2. The Business Model Concept

The success of the company examples provided in this book is not primarily based on a new product, service or technology, but on a pioneering business model. But what is in fact a business model? To illustrate this, the book interprets business models as the way in which companies create and capture value, that is, the way in which the value proposition takes shape and is subsequently monetized. Certainly, a company’s business model design depends on its distinct characteristics and market positioning. While each company shapes its very own, individual business model, what all companies have in common is that each business model functions due to the interdependencies among its elements. To show this, the next chapters are built following a uniform logic, each first introducing the competitive landscape at the time when the portrayed company entered the market. This is complemented by highlighting unmet customer demands of the time—the demands, which the pioneer managed to address in an unprecedented manner. As well, a look is given at the founder (or founders), in order to counterpart the market perspective by a view on the leading figures behind the pioneering companies. Next, each business model is analyzed following the approach provided by Osterwalder and Pigneur (Business model generation. Hoboken, NJ: Wiley, 2010), and the most meaningful developments are individually illustrated on a time-line. Finally, the current market outlook is sketched, considering its positive and negative implications.