If you have ever been a participant in a discussion around establishing a startup, there is no chance you have not heard about the term business model. In case you have not, the startup business is all we are going to discuss in this article. So what exactly is a business model? A business model is nothing but a long term plan that focuses on value, both for the business and the customer.

A business model should be such that it delivers value to its consumers consistently while helping the business monetize the strategies. If you are in the process of starting your business or looking for a better plan to roll things out, this article might serve you the purpose. Read on to know about 4 such business models.

Marketplace Model

It is the kind of business model where a business makes money by charging the buyers and sellers some transaction fees for using their platform. The best part about this model is that the server you need to run your business doesn’t cost that much money and the cost will only go down in the future. You can take inspiration from companies like Uber and Amazon

Sponsorship Model

Have you ever given a thought to how youtube actually earns? Think right now. If you are clueless about it, we will walk you through its business model, that is sponsorship based. In this model, the businesses usually make money from the sponsors and the users usually do not pay to use the platform. Other than youtube, Wikipedia could serve as a great example. 


In the franchise business model, Franchisee pays royalties to the Franchisor to use the brand’s name, logo, values, business model, as well as how the entire operation works. Rapid growth can be achieved without much capital vs full ownership. The best part of buying out a franchise is that you do not need to invest a huge chunk of money in the form of capital, rather you will get a steady and regular income out of your association with the established name. The best examples could be food chains such as McDonald’s India.


This is the business model where the businesses give the responsibility to their resellers to sell the products on their behalf. If we talk about the USP of this business model then it would surely be the hassle-free experience of not managing the inventory, as it is managed by the resellers. A great would be Amway. Just by going through its business model, you will get to realize how efficiently and profitably the company has been running the business all this while.

It is important to understand that a single kind of business model would suit all kinds of businesses. Think through what your business is all about and what is it that you want to deliver to your customer and what you want to achieve as a business. Once you have a clear picture, it's just a matter of time before you see a business model fitting your needs perfectly.