cost effectively with your clients or customers and
reduces that task from one to many to one to a few and is your capital
equipment top notch/best-of-breed & do you benefit from inflation? If so,
you are probably maximizing your leverage.

of this blog will know that I think that after your decision to actually start
a new enterprise, your next most important decision arrives when you hire your
first employee.

talented people that produce revenue streams not assets so always try to hire
‘up’. I look for people with the right set of skills and experience but I am
also looking for people with ‘good hearts’. These folks won’t quit when the
going (inevitably) gets tough. To read more about this, see:

is what the Oracle of Omaha had to say on the issue. It may take a few seconds
for the lesson to become clear.

looking for people to hire, you look for three qualities: integrity,
intelligence and energy. And if you don’t have the first, the other two will
kill you. You think about it; it’s true. If you hire somebody without
[integrity], you really want them to be dumb and lazy,” Warren Buffett.

using OPM is increased when the project’s or business’ rate of return is higher
than money you borrowed. Or when you use bootstrap capital, say, trade credit,
where a supplier gives you credit at low interest or no interest to buy from
them or a customer gives you a deposit on an order on which you pay no
interest, you are then leveraging your own efforts and capital with theirs.

also get leverage when other people are paying off your debts. This happens
when, for example, you own rental property. Every time a tenant pays their
monthly rent and you pay off some of the principal using their rent, you
experience a form of forced savings and a wealth effect.

have spoken to the need to have some type of innovation in your business model;
as we saw above, Steve Jobs proved that you can think your way to wealth a lot
faster than you can work your way there. That’s big-time leverage…from ideas.

would also appear self-evident that having top notch capital equipment provides
greater leverage for your employees and means higher productivity.

also get leverage from your location and your brand. In real estate terms, if
you occupy a particular location, it obviously means that no one else can, so
make it a good one. I

people think that having a great brand is nice, actually it’s essential. A
strong brand creates trust and trust creates the opportunity to sell. Think
about it? Ever bought anything from someone you didn’t like and didn’t trust?
If you did, it was only once.

a brand does other things for you. For example, Apple’s incredible brand, its
reputation for building insanely great products, allowed Steve Jobs to cajole
out of AT&T a share of their monthly subscriber revenues for the launch of
the iPhone, something that no other telecom had ever granted to a cell phone
manufacturer before.

phone manufacturers went from selling a ’shrink wrapped’ gadget for a one-time
payment in a brutally competitive market that was racing to the bottom to an
industry with multiple sources of revenues, some of which are recurring: the
holy grail of techdom.

how much harder Steve Jobs and Apple would have to work and how much lower
their productivity as measured in revenue per employee would be without
recurring revenues from iPhone app sales and revenues, advertising revenues on
their mobile platform, downloads of paid content from iTunes and a share of
their carriers’ subscriber fees.

a simple question, asked by Steve Jobs, and a tweaking of his business model
flowed great benefits. The harder they work, the more money they make and, in
Apple’s case, this relationship has become geometric.

has created radical change in industry after industry: personal computing (the
Mac), animation (Pixar), music (iPod), cell phones (iPhone) and now
book/newspaper/magazine publishing (iPad) plus perhaps television and film
(Apple TV). It is truly a remarkable record of achievement.)

was almost tempted to add a 11th form of leverage: the power that comes from
co-branding, co-opetition and co-creation. Co-branding is poorly understood and
vastly under-exploited. Here’s a simple example. If I was responsible for
marketing BMW cars, I would ask my self what else people who buy BMWs also buy.
For guys, maybe it’s a Harry Rosen suit and a Rolex watch. So perhaps my TV
commercials would show men dressed by Harry Rosen looking at their Rolex
watches as they step out of their BMW before playing Texas Holdem for multi-million
stakes. These four brands might share marketing costs but more importantly,
they leverage off each other. People who like to play Texas Holdem get
introduced to BMWs and vice versa.

I was marketing say promo products, I would use co-branding a lot. Suppose you
want to sell mouse pads to golf pros to give out to their clients. Club pros
usually don’t have much money but some of their students such as lawyers and
accountants do. So co-brand the mousepads with all three. The lawyers and
accountants will pay for it (because they want to put their names in front of a
golf-playing public and this is a cost effective way to do that) and golf pros
will hand them out (because it’ll be sitting on someone’s desk basically
saying: ‘Wouldn’t you rather be golfing?’ and ‘Learn from the best! Call me now
for your next lesson at 613.mmm.nnnn!’).

I was advising S3, Select Start Studios on how to build their newsletter list
(see: My advice? Invite third party content.

At, we get a tonne of stuff from people in our ecosystem for our
monthly newsletter: entrepreneurs with new products or services, Profs who’ve
come up with clever new algorithms or pieces of research ready for
commercialization, providers who cater to our market (entrepreneurs and
intrapreneurs/product managers) with new services to announce…

not only provide us with more cool content, they become ambassadors for our
newsletter– they have a stake in it and a stake in getting more readers for it.
This is also a form of co-branding and there absolutely needs to be more of it
because it provides big leverage for both. Basically, it introduces our entire
ecosystem to our suppliers’, clients’ and partners’ separate but overlapping
ecosystems that will almost never be entirely either one or the other.

form of co-branding is actually also a form of co-opetition and a source of
leverage. Why do Starbucks, McCafé, Second Cup and local Bridgehead Coffee all
tend to gather near the same geographic locations? It’s so that: a) that area
gets branded as a coffee haven and when people feel the need, they think of a
place where they have a wide choice, hence overall market grows, b) marketing
by any one of these enterprises benefits the others in the group, c)
unsatisfied demand is reduced (for example, if lineups are too big at
Bridgehead, they can go to Starbucks and vice versa.)

how it works in the home building biz: two builders construct model homes
across the street from each other and ‘compete’. One is a stucco builder, the
other brick. They both advertise like heck. Someone comes to see Builder A (the
stucco guy). “Ugh,” they say. “I hate stucco.” So they cross the street and buy
a nice brick home. Someone else comes along and says: “Brick is like so like
last century” so they go buy a stucco home.

if Builder A was alone, maybe he sells 1 out of 3 clients. The other two wonder
off to some other part of the city. Builder B is experiencing the same thing.
But if they co-locate and co-brand (even if it’s really a form of
co-opetition), 1 of 2 unsatisfied clients crosses the road (going both ways)
and their success ratios have changed from 1 in 3 to 2 in 3. So the equation
1(3) + 1(3) = 2 sales (read ‘1(3)’ as a success rate, i.e., ‘one of three’) has
now changed to 2(3) + 2(3) = 4 sales. THIS IS HUGE LEVERAGE, right?

is what happens in the Apple universe when you open up a platform like the
iPhone or iPad to app developers. It turns out that an active, broadly
developed app marketplace is essential to the sale of iPhones and iPads and one
of the reasons for Apple’s wide lead in smartphones over previous leader RIM
and Blackberry. By leveraging the talents of a huge number of unpaid (by Apple)
developers, they extend their brand and significantly boost the utility and
revenues of their devices sharing some of that bounty with third part app

decided (unintentionally) to do just that after launching the Kinect:

weeks of launching Kinect, someone had hacked it and there was open source code
on the Internet. Instead of freaking out, they decided to run with it and
create a software development kit. It’s thinking like this that will make
personalization and co-creation a key driver for how brands and companies create
closer relationships with their customers,” Sondre Ager-Wick, Head of Design
Strategy and Foresight, Nokia, December 14, 2011

does something along these lines by inviting artists to submit T-shirt designs
for production after a voting process takes place amongst their community. Biz
models are developing or discovering new and interesting sources of leverage
that have never been possible before.

most obvious example of network effects is the facsimile machine. I was
actually one of the first people in Ottawa
to get a fax machine. The problem was: what if you had no one to send a fax to?
I had to work hard to get my law firm to install one. They asked me: “Why do we
need it? We have couriers for that?” “But imagine if I could send you to
documents in minutes instead of hours?” I responded. “How cool would that be.”

the only fax machine in a town or having a fax machine that uses a communications
protocol that is different that everyone else’s, is pretty useless. Having a
video player that works with Beta isn’t much use if all the tapes are VHS.

recently, network effects are apparent in Apple’s app store, Google’s search
engine algorithm, Skype’s video calling, in fact, anything that verges on
becoming a standard can also create the potential for network effects to take
hold. You can read more about how standards are creating wealth, please refer

is also generated in Business Models that somehow manage to reduce the one to
many marketing problem to one to a few. This is done, for example, by
developing sales channels that include resellers. We worked on this for Amy
Yee’s EventBots business. You can see our handwritten notes on this at:
Essentially, practically everyone on the planet will have at least one event in
their lives that they will want to record; e.g., their weddings! So, in theory,
EventBots could market to 7 billion people. Not very practical.

we worked on a model that would see EventBots selling to Wedding Planners,
Event Managers, Hotels, Convention Centres, Marketing Agencies and Media
Companies, political organizers, anyone who might want to record in a
meaningful way some event they host or organized. This builds plenty of
leverage in Amy’s model.

marketing efforts also generate leverage for you when you use a non-linear
selling model:

if you are in an industry that is experiencing price inflation, you are
benefiting from asset value increases without putting in any effort of your
own, i.e., more ‘free’ positive leverage for you. That is why it is almost
always better to enter into buoyant sectors where ‘all boats are rising’.

Lastly, you will need to write a Summary of your Business Model that is 2-pages
or less that summarizes:

a. Your value proposition including
its ‘pixie dust’ (
or differentiated value and how you can create a sustainable competitive
advantage. Make sure that you are abundantly clear about the costs and benefits
that you are creating for each customer.
b. How you can acquire customers and clients, including pre-launch clients, in
a cost effective manner through guerrilla marketing, social marketing or direct
marketing. Explain how you might use negative cost selling to achieve this:
c. How you integrated the Internet into your business model. (See:
d. How you can bootstrap your business and self-capitalize it (
e. How you will build cashflow and create a cash conversion cycle that is
workable (
f. Why you and your team are the right people to execute this model.


Bruce M Firestone, B Eng (Civil), M Eng-Sci, Phd. Founder, Ottawa Senators;
Author, Quantum Entity Trilogy, Entrepreneurs Handbook II; Executive Director,; Broker, Century 21 Explorer Realty Inc; Entrepreneurship
Ambassador, Telfer School of Management, University of Ottawa. 613.566.3436 X 200. @

Comparables from Schulich
Executive Learning Centre

Certificate in Business Analysis/Program Fee: $9,450 CDN + applicable taxes

fee includes full 9-module program tuition, all teaching materials, iPad 2,
lunches, and refreshments. Schulich Executive Education Centre’s liability is
limited to reimbursement of paid tuition fee.

Certificate in Supply Chain and Logistics Management/Program Fees:
• SCL members: $10,550 CDN + Applicable taxes
• Non-members: $10,950 CDN + Applicable taxes
• Program fee includes program tuition, teaching materials, lunches and
• It also includes a six-month membership in Canada’s leading supply chain &
logistics association – SCL Canada – for non-members who register.
• Schulich Executive Education Centre’s liability is limited to reimbursement
of paid tuition fee.

Schulich Executive Learning Centre, 4700
 Keele Street, Toronto, Ontario

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About the Author

Bruce is an entrepreneur/real estate broker/developer/coach/urban guru/keynote speaker/Sens founder/novelist/columnist/peerless husband/dad.