Business Models

After BYJU's raised a $300 million funding round in October 2021, the Edtech startup was valued at an astronomical $18 billion, becoming the highest valued company in the Indian tech startup ecosystem. And not just that, BYJU's also holds the title of the most valuable Edtech startup in the world and the 15th highest valued startup in the whole wide world. With a net worth of Rs 24,300 crore, Byju Raveendran and his family have become richer than Rakesh Jhunjhunwala (India's Warren Buffet), Bharti Mittal (Founder of Airtel) & Anand Mahindra (Founder of Mahindra Group). If you're thinking these...

After Intuit announced it was acquiring Mailchimp for $12 billion in September 2021, the deal sent shockwaves across the tech industry. But Salesforce had just acquired Slack a few months ago, in Dec 2020, for $27.7 billion, so Mailchimp's acquisition was by no means the largest SaaS acquisition in recent history.  Mailchimp's acquisition still became the talk of tech town because it was the largest acquisition for a non-VC-funded bootstrapped SaaS company until date. What added more credence to Mailchimp's self-funded, anti-VC approach was that the business generated a revenue of $750 million in 2020 and has been profitable throughout its entire lifespan. Aaron Levie, CEO of Box,...

In recent years, the photo and video app category has experienced runaway success, driven by the rise in consumer fascination to edit photos and videos. Photo and video apps made nearly $2billion in 2019, up from $240 million in 2016 at a compound annual growth rate of more than 100 percent. While Apps like YouTube & Tik Tok, and Twitch are a few winners anyone could guess, one app relatively lesser-known app that regularly features among the top 10 revenue makers in the photo and video app category is Picsart. In January 2020, Picsart stood fifth among the top revenue makers in...

By July 2015, almost two years into launch, Inshorts had achieved a milestone of 1M Android App Installs with a 4.5-star rating on Google Play Store, but the company was still not fretting over monetizing the product. Azhar Iqbal, CEO of Inshorts laid out the company’s strategy at a panel discussion in FICCI Frames 2016, “Inshorts currently does not make any money. We’re right now working only of venture capital money. There’s no particular revenue model. Right now, our main focus is trying to get eyeballs on Inshorts and make sure people read our summaries as they don’t have time.” So then how did Inshorts...

At the time Figma was started, in 2012, IBM employed one designer for every 72 engineers. By 2019, IBM had eight engineers to every designer, and the ratio went to 3:1 on mobile. And it wasn't just IBM that became more serious about design — the entire tech industry switched to the design-heavy product development approach. Atlassian went from 1 designer : 25 engineers in 2012 to 1 designer : 9 developers in 2017.  LinkedIn went from 1 designer : 11 engineers in 2012 to 1 designer : 8 developers in 2017.  Dropbox went from 1 designer : 10 engineers in 2012 to 1...

Companies can generally are categorized into two types: ones that look to make incremental advances in an existing industry to stay relevant in a constantly changing competitive landscape or look to turn entire industries on their head by leveraging innovation. Lemonade falls into the latter category. And the industry Lemonade is trying to disrupt is insurance. But before we get into how exactly Lemonade is different from legacy insurance players, we need to understand better how the insurance industry works. So, let's dive into it. From an insurer's point of view, insurance might be a vital tool to safeguard for rainy...

Until the first decade of the 21st century, the traditional model of raising money to start a business included either borrowing money from a bank in exchange for collateral or convincing venture capitalists your idea was worthy of investment in exchange for equity. Even though these models had their own set of pros and cons, both rested on the assumption that the business will most likely succeed, moving customer validation, if not entirely, then for the most part, to a post-launch date. However, Indiegogo's entrepreneurial crowdfunding model flips the traditional fundraising model on its head. Under the Indiegogo Model, aspiring...

The proliferation of encyclopedic information can be classified into two eras: pre-internet and post-internet. Both eras gave birth to different models to create a knowledge repository and share it with a wider audience.   The earliest encyclopedic work to have survived until modern times dates back to the 1st century AD. Still, it was only after the advent of the printing press in the 15th century that encyclopedic knowledge was democratized. Most pre-internet encyclopedias, including Britannica, the earliest and the most famous Encyclopedia in the English-speaking world, had a similar operation style and business model.  As you can guess, they ran like more or less a...

In 2016, 13 years after being in existence, Tesla made a one-word switch in its mission statement.  The old mission statement read, "Tesla's mission is to accelerate the world's transition to sustainable transport." The updated mission statement became, "Tesla's mission is to accelerate the world's transition to sustainable energy."  I highlight this change because it opens up a different window to peek into the house of Tesla. The general perception built around Tesla is that it is a car company focused on speeding up our transition to electric or sustainable transport, but the mission statement change and newer product lines indicate that...

I'm going to throw you a challenge. Assume you have to start a university that would become the richest and the most prestigious educational institutions in humankind's history.  What plan of action would you create? What business model would you choose? How would you make it financially viable for the centuries ahead? A predictable approach would be to build a sustainable brand by providing top-notch education, establishing artificial scarcity by making applicants go through a challenging selection process, and ensuring students get placed in high-income jobs. In exchange for all of this, students would be willing to pay exorbitant fees.  But that's...