Creating the Best Lean Business Model Canvas

This is the standard template layout

1. Focused: It is focused on a narrow customer segment – ideally a customer you know and can talk to freely.
2. Clear: It doesn’t use Jargon, and is quick and easy to read.
3. Informed: It is informed by a real target customer, and not by your own assumptions.
4. True: Your value proposition and unfair advantage are validated by real customers.
5. Useful: It helps guide your team on marketing and sales decision-making.

1. Start with the “Problem” and the “Customer Segment” sections so that you can focus the rest of the canvas on these essential points.
2. Complete the “Unique Value Proposition” to appeal to your target customer, because they will know that you are what they need. Try adding a “one-liner” to describe your product too – e.g. “The LinkedIn for Charities”.
3. Summarize your “Solution” as the top 3 (max) features that achieve your Unique Value Prop, so that you use only the top features that you know to appeal to that customer
4. List the top 2 or 3 marketing channels that you know will honestly reach this customer, given steps 1-3 above.
5. Now it’s time to fill in your “Cost Structure” and “Revenue Streams“. How does this customer prefer to pay? When?
6. Now for “Metrics“: How will you measure that you are being successful with this target customer segment? 2 or 3 key metrics.
7. Finally – your “Unfair Advantage“? Think of what truly separates you from the rest, and what is defendable. Think of how you will set yourself apart when you speak with prospective customers.

The Value Prop Canvas elaborates on two key areas of the Lean Business Model Canvas.
1. The left half of the Value Prop Canvas corresponds to the “Unique Value Proposition” cell of the Lean Canvas.
2. The right half of the Value Prop Canvas corresponds to the “Customer Segment” cell of the Lean Canvas.
3. Items from the “Solution” cell in the Lean Canvas might also be included in the “Products and Services” of the Value Prop Canvas.
4. Usually the Lean Canvas is created first, and the Value Prop Canvas is created second to help focus on the Product-Market fit.

* Decide on the top 1, 2, or 3 (max) real problems that you solve for your target customer. List them clearly.
* Do not list all of your target customer’s problems.
* Use the words that your real target customer uses.
* Avoid mixing up multiple target customer segments; You must focus!

* It is best to focus on a single target customer segment for each Lean Business Canvas.
* If you have multiple segments to target, pick your top priority customer first. You can create more canvases later.
* You can list other important user groups, but focus the canvas primarily on your target buying customer.

* Craft this as a selling pitch, to excite your target customers, so that they cannot resist your product.
* Include a description (2 or 3 lines) to succinctly convey the message.
* Create a snappy “high-level concept” so that people can understand quickly. e.g. “Uber for kids” for a child-focused driving service.
* Focus on inspiring your target customer, and avoid listing features here.

* Describe how you solve the customer “Problem”.
* Use the words that best speak to this target customer.
* Avoid listing all of your features.

* You must establish the 2 or 3 metrics that will help your team optimize every single activity toward success.
* Be careful: These are the metrics that will be used for targets.
* These can be things like % of users using a particular feature in the free trial, or percentage of new users sharing your product on social media.

* This is what sets you apart from your competitors.
* It is the area where you have a defendable advantage.
* Think: “What will I tell prospective customers to show them that our product is better than the competition?”
* Ensure this is based on evidence – i.e. only use what a customer has really said to you.

* These are the top marketing and sales channels that will reach your customer.
* Choose 2 or 3 top channels, so that you can focus your team’s energy efficiently.

* This is where you list how your product generates revenue for your company.
* Include Recurring Revenue (subscriptions), Licensing revenue, Service revenue, Ad revenue, Commissions etc.
* Start with a simple model, so that it is easy to measure success and optimize.

* This is where you describe how you charge your customers or users.
* It may be a freemium model, a pay-as-you-go model, a service-charge model, a revenue-based pricing model, or other.
* If you are a startup, keep it simple, so that you can easily measure and optimize.