If you’re looking to quickly document your business idea, but don’t want to take the time to develop a complete business plan, you’ve probably come across the Business Model Canvas. The Business Model Canvas was developed to solve the two key problems with business plans—they take too long to write and are difficult to update.
However, the Business Model Canvas introduces its own problems and can often give you an incomplete picture of your business. That’s why we’ve developed a one-page business plan template. It can help you spend even less time creating a flexible, much more useful snapshot of your business roadmap.
So, which planning format should you use? Let’s explore the pros and cons of the Business Model Canvas and introduce you to the basics of the one-page plan to help you decide.
What is the Business Model Canvas?
If you’re new to the Business Model Canvas, here’s a quick definition:
The Business Model Canvas is a one-page overview of a business’s strategy and business model. It’s intended to be used by startups and founders who are trying to identify a business model that will work for their business. The Business Model Canvas is intended to provide all of the structure of a business plan, without the inconsistencies and vagaries of “back of the napkin” business idea sketches.
Here’s what the Business Model Canvas template looks like:
Pros of the Business Model Canvas
The core purpose of the Business Model Canvas is to demystify the business planning process. It removes the need for a traditional, text-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea. Here are a few key benefits that come with this template.
Visualize your plan
The structure of the Business Model Canvas ditches a linear structure in favor of a cell-based template. This is done to encourage you to build connections between every element of your business from the start. Rather than writing out disjointed expenses, value propositions, and potential customers — you work through them side-by-side and can easily reference previous sections as you develop them.
Faster to create
Now, you do have limited space to leverage with the Business Model Canvas. That’s really the point, as this is meant to be a faster and easier plan to create. Even the size of each cell is designed purposefully.
For example, the problem takes up a larger section of the page, but your solution and metrics are each half the size. This tells you, without detailed instruction, that you need to take a deep and extended dive into potential issues and explore as many current alternatives as possible. But your solution and data measurements should be streamlined and purposeful in relation to those issues that you’ve uncovered.
Documents your business model
The layout of the Business Model Canvas is also useful for you, your team, and any third parties to visualize your business model. It showcases the framework of your business and helps connect the dots between business components, without needing to have intricate knowledge. It’s a useful visual to kick off any discussions about elements of your business and an easy visual to work with during pitch or strategy discussions.
Cons of the Business Model Canvas
Unfortunately, the Business Model Canvas template doesn’t work for everyone.
As my team and I have worked with entrepreneurs over the years (and we’ve worked with thousands), we’ve consistently found that the Business Model Canvas can be difficult to understand without substantial training. It’s also difficult to read, especially for people who aren’t familiar with the format.
It’s difficult to adapt into a full business plan
There will likely come a time when you need to pitch to investors or seek out funding. At that point, lenders and investors may expect to see a traditional business plan that provides greater detail regarding the functions and financials of your business. A one-page Business Model Canvas may be beneficial to provide as an introduction to your business — but you’ll need to back it up with a full exploration of milestones, startup and operational costs, potential revenue streams, marketing activities, and financial forecasts.
By starting with a Business Model Canvas, you’ll potentially need to start over when developing a full business plan. This is due to the formatting and simplified sections of the Canvas. Yes, they are beneficial to use when exploring an idea, but difficult to expand on when actually executing them.
No room for validation
Regardless of what your business does, it’s critical that it’s solving a real problem for customers. If your products and services don’t fill a need, customers will never walk in the door. Known as validation, it’s an element that is lacking within the building block style of the Business Model Canvas.
Yes, this one-page setup helps you connect disparate pieces of your business plan, but it can also encourage you to make those connections when they don’t exist. For example, you may have outlined a problem and a few current solutions. Based on the structure of the Canvas, you work through your own solution, value proposition, and potential marketing channels. Then you start trying to tackle your customer segments and realize that you’re struggling to actually define them.
Rather than arriving at this issue earlier, and setting out to validate if your idea is attractive to anyone, you’re suddenly met with the need to find a target market that has the problem. This leads to the next issue with the Business Model Canvas.
No focus on product/market fit
The core issue is that the Business Model Canvas doesn’t focus on making sure a business is solving a real problem for their customers. People like to call this “product/market fit.” In other words, customers (the market) don’t have a reason why they need the product the business is selling.
In our experience, if a company can’t find a good product/market fit, it will almost certainly fail.
Why is the lack of product/market fit such a killer for businesses? Well, when a customer is shopping for something, they’re looking to solve a problem or fill a need. A good business offers products and services that help people solve their problems and fulfill their desires.
For example, Mailchimp helps customers easily send email newsletters. A hair salon helps people achieve the style that they’re looking for. Restaurants give people not only the kind of food they’re looking for, but a specific experience—think upscale dining, or a hip and trendy bakery.
If a business doesn’t solve a real problem for potential customers, it’s going to have a very hard time attracting customers. Just think for a moment, do you shop for things that you don’t need or want?
It’s not that a business needs to solve a completely unique problem. In fact, competition is actually a good thing. But, businesses do need to have a unique take on a customer’s problem.
Unfortunately, the Business Model Canvas doesn’t directly address product/market fit even though it’s such a critical issue.
Our solution — a one-page business plan
Instead of forcing the Business Model Canvas to solve the problem of product/market fit, we took a new approach and created an alternative to the Business Model Canvas Template. We call it a one-page business plan and it’s a core part of growth planning, a better way to plan and grow a business.
If you want to get started right away, download the one-page business plan template now. Or, read on to learn about what we changed and how to use the template.
What is a one-page business plan?
The one-page business plan format takes the best of the Business Model Canvas template and makes it easier to use and easier to read. It can be completed in under an hour and delivers three things that entrepreneurs need in their planning process:
Instead of developing a lengthy, traditional business plan, the one-page plan requires entrepreneurs to focus on the key drivers of their business and find a strategy that will truly bring success.
Anyone can start using the one-page business plan template without any training or business background. And, anyone can easily read it and understand it.
Successful planning is all about revising your ideas as you try and learn new things. The one-page business plan template is easy to update and tweak as you go.
What is in the one-page plan?
The one-page plan has 12 elements, including:
- Identity: A one-sentence overview of your business.
- Problem: What problem are you solving for your customers?
- Solution: What’s your solution to the problem? Describe your products and services here.
- Target Markets: Who are your customers?
- Competition: Who are your competitors and what alternative solutions do your customers currently buy and use?
- Sales Channels: How will you sell your products and services to your customers?
- Marketing Activities: What are the key activities or approaches that you’re going to use to reach your customers? What’s your pricing or cost structure?
- Revenue Streams: How are you going to make money?
- Expenses: What are your key expenses when you’re running your business?
- Milestones: What is your roadmap to test and start your business?
- Team: What are the key roles that you need in your business to be successful?
- Partners & Key Resources: Do you need to work with other businesses to make your business work?
Together, these elements provide a comprehensive overview of a business and its strategy. A one-page business plan focuses up-front on finding product/market fit by helping entrepreneurs identify the key problem they’re solving for their customers and how their solution fills their customers’ needs.
Here’s what it looks like:
With the one-page business plan, we kept the concept of “value proposition” because we think it’s important to have a one-line overview of what you do. This is somewhat similar to a tagline that explains what you do in as simple and concise a way as possible.
But, instead of focusing on “customer relationships,” as the Business Model Canvas does, we replaced it with sections to describe your “problem worth solving” and your “solution.” Since making sure you have a solid understanding of your customers’ needs and the problems they have is so critical to business success, including these sections as the foundation of the one-page business plan makes sense.
The one-page business plan also pairs the problem and solution boxes with sections to describe the target market and competition. These four sections together form the core of your business idea: What you’re doing, who you’re doing it for, and what the competition looks like.
How to use your one-page business plan
When you sit down to write your one-page business plan, I encourage you to move through it quickly. Try and finish your first draft in under 30 minutes. Write bullet points instead of sentences. Then take a step back and see if it makes sense.
Share your one-page business plan with key partners, friends, and family and see if it makes sense to them. If you need to make changes, it’s fast and easy since you’re just editing a single page. If you need more step-by-step guidance, we have a series of articles that will walk you through the process.
When you’ve completed your one-page business plan, you now have the building blocks for a more detailed business plan—if you need one.
At this stage, however, your one-page business plan is really just a set of assumptions—it’s your best guess at who your customers are and what they want. We’ll just call this early version of your one-page plan your “guess.”
Now, you need to go out into the world and actually talk to your potential customers and make sure your “guess” is correct—sometimes this is called idea validation. Do your potential customers have the problem or need that you think they have? What do they think of your solution? Will they be willing to pay you?
In this article on market research, I go into more detail about how to actually talk to your potential customers.
As you talk to people, come back to your one-page business plan and review and revise it. After a couple of rounds of this, you’ll have a plan for a business that has a good chance of success. It’s a good idea to get a business plan review meeting on your calendar each month, so you’re always reviewing and changing your plan as you go.
Download a one-page business plan template— a better alternative to the Business Model Canvas
You can download the one-page business plan template here for free. Project it on a whiteboard and fill it in, or just print it out and work on it from there. You can also use sticky notes to add your ideas instead of filling them in just with a pen or pencil.
Or check out LivePlan’s Pitch feature. It really is the fastest way to get started. Plus, you can share a private link to it with key stakeholders, or export it to PowerPoint to easily present it to investors or other stakeholders.