The FinLab Toolkit

STRATEGY, INNOVATION & IMPACT | VISION BUILDING

Startup Canvas

90-120 Min

Go To Tool

The Startup Canvas summarises the most important elements of an organisation's business model, and is especially useful for early stage startups to think through the different elements. The version of the canvas being used here is inspired by the Lean methodology version of the Business Model Canvas (BMC).

USE CASES

  • Investigate and map how ideas or solutions could be transformed into a holistic business model.
  • Map current business models, identify gaps and opportunities (priorities), and outline interdependencies.
  • Use the canvas as a dashboard to document each stage of evolution of the business model, and reflect on investments and results.

LIMITATIONS

The Startup Canvas tool is not a problem solving tool as such. It has limited capacity to answer what the ‘right’ model for a business is. It is best used as an evolving summary or dashboard.

Lean Canvas | Railsware

UNDERSTANDING THE TOOL

  • The ‘Problem’ section is to be used to highlight the core problems that users face, and that the startup is attempting to solve (through its product or service). These are not problems that the startup is facing as an organisation.
  • Use ‘Customer Segments’ to identify the specific profile of users by whom the problem is most acutely felt. Profiles can be very specific, and may be quantised in terms of segments/market size (if data is available).
  • ‘Solution’ is how the startup plans to address the problem. It could be a product, service, system or a combination of them.
  • ‘Unfair Advantage’ is the distinct, hard to copy, competitive advantage the startup enjoys.
  • ‘Unique Value Proposition’ is the core compelling message for the user that communicates the value the startup is creating for them.
  • ‘Channels’ are the ways in which the user will interact with the solution - the way users will become aware of the solution, experience it for the first time, purchase, and continue to use.
  • ‘Key Metrics’ are measures of the business's success in reaching and serving the user. This includes things like impressions, queries, sign ups, transactions, value of transactions, renewals, etc.
  • ‘Cost Structure’ is the way costs are distributed between fixed and variable costs, and capital investments.
  • ‘Revenue Streams’ are the ways in which revenue is generated - examples could be one time payments, subscription charges, loyalty fees, tiered pricing, etc.

STEP BY STEP

  1. Familiarise yourself: Read through the various boxes in the Startup Canvas. You'll notice the columns on the left have to do with internal activity, and the ones to the right, refer to external forces.
  2. Get started: As a business, what do you have most clarity on? Is it your understanding of your customer segment or of the needs you are addressing through your business? Start with the side of the canvas you think you know better.
  3. Complete: Go through each box and fill out as much as you can. It is completely fine not to know the answer to specific areas in the first go.
  4. Identify knowledge gaps and priorities: Once the worksheet is completed to the best of your knowledge, jot down the knowledge gaps and priorities under each section. These could be issues, opportunities, or just lack of information about a particular area.

HOW TO FOR FACILITATORS

  1. At the start: Make sure the participants understand the goal of the activity and the direction. Refer to facilitation questions if they are feeling stuck.
  2. During the exercise: Start with participants’ existing knowledge of their business to create a first version of the model. Encourage participants to highlight any component they don't know the answer to, for discussion later.
  3. At the close: Have participants walk you through their completed canvases, and probe them on the core strengths and weaknesses they would like to build upon.

FACILITATORS QUESTION BANK

  • Which part of the business do you have the best view on? What are you least informed on?
  • Is there anything in here you would like to understand better? Eg. customer segment, value proposition, etc.
  • Do you expect your fundamental model and this canvas to change in the next 6 months?
  • Can you think of any other things you would like to add to this canvas? Are there any links between boxes called out?
  • What are your company's goals in the next 3-6-12 months? Are you considering them as you map your priorities?
  • How do you know something is a priority? Is there agreement within your team that these are the top priorities? Is there some assumption involved?
  • Do your priorities depend on each other? Are there 1-2 core priorities at the root of all the different challenges you might be facing?

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