[MUSIC] We have frameworks and tools that help us diagram, illustrate, and capture business models. And start to innovate them. And how do we put that all to work? That's what we'll be focusing on here. Before we move on to customer discovery, however, let's take a look and create a real time example of a business opportunity that we're presented with and the different types of business models that we might employ. That's the first exercise that we'll undertake here in this category. And in fact, this particular exercise deals with cows. What I'd like you to do would be to think about the different types of business models that you can come up with to monetize a cow or a herd of cows. Now some of them are somewhat obvious. If we take a look at a few of the more obvious ones we'll include things such as beef production or milk production or leather production. But beyond those there are a lot of other ways that you might be able to monetize a cow. Now I want you to go ahead and pause your recording right now for three minutes, give yourself three minutes. So I like you to be as creative as possible, and think about what are the things that you might be able to do to create a business. Humorous, serious or otherwise around cows. Ready? Go ahead and pause your computer. Take three minutes right now. Okay. So we're back. You paused your computer, you've got your list. And again, I'm about to move on to some of the examples that I might think of. So if you are not ready, take a moment. All right, here's some examples, beyond the three that I mentioned already, that I might think of as different ways to monetize a cow. In addition to the beef, milk, and leather, you might offer cow rides. You might go into the business of cows as pets. How about cow art? Perhaps setting up exhibitions either of cows as art or, perhaps, allow people to paint cows. What if you wanted to rent a cow? For the weekend, for the day, for the hour. How about using cows to help manage people lawns as opposed to a gardening service. You bring in a few cows and they go ahead and crop that lawn nice and low but perhaps with control. We've seen that in goats and sheeps. Why not do it with cows? Another thing about cows, is that while they may eat a lot of grass, and feed, well, they also create a bit of a mess. And that mess can be used to create methane gas. So perhaps you go into the business of being an energy producer. Another one, why not think about using cows as watch cows? Kind of like watch dogs, but they're bigger and they'd move if there was an intruder. Maybe have a number of cows that have cowbells of different sizes and you could train them to play songs in a cowbell orchestra. Or cow racing, kind of like horse racing but with cows. Maybe we do shared cow ownership. I get one tenth of a cow as do nine others that decide to invest in the cows. Or I can get a cow for a month a year. We could do cow petting. Or cow tipping, I don't know if you know anything about cow tipping, but you sneak into a pasture at night while the cows are sleeping and you try and tip them over. That's kind of a college prank. There are plenty of things that you can do with cows to think about how you might monetize those cows. Now we have a number of ideas attached to them, but what are the business models that we might then utilize for these various types of ideas? Well traditionally we would have cow ownership, but perhaps we could think about crowdfunding cows. In other words, we will agree that once we raise X amount of money across, all of us will go ahead and buy a cow, and then we can share whatever benefits come from it. What about a freemium model for cows? Let's say we did cow rides. The first cow ride is free but you have to pay for every cow ride after that. Or pay-per-use, a version of the freemium model there. Or direct sales, when we set up an Amazon for cows and offer cows directly to anybody who wants them. We could set up subscription models. Or think of Cow-as-a-service, instead of owning a cow let's offer people to rent a cow. Or think of cow as a service to do what ever it is that we want. We might have a sponsorship model. People who sell cow-based products might want to sponsor a cow and then let you used that cow for a period of time. We can have fractional ownership. Perhaps that it's a little related to the crowd funding that we mention earlier or franchise. And that is, there's a special way to own cows and I'm going to franchise that to individuals. Let's use that razor and blades model. In other words, I'm going to sell you the cows inexpensively but the feed, the upkeep and all the other things you need to maintain a happy cow, I'm going to charge a lot of money for. Perhaps we want to create a cow market place. For people who get tired of their cows or they want, different color cows. They can vertex or they can buy and sell cows from one another, where the middlemen, where the eBay of cows. Maybe we even think about a cow based currency to create a different form of exchange. Now some of these may seem a little bit silly but as we're thinking about business models let's go back to that list of business models of companies that are fundamentally disrupting existing businesses. And let's apply some of those business models that I just mentioned. Airbnb is creating a new type of marketplace between buyers and sellers. Uber transportation as a service. A different way of thinking about taxis or car ownership. Dropbox, a freemium model, start out free and then pay as you use more. Amazon direct sales. The Dollar Shave Club, well that's the razors and blades model, but it's also a subscription service. Tesla, by eliminating the dealers, they're going direct. Of course, they're also innovating dramatically through other types of technology. Spotify, music as a service as opposed to owning it and also a freemium model. And BitCoin, well we talked about a cow based currency, but what's the BitCoin currency based on with blockchain? Something else all together, a different unit of value. So while we can have some fun with our cows and we think about how those different business models might be employed in developing cow-based businesses. We can also bring that forward and say we can apply these types of business models to, really, almost any type of product or service. At least in different types. So, what we're going to do when we return is we're going to say how do we test which of these business modules work best in different types of markets, with different types of products, and with different types of customers.