Launch Businesses from Montana's Libraries

Montana Libraries SPARK:

Entrepreneurial Training in Montana's  Libraries


Montana public libraries have partnered with aMT's Rural Innovation Initiative (AMRII) to provide entrepreneurial support to aspiring small business owners in their communities. Participating libraries will receive course training on how to support early-stage entrepreneurs, and then can use the materials below to design a program that will support their patrons.

This program is part of the the Montana Libraries SPARK initiative, a state-wide initiative for public libraries to provide economic development support to Montanans across the state. Our goals for the Entrepreneurial Support in Libraries Program are that:

  • Trained libraries offer entrepreneurial support and services to their community 
  • AMRII and participating libraries help connect rural entrepreneurs across the state
  • Libraries connect with and supplement ongoing entrepreneurial support efforts in their communities

If you have any questions about this program, please contact Karl Unterschuetz at or Amelea Kim at

Training for Librarians

This course contains five self-paced modules delivered through Moodle with online discussion sessions every two weeks.

Module 1: Introduction to Entrepreneurship/Small Business

Module 2: Providing Entrepreneurial Support - GUIDES Framework and Community Assessment

Module 3: Entrepreneurial Support - Information Pathways'

Module 4: Identifying Startup and Business Types

Module 5: Putting Things Into Practice


What Does a Training Session Look like?

Learn More

Medicine Spring Library - Blackfeet Community College Pressentation

Libraries That Have Received Training So Far

  • Harlem Public Library
  • Belgrade Community Library 
  • Lewis and Clark Library - Lincoln Branch
  • Bitterroot Public Library
  • Chouteau County Library
  • Missoula Public Library
  • Lewistown Public Library
  • Madison Valley Public Library -Ennis
  • White Hall Community Library
  • Boulder Community Library
  • Flathead County Library

Learn More


Reduce Your Risk and Get Funding by Using Lean Startup Tools

A Study Guide

by Sarah Grissom

Does your idea's potential value outweigh the risk of starting a business? 

The main points of this document are to demonstrate how business models encompass a wide range of considerations when building your business plan. We will discuss the business model as the backbone of your business and its importance for beginning one. However, many successful business owners have done without this model. This information will help create perspective about the possibilities for planning an efficient plan to begin your business with lower overhead costs and an enthusiastic customer base. While we break down the elements that go into the Lean Startup Method and build out your business model, these ideas should be seen as a guide (not a requirement) in creating a plan to start your business. Hopefully, these ideas and strategies will help reduce the anxiety people experience when starting a business and demonstrate the accessibility of entrepreneurship to all people. Below, I will summarize what I believe to be most important when confronting the risks of starting a business and how to reduce them by exploring who your potential customer is. 

Firstly, business owners come from various backgrounds, education levels, and life experiences. For many, the risk of jumping into a new business can be daunting. This written content aims to determine if your idea is worth the risk, how to begin constructing a business model, and connect you with the resources needed to get your business off the ground. 

The Business Model Canvas

Throughout this document, I will explain the approaches and thought processes behind the "Lean Startup Method," the Business Model Canvas. These processes were created through years of experimentation by entrepreneurs like Eric Ries, who has found great success using the practices and methodologies in the "Lean Startup Method." According to The Lean Startup Method website, Ries' goal was to lower the risk of

starting a business by continuously testing ideas at the lowest possible cost and focusing on who your customer is to the entrepreneur. Much of this content comes from the Business Model Generation, written by Alexander Osterwalder and Yves Pigneur and brought to you by Strategyzer.

There are nine building blocks to the Business Model Canvas:

  1. Customer segments
  2. Value propositions
  3. Channels
  4. Customer relationships
  5. Revenue streams
  6. Key resources
  7. Key activities
  8. Key partnerships
  9. Cost structure

This document will discuss these building blocks and break down each category to better understand Osterwalder and Pigneur's ideas to reimagine outmoded business models. The Value Proposition Canvas focuses on the "creation of a customer." This means identifying "customer segments" (we will address these terms later in this document) and proving that your idea is viable.

The Value Proposition Canvas relies on the potential business owner's ability to create a desire or need for a product or service and communicate with others to determine blind spots or biases that you may have and could lead to the failure of your proposed idea. The Lean Startup Method urges budding business owners to think of their idea as an experiment; your idea needs to be tested until it is proven to work. For example, creating a basic version of your product or service and testing it with friends, family, or whomever you think your target market is. Starting with an underdeveloped product may sound daunting, but this gives you the flexibility to make changes as consumers begin to provide feedback on your idea. This process is called "customer discovery."

The basic version of your idea is called the "minimum viable product (MVP)" in the Lean Startup Method. It aims to spend as little money as possible upfront to make changes without dismantling the whole ship. Ultimately, the Business Model Canvas allows individuals to create business models that are innovative and specific to their markets and rival competitors. Learning this model gives an entrepreneur the flexibility to reimagine how business models are created and their strategic value over time. To do so, one must plan out their business and needs, the relationships and partnerships they must cultivate, and the cost structure and revenue they produce (Osterwalder and Pigneur 2010).

Video Resources:

“Business Model Canvas –A Guide for Beginners,” YouTube (2021), 5:38, by Nick Himo


"How to Develop a Business Idea: Crash Course Business - Entrepreneurship #2," Youtube (2019), 12:20, by CrashCourse


The Value Proposition Canvas

Suppose you have dipped your toe into the entrepreneurial pond or are just starting to investigate what it would take to start a business. In that case, you will likely run into the term "value proposition canvas." Business majors, owners, and economic development departments often point to this as a how-to for budding business owners to determine the value of their product or service for their customers. 

Value proposition asks why someone would be willing to buy your product or service instead of similar products or services. How does your idea make customers' lives easier or solve a problem they may encounter? Essentially, what is the value of your product or service for your customers? 

The Value Proposition Canvas helps you determine what product or service your business will provide. However, most importantly, it helps you identify your customers and solve their problems or enhance their desired experiences.  

Many potential business owners or innovators begin with an idea of a product or service they believe could succeed. While many will pump money into their idea upfront, the value proposition canvas will demonstrate the importance of starting with whom the customers are rather than marketing or producing the product or service itself.  

The goal of a business is to make money, so you must create or identify a customer and figure out how to keep them. So, while money seems like the logical first step to starting a business, aligning your business with a very interested customer is more important. This can be done by identifying "customer jobs" and how your idea makes them more accessible or better (Osterwalder and Pigneur 2010, 22-23).  

Customer Jobs refer to what customers are trying to get done; for consumers, this can vary from traveling from one place to another, feeding or cleaning ourselves, etc. It is essentially the things that businesses and consumers are trying to get done daily (Bossy, "Value Proposition: Customer Jobs.").

Customer pains refer to the obstacles a consumer may face when attempting to get a job done. For example, customers have many options if they want to travel. Say they have decided to travel by train, but their choices do not meet their needs or wants (e.g., high prices, customer service issues, time and resources, etc.). The market responded to this pain by creating options that avoid these hassles, such as low-cost airlines like Spirit. As a result, customers may pay the same amount but bypass the inconvenience of time and resources from point A to point B (Josefine Campbell, "Value Proposition Canvas by Executive Coach, Josefine Campbell.").

Customer gains apply to customers with particular needs or skill sets that allow them to have options when determining what service or product to buy. This could range from a specific experience or ambiance they are looking for in terms of travel or accommodation they wish to have. In this way, the customer seeks to enhance their experience with a product or service. Rather than relieving an annoyance of a customer, you are offering a product or service that enhances or reimagines a product or service that already exists (Josefine Campbell, "Value Proposition Canvas by Executive Coach, Josefine Campbell").

Video Resources:

“Value Proposition and Customer Segments: Crash Course Business – Entrepreneurship # 3,” YouTube (2019), 12:02, by CrashCourse


This diagram helps determine what kind of business you are starting; let's begin by defining some of the terms used. 

Gain creators: are products or services that enhance a customer's experience or make customer jobs easier (Bossy, "Value Proposition Canvas: Customer Gains.").

Pain relievers: are products or services aimed at customer pains. Customer pains refer to barriers, annoyances, or frustrations customers face with an existing product or service. Pain relievers are ideas that eliminate or alleviate these customer complaints, obstacles, or frustrations (Bossy, "Value Proposition Canvas: Pain Relievers.")

Identifying what kind of idea you have and the customer jobs you are targeting will make it easier to identify potential markets or customer groups. 

If you are struggling to identify whether your product is a pain reliever or gain creator, begin by determining how you came up with the idea:  

Did your idea stem from a passion or something you often do or consider yourself an expert at? Your concept may stem from an annoyance or complaint that could be solved by a product or service that does not exist. Lastly, a product or service already exists, but you believe you can do it better or enhance it somehow. 

These scenarios prompt a person to fill these "gaps" in the market by starting a business.

Customer Segments

Customer segments can be challenging to nail down and are often tied to your value proposition. Customer segments come down to the question, "Who is your market?" Ultimately, you want to consider who would be willing to spend money on your product or service. To identify its segments, a company must group customers based on everyday needs, expected behaviors, and customer desires. Your Value Proposition will point to the potential success of your idea. Still, most importantly, it is a great way to start creating a customer.

The idea of "creating a customer" is integral to the success of your business because it narrows down the audience that will most likely buy your product and continue to buy it. However, this all depends on the type of product or service you are selling; it is essential to understand the branding of your product and whom you believe it will serve. While you may know who that market is, whether it concerns price, quality, or branding, it is vital to consider the variety of people drawn to your business. 

Consider what you want or anticipate your customer's experience to be. For example, if you are considering opening a Mainstreet business, you may expect to be serving local patrons; however, there may be more than just the local customers drawn to this type of business. Therefore, building relationships and discovering your returning customers is a high priority when establishing a reliable base for your patrons. 

Coffee is an excellent example of customer experience. There are several options for buying coffee: at a gas station, convenience store, coffee shop, drive-throughs, etc. However, all these options provide some customer experience. When you create your customer, you want to consider the experience your perceived target market is looking for. For example, while some customers may value accessibility and cost, it makes sense that gas stations or drive-throughs may be the experience that suits them best. On the other hand, if your customer is looking for a sit-down experience (e.g., time to work, meeting with friends or colleagues, etc.), they will be more likely to choose a coffee shop because it has a particular ambiance and service that fits their lifestyle and habits. 



Ultimately, the process of identifying your customer segments is called customer discovery. Customer discovery involves many techniques when "creating your customer" (identifying your customers and your markets). This goes back to the earlier ideas of the Lean Startup Method, which emphasizes the importance of heavy market research. Having a well-researched customer base will enhance the potential value of your business.

customer segments part2

customer segments edited part2-1

Most importantly, customer discovery allows you to confront the assumptions that you may have about your customers; an Analysis of 101 Startup Postmortems (2021) showed that 42% of businesses fail due to no demand for their product/or service (CBInsights, "The Top 10 Reasons Startups Fail."). Customer discovery confronts this statistic by encouraging earlier-stage business owners to invest their time testing their ideas on actual people (i.e., friends, family, coworkers, people you meet on the street, etc.) (Osterwalder and Pigneur 2010, 20-21). 



Channels are a building block that helps you determine how to reach the customer segments you have identified. Channels can serve your business by creating awareness about your business, allowing customers to evaluate the value of your product, how and where to purchase your product and/or service, how to deliver it, and how to support your customer post-purchase. When exploring channel options, one must decide whether to own or have partner channels. Owned channels sell directly to your customers via a website, storefront, etc. Indirect channels also fall under-owned channels because they partner with retail partners who sell and promote your product or service.

The pro of owned channels is that there are larger profit margins because you do not need to account for the extra costs of selling through other retailers who cut your profits for their services. However, partner channels can be beneficial because they can lower the marketing cost and, depending on your product, shipping, and packaging costs (e.g., Amazon). Partner channels can reach larger customer bases, making your product more accessible and profitable. Owned channels are more practical for locally-based businesses consistently delivering products and services. 

Video Resources:

“Business Model Canvas Channels- How to Build a Startup,” YouTube (2015), 0:50, by Udacity


“Business Model Canvas Channels Example - Part 4.1,” YouTube (2018), 13:42, by SideStartupClub


Channel Phases:

Awareness: how do you elevate awareness (i.e., recognizable brand) of your product/service?

Evaluation: how do you demonstrate the value of your product/service?

Purchase: how do you allow your customers to buy specific products/services?

Delivery: how do you deliver the value your customers expect?

After Sales: how do you support your customers once they purchase your product/service?

Determining which channels are best for your business depends on the scope. The scope of your business is how many customer segments and locations you want your business to reach. However, you do not have to choose owned or partner channels. Instead, considering the channels you want to use is a flexible process that allows the entrepreneur to find a balance between both channels to maximize their sales and customer reach (Osterwalder and Pigneur 2010, 26-27).

Customer Relationships

Customer relationships are a way of establishing what relationships you want to cultivate with each customer segment, personal or automated. Determining one's customer relationships comes down to the motivations of building your relationships. Businesses typically are motivated to create relationships to acquire customers, retain customers, and increase sales. An example may be acquisition techniques like providing potential customers with low-cost or free products/services. Once customers use the product or service, businesses move on to retaining those customers through building relationships and trust. Finally, by making these relationships, businesses can focus on increasing sales from those customer segments (a.k.a. upselling). 

There are several relationships that your business can build:

Personal assistance: this type of relationship is rooted in human interaction; in this case, the customer communicates with a customer service representative. These interactions can occur before purchase or post-purchase in-store, via email, or through a call center.

Dedicated personal assistance: this relationship is more intimate, assigns a specific representative to a client, and develops over time. The best example is bankers or brokers with personal and close relationships with wealthy or essential clients. 

Self-service: This relationship does not rely on personal relationships but instead gives the customers the means to help themselves. 


Video Resources:

“BMC Customer Relationships – How to Build a Startup,” YouTube (2015), 1:04, by Udacity


Automated services: This is a more advanced form of relationship which relies on automated self-service. At their best, these relationships can provide customized services to their customers and learn the purchasing patterns to deliver personalized suggestions for other purchases (i.e., cookies). 

Communities: In some cases, businesses will create online communities for their customers to interact with and exchange knowledge and issues that may arise with products or services. Through this avenue, businesses can gain feedback on their products and services and improve them.

Co-creation: This relationship is relatively new, allowing customers to post feedback about products or services, such as reviews from customers who have purchased the product/service. Other businesses engage customers by creating new and innovative products/services (e.g., Apple's forums for customers to discuss issues and/or ways to improve a product). At the same time, companies like YouTube rely on customers to create their content for consumers.


“Customer Relationships Business Model Canvas – Using Startup Example Part 3.1,” YouTube (2018), 10:21, by SideStartupClub


This section, ultimately, pushes you to consider how you want to interact with your customers. It also allows you to think about how you want to engage with your customers and how you want to maintain those relationships.  (Osterwalder and Pigneur 2010, 28-29).  

Revenue Streams

The revenue streams you generate, or the income needed for costs associated with your business, are fundamental in getting your business moving. Therefore, after considering and experimenting with your business idea, you must seriously explore which customer segments will pay (and how much) for your product or service. There are two forms of revenue streams: one-time purchasers and second ongoing revenue streams through subscriptions, membership fees, and the value proposition of post-consumer support. 

This leads us to discuss pricing; Think about these questions: what are your customers willing to pay? What are they currently paying for a similar product or service, and what would they ideally like to pay? How does your idea provide more value than those other products or services? These questions directly link to who your customer segments are and understand their wants. Cost is a large part of driving one's value proposition because it can persuade customers to switch their buying habits to incorporate your products. Another critical element is understanding how your revenue streams contribute to your business's overall revenue. 

There are many ways to develop revenue streams for your business:

Asset sales: The most well-known revenue stream is selling a physical product. Companies like Forever 21 sell clothes, accessories, shoes, etc. Honda sells cars that customers can buy, sell, etc. These companies produce revenue by selling these products.

Usage fees: This revenue stream is based on the frequency or amount of a customer's service needs. Hotels charge customers each day they stay in a room, while psychics may charge customers a flat rate per minute for using their service. Additionally, usage fees may include services like shipping and the costs of delivering those products.



Subscription fees: This recurring revenue is based on ongoing services, and customers continuously pay to maintain access to your service. Services such as Spotify rely on a monthly subscription fee of $10 for customers to have unlimited access to their music library. While they also provide a free version of their service, it is limited in the music they can play and in what order. The value of Spotify's subscription is bypassing the limitations of the free version so that customers can create customized playlists and queues.

Lending/Renting/Leasing: This revenue stream is something most people will encounter in their lifetime. Owners of assets may lease, rent, or lend owned assets to an individual or group that pays for a fixed period. This allows the owners of the assets to bring in revenue continuously and benefits the customer who may need the means or want to own the product businesses are selling. 

Licensing: This revenue generation relies on licensing intellectual property and copyrighted materials. This benefits the owner because they do not depend on producing or advertising their products but rather allow permission for customers to utilize their property. This recurring revenue stream is most common in the media, literary, and academic industries, protecting its informational or intellectual property (e.g., music, written content, or research). 

Video Resources:

“Sales, Revenue and the Business Model Canvas:” YouTube (2018), 25:34, by Denis Oakley & Co


Key Resources

Key Resources allow businesses to deliver their value proposition by reaching their markets, maintaining customer relationships, and ultimately accumulating revenue. A business's resources must depend entirely on the business model that you create for your business. The resources you need to maintain and build your business are significant without getting into the weeds about your business model. First, you must realize what your business relies on, such as customer relationships, distribution channels, revenue streams, etc.  

Listed below are the key resources to consider when running/beginning to run your business:

Physical: This category encompasses the physical assets you may need to run your business, such as manufacturing equipment, automobiles, and transportation of resources, buildings, and distribution networks. For example, large department stores rely on physical products and need resources such as manufacturing facilities and equipment, creating networks to market and distribute their products. Fast fashion, like Shien, pay for clothes that are mass-produced at off-site facilities (manufacturing), other resources to ship their products internationally (distribution and transportation), and a central location for their offices where they run the business and coordinate these resources (building). 

Intellectual: Intellectual resources refer to brands, ownership of knowledge, patents, copyrights, partnerships, and customer databases and are integral to running a successful business. Some companies use their branding as a key resource; for example, Nike's collaboration with Michael Jordan combined Nike's semi-recognizable brand in the 80s and 90s with Michael Jordan's brand to promote and expand their market and value proposition. Technology companies like Tesla own intellectual rights to the software used in their cars, as Apple or Microsoft do with their computers and phones. Other companies who produce innovative products, like renewable energy, may patent their product to prevent identical products from popping up in the market and creating a competitive landscape.

Human: All business requires human resources; pharmaceutical companies and even skincare companies rely on human resources with expansive knowledge of the product or service to help customers and address questions or concerns. Their business model typically relies heavily on this resource, and is invaluable. Similarly, these businesses also commit time and resources to maintain other human resources, such as scientists and professionals who focus on creating a product. 


Video Resources:

“Key Resources and the Business Model Canvas,” YouTube (2018), 7:54, by Denis Oakley & Co


Key resources help you consider the resources you may need to acquire to get your product or service out the door. That being said, if your business functions online primarily, you may not need as many resources, especially if you are shipping yourself. Still, it would help if you considered things like the Post Office as a resource. In addition, you may need physical resources such as postage and packaging or other delivery mechanisms like FedEx or UPS. Furthermore, you may need to bring on other people (depending on the quantity you sell) to help package, organize, or deliver your products. Lastly, consider intellectual resources to create something unique or innovative. As you can see, key resources apply to all types of businesses, and most businesses rely on resources to deliver value to their customers (Osterwalder and Pigneur 2010, 34-35).

Key Activities

Key activities are just as it sounds; they are the activities a business must do to operate, offer its value proposition, maintain/create customer relationships, and generate revenue. Your business's actions may vary depending on the type of business you're developing. For example, an artist's main activities are producing unique art pieces. At the same time, a tech manufacturing startup, like Addman Engineering, may focus on manufacturing products for other companies/brands. Suppose your company is in advertising or consulting. In that case, your key activities may be producing content for brands or problem-solving for outside companies.  

Production: the key activities of the manufacturing business are to produce and deliver products to distribute to customers consistently. Typically, these business models offer quick shipment and high-quality products as value propositions.

Problem-solving: These activities rely on humans to respond to customer problems or barriers. Consulting firms, the service industry, and even hospitals' major activities revolve around "knowledge management" and continuously training people to reassess issues and produce alternative solutions. In addition, streamlining the efficiency of operations for a business helps to keep the business running smoothly.

Platform/Network: These key activities relate to platform management, setting up a service and the data that comes from it, and promoting platforms. The creation of networks, brands, and software can be platforms that a company maintains as part of its business model. The best example of this would be Microsoft, whose responsibility is to manage the software they create with the Windows operating systems used by its customers. Therefore, both the software and the use of Windows by the customer are platforms that need to be maintained as part of Microsoft's key activities. The development of networks is also integral to this activity because companies and businesses need to keep the connections between customers, merchants, and banks. An example is Amazon, which needs to continuously maintain its platform (the website), manage its suppliers, and get products into customers' hands as quickly as possible.



Video Resources:

“Key Activities Business Model Canvas- Applied to Startup Example- Part 5.1:” YouTube (2018), 10:50, by SideStartupClub


You must do the activities to get and keep your business running. Managing a platform to promote or sell your products is essential to get the brand you have created around your business. At the same time, problem-solving may be integral to figuring out issues you may run into. The production of your product or service is self-explanatory because you will need to create or manage your products for your business. These activities are specific to your business type and may apply to your business. Even if they do not, they may eventually, so it is vital to keep them in mind (Osterwalder and Pigneur 2010, 36-37).

Key Partnerships

This section addresses the partnerships you must create to make your business model work. This includes suppliers and other entities that help build your product or keep your service running smoothly. Partnerships are beneficial because they can increase your business model's efficiency, lower risks, and collect resources. Four types of partnerships can aid in optimizing your business; you can create a relationship with a non-competitor, build strategic relationships with your competitors, partner on joint projects to develop or expand your business, and, finally, a strong relationship between the buyer and supplier to secure consistent resources. 

There are several motivations for creating these partnerships; they are listed below:

Optimization and economy of scale: This motivation is to secure a buyer-supplier relationship that can enhance the productivity of your business. Most businesses can only own some of their resources and create in-house products and services. To lower costs and minimize workload to avoid overwhelming the business with extra activities that can be outsourced. These types of partnerships help with scaling (scaling: how large your business grows or the act of expanding your business outward) your business once it is on its feet.

Reduction of risk and uncertainty: In this instance, partnerships may be formed between businesses in similar industries to develop new and innovative products. Though competitors, it may be advantageous for businesses to partner to create new products with serious risks. For example, Blu-ray DVDs were developed through a joint venture between companies in technology. However, while collaborating, each company continued competing to sell the product.

Acquisition of particular resources and activities: Outsourcing activities and resources are favorable for businesses with limited capacity (i.e., cannot produce or manage all aspects of the business in-house). Creating partnerships may motivate a business to seek knowledge, license, or legal services. For example, a clothing store may send designs to a manufacturer to be produced, and they may solidify this relationship through a legal counsel to draw up contracts. Another example is utilizing a marketing firm to manage social media and online promotions (Osterwalder and Pigneur 2010, 38-39).


Video Resources:

“Key Partners Business Startup Canvas- Startup Example- Part 7.1:” YouTube (2018), 9:03, by SideStartupClub


Partnerships can be important for businesses that produce many products or provide many services; however, if you need to improve in these areas or keep up with the demand for your product or services, you are providing. Building these partnerships can benefit you in the long run and create long-lasting relationships if you change or alter your business (Osterwalder and Pigneur 2010, 38-39). 

Cost Structure

The costs associated with enhancing your value proposition, building and maintaining relationships, and creating revenue provoke costs. These costs can be determined by looking at your business's key resources, key activities, and key partnerships. Businesses that rely on cost for their value proposition rely on low prices to drive business. 

Minimizing costs is a priority for many businesses, but two types of businesses influence businesses' cost structure. Some businesses are cost-driven (i.e., guaranteed low prices), and those are value-driven (rely on high quality or new or inventive products/services). These two extremes create a spectrum that many businesses fall in the middle of. 

I will define the types of costs that you will run into when creating your business:

Cost-driven: These businesses rely on the lowest possible cost structure to create a value proposition for their customers. Companies like Spirit Airlines and Ryanair Air base their business model on automating services and utilizing key partnerships to manage their activities. These products and services are considered cost-driven because they create slimmer business models to spend as little money as possible while delivering a product/service. 

Value-driven: These business models are less concerned with low costs but emphasize delivering a high value to customers. Services like luxury hotels and salons provide various high-quality services exclusive to the customer and create value that relies on personalized service. 

Cost structures share the defining characteristics:

Fixed costs: Refers to a business that maintains a special price regardless of the product or quantity. An example of this includes rentals, payments to employees, and manufacturing. Manufacturers are often defined by their reliability and continuity of fixed costs. 

Variable costs: Depend on the proportion and volume of the products or services provided. Music festivals and events must anticipate varied costs associated with their services, such as vendors, management of events, security, etc. Therefore, they must utilize a variable cost model because they rely on tickets sold to customers and the volume of services and products to accommodate their customers. 

Economies of scale: These businesses rely on the number of products/services they sell. They are defined by purchasing their products at lower bulk rates and generating revenue as their sales increase. This results in the average cost of the product/service falling as sales increase. Economies of scale are advantageous for bigger companies with high demand, and prices must remain low.  

Economies of scope: This characteristic is best suited for large companies with an extensive range of operations. In this instance, a company may streamline its costs by using marketing or distribution channels to deliver a variety of value propositions to its customers. 


Video Resources:

“Business Model Canvas Cost Structure:” YouTube (2020), 6:25, by StartupSOS


This section can be challenging to digest, especially when starting your business. You may only be able to determine if your business is cost-driven or value-driven once you begin operating your business. In many ways, your business could encompass both models. Feel free to avoid being nailed down to either one exclusively. Additionally, the cost structure and costs you must consider when running your business are essential to start creating revenue. Again, you may need help determining what types of costs or economies your product or service is needed at the beginning. Still, these models may serve you best once your business is in the marketplace (Osterwalder and Pigneur 2010, 40-41).


To summarize, the Value Proposition Canvas helps determine what value your product or service gives to your customer. It begs why someone would buy your product instead of another. Finding the answer is best realized by breaking them into two categories. First, pains and gains are significant considerations when determining your product or service's value to your customer. Suppose your product or service fixes the pains your customer experiences; it is a pain reliever. Products or services that relieve these pains will point you toward whom your product can serve. Understanding your customers' barriers makes you aware of the marketplace's customer segments. The variety of your customers may change or surprise you. However, solving a customer's pains and figuring out who they are will demonstrate how you should market your product or service. Creating a product or service that makes an existing product or service better or a different type of experience is called gain creators because they enhance the customer's experience and add value to their wants and needs. 



Customer segments help recognize the variety and crossover your product or service can become in the marketplace. Businesses focused locally may serve local patrons consistently and have the potential for one-time sales from tourists. While your business may be focused locally, it is essential to recognize there are customer groups that you may not necessarily be marketing to or continuously serving. However, recognizing the importance of no one type of customer who will purchase your product or service can influence how you market your product. The example of Target and Louis Vuitton, while the companies' market to customers drastically differs, they may serve a section of the same customers. All this is to say, do not limit your product or service to one type of customer. Instead, recognize the benefit of having a diverse customer base even if there are only one-time or returning customers. You may be surprised by who engages with your business, but that complexity makes businesses successful.  

Ultimately, starting a business looks different for everyone. Still, it is essential to consider who your customers are or will be. Peter F. Drucker said, "The purpose of business is to create and keep a customer" (Drucker 1954, 37). Understanding what type of product or service you are offering (i.e., solving a problem or enhancing something that already exists) will point you in the direction of how well your business does and who will use it. Considering other factors, such as the activities that need to take place, the partnerships you need to make, and the resources you need to acquire, are crucial to running your business and keeping your customers. As noted above, many options and considerations exist on how businesses can be run and how to keep them running once established. More importantly, visualize what you want your business to be and how to get people to see your value.


Aydin, Rebecca, “How 3 guys turned renting air mattresses in their apartment into a $31 billion company, Airbnb,” Insider. September 20, 2019.

Bossy, “Value Proposition: Customer Jobs,” YouTube Video, 4:51, January 9, 2020.

Bossy, “Value Proposition Canvas: Customer Gains,” YouTube Video, 3:21, January 23, 2020.

Bossy, “Value Proposition Canvas: Pain Relievers,” YouTube Video, 2:47, February 27, 2020.

CrashCourse, “How to Build Customer Relationships: Crash Course Entrepreneurship,” YouTube Video, 10:43, October 16, 2019.

CrashCourse, "How to Develop a Business Idea: Crash Course Business - Entrepreneurship #2," YouTube Video, 12:20, August 21, 2019.

CrashCourse, “Value Proposition and Customer Segments: Crash Course Business -Entrepreneurship # 3,” YouTube Video, 12:02, August 28, 2019.

Denis Oakley & Co, “Sales, Revenue and the Business Model Canvas,” YouTube Video, 25:34, February 9, 2018.

Drucker, F. Peter. 1954. The Practice of Management. 1st ed. New York, NY: Harper & Row.

Josefine Campbell, “Value Proposition Canvas by Executive Coach, Josefine Campbell,” YouTube Video, 4:44, May 9, 2017.

Keycafe, “The History of Airbnb,” Medium. May 22, 2019.

Millward, David, “How Planet Fitness Founder Chris Rondeau Created the Fastest Growing Gym Chain in the US,” Planet Fitness. June 3, 2018.


Nick Himo, “Business Model Canvas – A Guide for Beginners,” YouTube Video, 5:38, June 6, 2021.

Osterwalder, Alexander and Pigneur, Yves. 2010. Business Model Generation: A Handbook for Visionaries, and Challengers (The Strategyzer Series). Hoboken, NJ: Wiley.

“The Top 10 Reasons Startups Fail,” CBInsights. August 3, 2021.

SideStartupClub, “Business Model Canvas Channels Example - Part 4.1,” YouTube Video, 13:42, January 9, 2018.

SideStartupClub, “Customer Relationships Business Model Canvas – Using Startup Example Part 3.1,” YouTube Video, 10:21, January 11, 2018.

SideStartupClub , “Key Activities Business Model Canvas- Applied to Startup Example- Part 5.1:” YouTube Video, 10:50, January 11, 2018.

SideStartupClub, “Key Partners Business Startup Canvas- Startup Example- Part 7.1,” YouTube Video, 9:03, January 11, 2018.

StartupSOS, “Business Model Canvas Cost Structure,” YouTube Video, 6:25, January 3, 2020.

Udacity, “BMC Customer Relationships – How to Build a Startup,” YouTube Video, 1:04, February 23, 2015.

Udacity, “Business Model Canvas Channels- How to Build a Startup,” YouTube Video, 0:50, February 23, 2015.


Our Funding:

Program Funded Through the U.S. Economic Development Administration (EDA), University Center Program following a successful application in response to their 2018 NOFO.

The University Center (UC) program is specifically designed to marshal the resource located within colleges and universities to support regional economic development strategies in regions of chronic and acute economic distress. As the EDA notes, "Institutions of higher education have extensive resource, including specialized research, outreach, technology transfer, and commercialization capabilities, as well as recognized faculty expertise and sophisticated laboratories.