The 12 Standard Forms of Value from Personal MBA Book
Personal MBA , a book by Josh Kaufman, is “an alternative to business school” at the price of a book.
In the book, Josh suggests that no matter what industry you are in, the way you provide value (ahem, make money) to the market falls into one of twelve buckets.
I find this list of 12 particularly helpful to share with entrepreneurs at the earliest stages of their business-building enterprise. Asking them to identify which of the 12 Standard Forms of Value are 1) most common in their industry and 2) which they plan to leverage as their core method.
Determining this from the onset, is a sure-fire way to help you determine your pricing and marketing strategy quick, among other things, even if it changes or evolves over time.
So without further ado, here are the 12 types of value provided by Josh Kaufman in his work, the Personal MBA.
Product. Create a single tangible item or entity, then sell and deliver it for more than what it cost to make.
Service. Provide help or assistance, then charge a fee for the benefits rendered.
Shared Resource. Create a durable asset that can be used by many people, then charge for access.
Subscription. Offer a benefit on an ongoing basis, and charge a recurring fee.
Resale. Acquire an asset, then sell that asset to a retail buyer at a higher price.
Lease. Acquire an asset, then allow another person to use that asset for a predefined amount of time in exchange for a fee.
Agency. Market and sell an asset or service you don’t own on behalf of a third party, then collect a percentage of the transaction price as a fee.
Audience Aggregation. Get the attention of a group of people with certain characteristics, then sell access in the form of advertising to another business looking to reach that audience.
Loan. Lend a certain amount of money, then collect payments over a predefined period of time equal to the original loan plus a predefined interest rate.
Option. Offer the ability to take a predefined action for a fixed period of time in exchange for a fee.
Insurance. Take on the risk of some specific bad thing happening to the policy holder in exchange for a predefined series of payments, then pay out claims only when the bad thing actually happens.
Capital. Purchase an ownership stake in a business, then collect a corresponding portion of the profit as a one-time payout or ongoing dividend.
What do you think? Did he leave anything out? Are you ideating around a business idea right now? If so, which of the 12 offering categories do your offerings fall into?
