A two-tier business model and its realization for entrepreneurship

Abstract

Entrepreneurs are important to economic development. Business model design is critical to assist entrepreneurs. This study proposes a two-tier business model for entrepreneurs, consisting of a conceptual model and a financial model. The conceptual model describes the idea of a new business which is useful to explain a business. The financial model provides the numbers of the new business which makes the business model accountable and measurable. The two-tier business model is more applicable in that on one hand, the model addresses the conceptual and financial issues separately to avoid confusion; on the other hand, the model integrates both the conceptual and financial models to provide a complete view of the business. Each of the conceptual and financial models provides the relationships among their components. In addition, the two-tier business model shows the relationships between both models. This study realizes the business model by the application of Internet. In addition, two real cases, including Apps and one million dollar home page, exemplify the practices.