Last week, Alex Osterwalder traveled to Bogotá to meet with and work alongside the entrepreneurs and mentors of Colombia’s Apps.co program. During that time, he met with PulsoSocial correspondent Aleyda Rodríguez. The two discussed the utility of the Business Model Canvas and his perception of Latin America’s entrepreneurial scene.
Image courtesy of Apps.co.
Aleyda Rodríguez: The Business Model Canvas has become a reference point for the evaluation of technology business models. How has it proven effective?
Alex Osterwalder: Firstly, it is a tool that allows for the development of a business idea in a way that is structured and simple. It simplifies things a lot, and it renders talking about products, market segmentation and marketing strategy much easier to do. It allows us to do everything through one single medium and produce a quick sketch of all of the strategies involved in a business.
Secondly, the canvas breaks down the iteration process. You may propose various alternatives surrounding the same idea and play around with them. The canvas has allowed us to understand that a startup isn’t about the product – it’s about the business model.
Today, platforms and business models are where the toughest competition resides. You have to decipher what the best value proposition for your specific segment of the market is. The canvas is a powerful tool for recognizing the best business model, not the best product.
Lastly, the canvas offers a structure for the way you think your business could work and later helps you to try it out fast. It is a starting point for testing, and it gives you a framework for understanding your market. It is very visual and very powerful, a hammer-like tool for entrepreneurs.
An entrepreneur’s work is commonly that of trial and error. But with the Business Model Canvas, we now have tools that allow us to see the entire process in a way that is structured. Yes, the trial and error element remains, but with structure and planning. Without such devices, the process would be entirely ad hoc.
AR: What other methodologies would you recommend for entrepreneurs that complement the Business Model Canvas or that are good for experimentation?
AO: The startup owner’s manual from Bob Dorf and Steve Blank is an essential complementary tool for the canvas methodology, as is The Lean Startup. These three tools together are very potent – much more so together than apart. With these methodologies that are now being developed and tested, we have started a revolution, and more is sure to come.
AR: In the methodological development of the Business Model Canvas, what phase do you think represents the biggest obstacle for entrepreneurs and why?
AO: I’ll put it like this. In the world of entrepreneurship, there are a lot of people with good ideas. However, they don’t know whether those ideas will work, or they are too arrogant to try them out. The biggest mistake an entrepreneur can make is to fall in love with his or her idea – because it looks and feels great, because the product is simply surprising. None of this means that the market or consumers will fall in love with the product as well. When you fall in love with your idea too quickly and too soon, that’s where everything can fall apart.
AR: This is your fifth time in Colombia, and you visit Latin America quite a bit. What is your opinion of the region’s entrepreneurial ecosystem? Do you think Latin America could be the next big thing?
AO: The first time I was in Colombia was five years ago, and everything, without a doubt, looks much different today. I’ve noted government entities implementing ideas and offering a structure to the entrepreneurial movement, trying to change the population’s way of thinking. I’ve spent time in Chile, Colombia and Brazil over the last few years, and I have met many young people dedicated to the field of entrepreneurship – something that I find very surprising. Many people have started to learn about the methodologies we’ve developed.
Comparing the first time I came to Colombia to what it is today, it’s obvious that something is happening. That said, I don’t like to isolate one single entrepreneurial ecosystem for evaluation, because today, the opportunities out there are global. For example, my book BMG has influenced the decision-making processes of companies and startups from around the world, and I am Swiss. In this day and age, it doesn’t matter where you’re from. Of course, more investments mean that your market is growing. In that sense, Latin America is interesting in terms of the opportunity represented by its growing middle class.
Original source, featured image.
This text has been translated by Emily Stewart