How to Explain Your Business Model in 7 Sentences (With Examples)
- Baran Korkut
- Feb 18
- 8 min read
Updated: Mar 12
Explaining a business model requires more than just describing an idea—it needs structure, clarity, and validation. Whether you're presenting to investors, stakeholders, or your internal team, a strong business model presentation should flow logically, ensuring that each element connects to the next.
This framework follows 7 key sentences. The sentences follow the 9 building block of the business model and follow the different stages of a business model going from problem – solution fit, product – market fit and business model fit. Very early ideas don’t need a business model yet:
Problem-Solution Fit – Define your customers, their key job to be done, their pain points, and how your solution helps.
Problem Validation – Show how you verified that the problem is real and worth solving.
Solution Validation – Demonstrate how you tested your solution and what results proved its value.
Building the Value Proposition – Explain how key activities and resources create the value you offer.
Customer Acquisition & Retention – Outline how you attract and keep customers through channels and relationships.
Business Model Moats – Highlight why your business model is defensible and hard to replicate.
Traction – Show measurable progress and your targets for the next growth phase.
The sentence structures could be used at any stage of a business model, but the contents (focus) should change as the business model matures.
You can use this shorthand cheat sheet for a clear, data-backed way to explain any business model in a concise, compelling manner. Each sentence builds upon the previous one, making the business model easy to follow, validate, and defend.
Problem-Solution Fit
Every successful business starts with a clear problem-solution fit—understanding who your customers are, what they need, and how your solution helps. This sentence ensures that your value proposition is anchored in real customer needs.
Q: Who are your customers, what problems do they face, and how do you solve it?
Our business serves [Customer Segment 1] who need to [Key Job to Be Done] but struggle with [Key Pain]. {If platform:} At the same time, we help [Customer Segment 2] by enabling them to [Key Job to Be Done], solving their challenge of [Key Pain]. We solve this by providing [Solution], which uniquely [Unique Advantage—what makes this offering different or hard to replicate].
B2C Fitness App
"Our business serves busy professionals who need to maintain a healthy lifestyle but struggle with finding time and motivation to exercise. We solve this by providing an AI-powered fitness app that creates personalized, time-efficient workouts, which uniquely adapts to individual energy levels and schedules, making it easier to stay consistent."
B2B Project Management Software
"Our business serves mid-sized companies that need to manage remote teams effectively but struggle with disorganized workflows and lack of visibility. We solve this by providing an intuitive project management platform, which uniquely integrates real-time AI-driven task prioritization and automated reporting to help teams stay aligned effortlessly."
Platform Travel Marketplace
"Our business serves travelers who need to find affordable and unique accommodations but struggle with expensive hotels and lack of local experiences. At the same time, we help homeowners by enabling them to monetize their extra space, solving their challenge of underutilized property. We solve this by providing a trusted marketplace where travelers can book stays directly from local hosts, which uniquely leverages a global network of user-generated reviews and AI-driven trust signals to ensure a seamless and secure booking experience for both sides."
Problem Validation
Claiming there is a solution to the problem is great, but words are meaningless without proof. This and the next sentence are required to be taken seriously.
Q: How do you know this problem is real?
We validated this problem by [Experiment or Research Method], where we found that [Key Insight—what evidence showed the problem is real and significant] . This confirmed that [Customer Segment] actively struggles with [Problem] and is looking for a solution.
B2C Fitness App
"We validated this problem by surveying 1,000 professionals and found that 78% struggled to stay consistent with workouts due to lack of time and motivation. This confirmed that busy professionals actively face challenges in maintaining a fitness routine and are looking for a flexible, guided solution."
B2B Project Management Software
"We validated this problem by conducting 50 customer interviews and running a survey with 500 remote managers, where we found that 72% cited disorganized workflows as their biggest challenge. This confirmed that mid-sized companies actively struggle with project visibility and are seeking better solutions."
Platform Travel Marketplace
"We validated this problem by analyzing hotel occupancy rates and conducting focus groups with travelers, where we found that 65% of budget travelers were dissatisfied with hotel pricing and lack of local experiences. This confirmed that independent travelers struggle with affordable, authentic accommodation options."
Solution Validation
Once the problem is validated, the next step is proving that the solution works. This sentence demonstrates the experiments and data that confirm the value of your solution.
Q: How do you know our solution works?
We tested our solution by [Experiment Type—MVP, pilot, prototype, A/B test, etc.], which resulted in [Key Metric—adoption rate, engagement, revenue, retention, etc.]. This demonstrated that [Customer Segment] found value in [Solution] and were willing to [Desired Action—pay for it, switch from an alternative, refer others, etc.].
B2C Fitness App
We tested our solution by launching a beta version of our AI-powered fitness app, which resulted in a 60% user retention rate after three months. This demonstrated that busy professionals found value in personalized, adaptive workouts and were willing to continue using the platform long-term.
B2B Project Management Software
We tested our solution by launching a no-code MVP with a limited feature set, which resulted in a 45% trial-to-paid conversion rate within three months. This demonstrated that mid-sized companies found value in our platform and were willing to pay for improved project visibility.
Platform Travel Marketplace
We tested our solution by building a basic listing site and manually connecting hosts with travelers, which resulted in an 80% rebooking rate within the first six months. This demonstrated that both travelers and hosts found value in direct short-term rentals and preferred it over traditional hotels.
Building the Value Proposition
In the first sentence you explain the solution, this sentence highlights Key Activities (what the business does) and Key Resources (what assets make it possible) to ensure the value proposition is sustainable and defensible. Early on, there is just an MVP built in the most frugal way possible. Key activities and resources don’t matter much. However, as the business model matures and acquisitions start, these matter.
Q: What do you do, and what key resources make it possible?
We create and deliver this value by [Key Activities—what the business does to create and deliver the value], leveraging [Key Resources—unique assets, tech, expertise, partnerships, etc.] to ensure [Customer Segment] receives [Core Value Proposition—main benefit the customer gets].
B2C Fitness App
We create and deliver this value by developing AI-driven personalized workout plans, collecting real-time movement data, and refining recommendations through continuous feedback loops, leveraging proprietary motion-tracking technology and a certified coaching network to ensure busy professionals receive adaptive, effective fitness programs.
B2B Project Management Software
We create and deliver this value by designing intuitive collaboration tools, integrating with existing enterprise software, and continuously improving workflow automation, leveraging our cloud-based AI engine and strategic partnerships with workplace tool providers to ensure mid-sized companies have a seamless, efficient project management experience.
Platform Travel Marketplace
We create and deliver this value by onboarding and verifying hosts, optimizing search and pricing algorithms, and maintaining platform security, leveraging a global trust-based rating system and AI-driven fraud detection to ensure travelers find unique, affordable stays while hosts gain reliable income.
Customer Acquisition & Retention
Acquiring customers and keeping them engaged ensures sustainable growth. This sentence explains how the business attracts customers (Channels) and how it nurtures relationships (Customer Relationships) to encourage retention and loyalty.
Q: How do you attract and keep customers?
We acquire customers through [Channels—direct sales, online ads, partnerships, organic growth, etc.] and build strong relationships by [Customer Relationship Strategy—community building, loyalty programs, personalized support, etc.], ensuring [Customer Segment] engages with and stays loyal to our solution over time.
B2C Fitness App
We acquire customers through targeted digital ads, influencer partnerships, and app store optimization, and build strong relationships by offering personalized coaching, progress tracking, and social challenges, ensuring busy professionals stay motivated and committed to their fitness goals.
B2B Project Management Software
We acquire customers through content marketing, referral partnerships, and direct enterprise sales, and build strong relationships by providing dedicated onboarding, ongoing support, and in-depth analytics, ensuring mid-sized companies integrate our platform seamlessly into their workflows and continue using it long-term.
Platform Travel Marketplace
We acquire customers through SEO, paid ads, and partnerships with travel influencers, and build strong relationships by offering secure transactions, a transparent review system, and host support services, ensuring travelers trust our platform and hosts feel confident listing their properties.
Business Model Moats
A business model moat protects a company from competition by making it difficult to copy or outcompete. Moats typically arise from:
Proprietary Technology Moat: We have a unique algorithm/data/IP that others can’t easily replicate.
Community Moat: Our engaged users create network effects that make our platform stronger as it grows.
Cost Advantage Moat: Our cost structure allows us to scale profitably where others can’t.
Exclusive Channels Moat: We have locked in key partnerships or distribution channels that competitors can’t access.
Q: What protects you from competitors copying your model?
Our business model is defensible because [Moat ], making it difficult for competitors to replicate our success.
B2C Fitness App – Proprietary Technology Moat
Our business model is defensible because we leverage proprietary AI-powered workout personalization, making it difficult for competitors to replicate our adaptive fitness experience.
B2B Project Management Software – Cost Advantage Moat
Our business model is defensible because we optimize cloud infrastructure costs at scale, allowing us to offer premium features at a lower price than competitors.
Platform Travel Marketplace – Community Moat
Our business model is defensible because we have built a deeply engaged global community of hosts and travelers, making it difficult for new entrants to attract both sides of the marketplace at scale.
Traction
Traction validates that a business is gaining momentum. This sentence describes the value metric being tracked, current performance, and the growth target for the next foreseeable period.
Q: What progress have you made, and what’s your next goal?
We measure traction by [Value Metric—waiting list signups, active users, revenue, transactions, etc.]. To date, we have achieved [Current Performance—number of signups, revenue milestones, usage metrics, etc.], growing at [Growth Rate]. Our target for the next [Time Period—quarter, year, etc.] is to reach [Future Goal].
B2C Fitness App – Early Stage – Community Traction
We measure traction by the number of active beta users and engagement levels in our online fitness community. To date, we have onboarded 5,000 beta users with a 60% weekly engagement rate, growing at 20% month-over-month. Our target for the next six months is to reach 50,000 engaged users.
B2B Project Management Software – Mid-Stage – Pilot Traction
We measure traction by the number of companies actively piloting our platform. To date, we have secured pilots with 30 mid-sized companies, representing 5,000 users, with a 75% retention rate after three months. Our target for the next quarter is to convert 50% of these pilots into paying customers and expand to 100 pilot companies.
Platform Travel Marketplace – Growth Stage – Revenue & Transactions
We measure traction by the number of bookings completed and total transaction value on the platform. To date, we have facilitated 1.5 million bookings, generating $500 million in total transaction volume, growing at 35% annually. Our target for the next year is to reach 3 million bookings and $1 billion in transaction volume.
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