Or don’t they? How important is a business model for an internet start-up? Crucial? Some people advise companies to focus on gaining critical mass and believe that profit will follow. It won’t hurt to have one. What should Bemba do? Evan wrote in article about valuating new product ideas: ‘Far be it for me to say that obvious monetizability is a requirement. I’m generally a believer that if you create value, you can figure out the business. However, all things being equal, an idea with clear buck-making potential is better than one without. Whether or not something is monetizable is not always clear up-front. In most cases, if you position yourself close to the spending of money, you can extract some. Or if you offer something that clearly saves or makes people money.’

Okay. Do I agree because what Evan says is what I want to hear? Although Bemba Media didn’t position itself close to spending money, I do believe that Bemba.com will create value for its users. So we will be all right? Give me some more to read!

According to Jason on Calacanis, ‘running a startup is NOT about revenue anymore, it’s about critical mass. It’s about scale. When you’re playing in the big leagues with unlimited access to capital you shouldn’t worry about revenue BEFORE you have critical mass.’ And then Jason writes: ‘Note: if you’re not a player like Ev, and you don’t have unlimited access to capital do not take this advice and focus on building revenue streams.’

This is awakening. To my idea, Florian makes it all clear in his comment to Jason’s post: ‘1. Don’t start your business if you plan to have no revenue, 2. If you do start a business and you see no revenue - go for the mass, 3. Once you have millions of users you will always make money.’

The new Bemba.com - end of January 2008 - will differ from the product that we drew in our business plan. It will become better for the users, but harder to monetize. One thing has been clear from the start. We need to go for the mass. Millions. It will take time! Does this mean that we can stop thinking about our business model for the time being?

I like the way Fred wrote ‘Why You Can Sometimes Wait For Scale To Execute Your Business Model’. He says: ‘If you are building a media oriented business, particularly one that has low marginal costs, meaning you build it once and the cost to serve an additional customer is negligible, then you have the unique opportunity to focus first and foremost on building your customer base or audience. Most web apps will be monetized with some kind of media model. Think of all the various ways that an audience that is paying attention to your service can be paid for by companies and people who want some of that attention. If the marginal cost to service an additional customer is negligible, then you can wait to monetize. If it’s not, then you are going to have to focus on your business model earlier in the life of your business. It’s really that simple.’

In Dion’s ‘Web 2.0 Predictions for 2008’ on Social Computing, he writes: ‘at least one major new API monetization model will emerge in 2008 that will prove to have long term legs. My bet: The costs will increasingly be bundled into a Web 2.0 application’s subscription fee or other business model, even if they use an API of the user’s preference’.

In the end, this is what I think.
- Critical mass will be monetizable
- Bemba should focus on getting critical mass!
- We need to discover extra value that can be monetized
- We need to stay up-to-date about API monetization
- We need to be creative and search for easy models

No, business models don’t suck at all. What’s your opinion?