Does your business model scale?

October 14, 2020

When it comes to scaling a business nothing is more important than your business model.

What’s a business model?

According to Investopedia “the term business model refers to a company’s plan for making a profit. It identifies the products or services the business plans to sell, its identified target market, and any anticipated expenses”.

So basically, it’s how you plan to make make money.

But not every business model is created equally.

There are project-based business models, where revenue has a start and end date, like building a website or a house…

There are advertising-based business models, like Facebook and Google use to monetise the traffic they receive…

There are retail business models, where you sell products to consumers in store or online…

But my favourite (and the one I look for in every business I start or invest in) is a recurring revenue model – where you make the sale once, and keep earning revenue on a recurring basis until you lose the client.

With a recurring revenue model, all you need to do is focus on keeping every client you bring on board, and your revenue will grow each and every month and give you the stability you need to continue investing in growth and scale.

Alex Cleanthous

Director of Strategy + Innovation | Co-Founder at Webprofits

I co-founded Webprofits in 2006 with the belief that there's always a smarter and better way to do things. We're now a digital growth consultancy with offices in Australia, Singapore, and the United States. I'm passionate about personal and professional growth, and I like to surround myself with people who are as well. I have substantial private board experience, and have successfully launched an IPO.

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