Inshorts Business Model Case Study

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...

Figma Business Model: How Figma Makes Money

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...

Lemonade Business Model Case Study

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...

Year-Over-Year [ Definition, Example, Pros & Cons ]

Let's suppose that Company A reported revenue of $50000 in 2020 and $25000 in 2019.  To calculate year-on-year growth, one would have to use the following formula: In the case of 'Company A' example, we would substitute the following values in the formula: As per the calculation, Company A had a year-on-year growth of 100%. As you must have figured out by now, year-over-year analysis entails comparing the performance of one period with the same period. The period comparison made during the Year-over-Year analysis could be annual, quarterly, or monthly. In most cases, year-on-year analysis is used to assess the financial performance of...

Interest Coverage Ratio

The interest coverage ratio is a quantity that is used to evaluate the financial health of a company. It is calculated by dividing the earnings of a company (before interest and taxes) by the amount of interest the company is required to pay over a fixed time period. It can be calculated using the formula, text{Interest Coverage Ratio}= frac{text{Earnings before interest and taxes(EBIT)}}{text{Amount of interest to be paid by the company}} We can calculate the EBIT of a company by subtracting the expenditure of the company from the total revenue. The interest coverage ratio is also known as the Times Interest Earned ratio...

What are Barriers to Exit & Types of Barriers to Exit

Let's suppose that an airline has been incurring recurring losses and wants to shut shop to avoid further losses. However, the airline owes a considerable amount of debt to its investors, using whose money the airline purchased airplanes in the first place.  Scraping the airplanes would not give enough return on their original value. Another airline looking to amp up its fleet numbers would be ideal to buy the planes. But finding such a buyer when the struggling airline is looking to exit the business would be an uphill task. If the airline doesn't find a buyer, it would have...

What are Barriers to Entry & Types of Barriers to Entry

Let's suppose someone wants to start a lemonade stand. Getting one up and running would be relatively easy and within the financial reach of the majority of the population. In this case, one could say that the barriers to entry to starting a lemonade stand business are low. On the other hand, if you wanted to start a new airline, getting one up and running would be relatively more difficult than starting a lemonade stand and outside the financial reach of the majority of the population. And say even if you had the financial resources needed to create an airline,...

Amazon Unbound Book Summary

In 2014, Brad stone published 'The Everything Store: Jeff Bezos and the Age of Amazon,' chronicling Amazon's journey from its inception until the year of publishing. In 2021, Brad Stone released another book, Amazon Unbound: Jeff Bezos and the Invention of a Global Empire, chronicling Amazon's growth from 2014 to 2021. Both books are essential reading for those who want to make sense of Amazon's all-encompassing and, at times, perplexing business. I read 'The Everything Store,' Stone's first book on Amazon, and made a book summary in Dec 2020. So, when Stone released 'Amazon Unbound' in May 2021, I decided to read...

Instagram Business Model Case Study

In April 2012, Facebook acquired Instagram for a then-unprecedented $1billion. At the time of the acquisition, Instagram was growing fast, but it had only 25 million registered users — minuscule compared to Facebook's hundreds of million users. To top it off, Instagram was not bringing in any revenue; it was being run by 13 employees and only two years old. Before Facebook closed the deal, even Twitter had tried its hand at courting Instagram. But Instagram's founders, Kevin Systrom and Mike Krieger decided to go ahead with Facebook because other than the massive sum of money, Zukurberg dangled the carrot of independence. If Instagram...