Business Model vs Revenue Mode

The terms “business model” and “revenue model” are often used interchangeably. I’m going to nerd about the differences for just 200 words. 🤓

Your business model describes how you provide value to your clients. Examples are:

• 1-on-1 consulting services

• Training/Facilitation

• Group Coaching

• Online courses

Your revenue model describes how you get paid for the value created for your clients.

Let’s say your business model is providing 1-on-1 services. The revenue model options include (but aren’t limited to):

• Billing hourly

• Flat fee productized service

• Value-based pricing

Or let’s use training as an example. The revenue model may be a flat day rate or a per-head rate.

You get it.

Why is this important? You need to make sure your business model and revenue model are working before you try to grow your business.

Adding more 1-on-1 services or team members or SOPs won’t fix a poor fit business model or poor fit revenue model. More likely, it will make it worse. You need to fix what’s broken before you start adding. Or, as Jessica Fearnley famously quoted on her visit to the Hourly to Exit podcast, “Scaling chaos leads to more chaos.”

Take another look at your business model and revenue model. Are they the right mix to reach your goals?

I’ve you’ve got questions about creating the IP foundation required for the scalable business model options, let’s chat. Reach out!