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Business Model Archetypes

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Subscription Model

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A business model where customers pay a recurring price at regular intervals to access a product or service. Examples: Netflix, Spotify, Adobe Creative Cloud.

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Freemium Model

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A business model where basic services are provided free of charge, but more advanced features must be paid for. Examples: LinkedIn, Dropbox, Skype.

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Advertising Model

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A business model where services are offered free to users, and revenue is generated through advertising. Examples: Google, Facebook, YouTube.

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E-Commerce Model

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A business model where products or services are sold directly to consumers online. Examples: Amazon, Alibaba, eBay.

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Affiliate Marketing Model

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A model where a company pays third-parties to generate leads or sales for the company's products and services. Examples: Amazon Associates, ClickBank, ShareASale.

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Direct Sales Model

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A business model where products are sold directly to consumers, bypassing any intermediaries. Examples: Tupperware, Avon, Amway.

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Razor and Blades Model

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A business model where a company sells a durable primary product at a low cost and recoups profits through repeat sales of required consumable parts. Examples: Gillette, Keurig, HP printers.

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Pay-Per-Use Model

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A model where customers pay only for the amount of service or product they use. Examples: Electricity companies, Mobile phone carriers, Cloud services like AWS.

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Brokerage Model

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A business model where a company acts as an intermediary between two or more parties to facilitate a transaction for a fee. Examples: Real estate agents, Stock brokers, Travel agencies.

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Franchise Model

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A system where a business owner licenses its operations—along with its products, branding, and knowledge—in exchange for a franchise fee. Examples: McDonald's, Subway, 7-Eleven.

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Crowdsourcing Model

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Where companies leverage the collective intelligence or skills of a crowd to solve problems, create content, or develop new technologies. Examples: Wikipedia, Kickstarter, Threadless.

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Low-Cost Carrier Model

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An airline business model focused on low operational costs and low fares by eliminating unnecessary services. Examples: Southwest Airlines, Ryanair, EasyJet.

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High Touch Model

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A business model where personalized customer service and interaction is emphasized. Examples: Luxury hotels, Bespoke tailoring, High-end restaurants.

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Bait and Hook Model

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Similar to the Razor and Blades model; offers a basic product at a lower price, while recurrent sales of associated products or services generate revenue. Examples: Inkjet printers, Video game consoles, Coffee machines.

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Hidden Revenue Model

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A model where the true cost of a product or service isn't borne by the customer, but by a third party. Examples: Free credit reports, Free radio broadcasts, Social media platforms.

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Data Sales Model

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A business model where a company's revenue is primarily generated from the sale of data it collects. Examples: Acxiom, Experian, Nielsen.

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Peer-to-Peer Model

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A decentralized model focused on the direct exchange of goods or services between individuals without a middleman. Examples: Airbnb, Uber, eBay (auctions).

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Cooperative Model

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A model where a business is owned and operated for the benefit of its members, who use its services. Examples: Credit unions, Agriculture cooperatives, REI (outdoor equipment).

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Experience Selling Model

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A business model that focuses on creating an exceptional experience around a service or product to justify a premium. Examples: Apple stores, Disney theme parks, Starbucks.

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Long Tail Model

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Business model that focuses on selling a large number of unique items with relatively small quantities sold of each (the 'long tail'). Examples: Netflix, Amazon (books), iTunes.

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Open Source Model

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A model focused on developing products whose source code is made freely available to anyone, with revenue typically through support and services. Examples: Red Hat, MySQL, Ubuntu.

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On-Demand Model

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A model that leverages technology to provide goods and services at the precise moment they are needed. Examples: Uber, Postmates, Airbnb.

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Social Entrepreneurship Model

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Where the primary purpose of the business is to address social problems, often reinvesting profits back into the mission. Examples: TOMS Shoes, Warby Parker, Patagonia.

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Reverse Auction Model

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A type of auction in which the roles of buyer and seller are reversed, with the seller seeking to fulfill a service or supply goods at the lowest price. Examples: Priceline, Unique bid auctions, Government contracts.

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Marketplace Model

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An online platform that connects buyers and sellers, facilitating transactions between them. Examples: eBay, Etsy, Amazon (as a platform).

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