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Business Types

Brain dump of how I think about businesses types. Some businesses package multiple types for their offering. Businesses not need to be complex, but only need to offer value.

Content Aggregation – These businesses do not focus on creating new content, but rather collecting and aggregating. Examples include News websites, Social Media, Conferences,Blockbuster. Monetization comes from sponsors/customers paying to advertise/subscriptions.

Market Middleman – These businesses connect buyers and sellers, and don’t have “inventory”. Examples include Uber, Grub Hub, AirBNB, CASH App, EBAY, Real Estate Agents, Credit Card Companies, Advertisement Platforms, Pateron, the IRS. Franchises owners (selling the “brand name”) can roughly fall under here. Monetization comes from “taking a cut”.

Product Development – Businesses who create a product in which the product is something the buyer uses directly (software,hardware), and the product is not considered an “aggregation of data” . IDA Pro, Burp Suite, Pepsi, Slack, Clothes, Apple. Monetization comes from selling product/licenses. Perishable/limited use goods fall under here too (food, shampoo , etc.)

Service Based – Businesses who sell their time to provide value. Ex, Security Consulting, Land Scaping, Restaurants. Monetization comes from sales of services.

Investment – These businesses grow their wealth by purchasing asset which the investor speculations will go up, or charge customers interest on loans. This includes traders, real estate investments, angle investors, banks, and finance centers in car dealerships etc. Monetization works by having ownership of something, which can be sold at a later time, or getting paid interest.

Insurance – These businesses offer limited “protection” to customers. Monetization by ensuring positive inflow of cash from all customers to cover damages which may happen to any customer. (Is it legal to invest money here?)

Non Profit – Special type of “business”, which is intended to benefit humanity. Monetization can achieved through standard means (performing services/selling products), but also donations.

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