Tech-enabled Business Model

Extracted Attributes

• Gross Margins

  Lower than pure software business models

• Key Evaluation Metric

  Rule of 40 (often used for comparison with B2B SaaS)

• Common Financial Risks

  Floating-rate debt and sensitivity to interest rate fluctuations

• Operational Challenges

  Subscriber churn in B2C models and capital-intensive asset management

• Estimated Incremental Revenue Growth

  $132 billion to $382 billion for industrial sectors

Timeline

• The All-In Podcast hosts discuss the distinction between tech-enabled and software models during the World Economic Forum in Davos. (Source: Document fb009ead-fe3d-4f58-bfc8-0a9d2c19cec9)

  2024-01-17

• Analysis of Adam Neumann's Flow venture reveals financial difficulties due to real estate investing at market peaks with floating-rate debt. (Source: Document fb009ead-fe3d-4f58-bfc8-0a9d2c19cec9)

  2024-01-17

Acton Capital

Acton Capital is a German venture capital fund, founded in Munich and investing in tech-enabled startup companies in Europe and North America.

Web Search Results

• [PDF] Tech-enabled transformation - McKinsey

  Creating data-enabled business models New business models offer the largest opportunity in tech-enabled product development, with an estimated $132 billion to $382 billion in incremental industry revenue growth. Some of these business models are likely to disaggregate value chains in much the same way that Uber is disrupting investment allocations for automotive companies, and increasingly aerospace companies as well. Manufacturers of mining equipment, for example, could explore a range of [...] from connected products • Creating data-enabled business models • Optimizing R&D processes with tech enablement • Optimizing procurement • Enhancing forecasting and demand planning • Digitizing manufacturing and assembling • Streamlining distribution and delivery • Enhancing presales and discovery through digital marketing • Transforming customer experience • Optimizing pricing • Enabling IoT at dealers and retailers • Modernizing the finance function • Optimizing workforce deployment (Human [...] products and services is fast becoming the new battleground. Companies are not only enhancing their offerings through software and data but making the transition from selling hardware-based products to creating tech-enabled businesses.

• Don't start a tech-enabled service - Startup Real Talk

  Here’s the image you’d show in your pitch deck/investment memo: Replace “accounting” with almost any other services business, and you see why the pitch is incredibly compelling to founders, and incredibly compelling to investors. I absolutely think this is the future. There are massive industries today that, when tech-enabled, will end up being dramatically more efficient/effective, and a small number of players will emerge as the dominant providers of those services. [...] Yes, I recognize the irony of that advice coming from the CEO of a tech-enabled service, but here’s why. There’s a lot to like about the tech-enabled services model. But it’s also punishingly hard—so make sure you understand what you’re signing up for before you embark on this journey. # Why are tech-enabled services the future? [...] The bull case for any tech-enabled service goes like this: $60 billion is spent every year in the United States on accounting for SMBs. That $60 billion is earned by a long tail of small local and regional providers, and those providers currently do what they do entirely by hand, essentially, with the complete absence of technology.

• A New Perspective on Business Model Design

  Technology usage-based business modeling is a way to explore business modeling for technology that looks into how different technologies are integrated, either by users or platform actors, into solutions to address specific usage needs. To understand this notion of usage for business model design, one must first understand how value is created and captured from technology. At the same time, it is also important to know different streams of literature that have investigated technology usage: [...] Companies need business models to profit from innovation and technology. However, the success of a certain technology depends on whether and how it is used. Usage is important not only as an indicator of technology adoption, but also as a way for companies to design business models—as a way to create and capture value from technology. Usage is inscribed by the designers in the technology, but users in their ongoing practice can alter the designers’ intentions, which sometimes leads to [...] Jump to Content Close Bookmark ## Share Link Copy this link, or click below to email it to a friend Email or copy the link directly: The link was not copied. Your current browser may not support copying via this button. Link copied successfully Sign in Article Navigation Sign in Get help with access Sign in via your Institution ## Article contents Show Summary Details # Business Models and Usage of Technology: A New Perspective on Business Model Design

• How innovative companies leverage tech to outperform

  In addition, the vast majority of these companies capture the cost and flexibility benefits that digital platforms and cloud business models can bring. Organizations with complex partner networks, for instance, can use technology backbones to cascade small design changes throughout their supply chains. Finally, leading innovators have the pull to attract top tech talent, using this talent as a “force multiplier” to accelerate innovation in their business models and their offerings. [...] Our experience shows that for digital transformations to succeed, companies must not only develop data and technology capabilities but also change their operating models. We previously reported that companies unlock the most value with technology when they apply it to innovating their entire business model rather than focusing on disconnected use cases. Our latest research confirms that finding and also shows that innovative companies prioritize technologies and operating model changes that [...] These organizations were also more than ten times as likely as those with weak innovation cultures to be overall economic outperformers, ranking in the top decile in both revenue growth and EBIT. While some of this success could stem from other factors, it is clear that the innovation outcomes, enabled by specific technology investments, play a role.

• Nine AI-fuelled business models that leaders can't ignore - PwC

  While past tech shifts—like cloud, mobile and the internet—also enabled new business models and rapid-growth industries, AI is notable in its potential to transform the economics of product and service creation, customisation and scale with its ability to reason, to continuously learn and to use natural language to interact with humans. In many cases, the large language models at the foundation of GenAI allow companies to create additional units of output—the design of a personalised product, a [...] environments, whereas higher-risk autonomous decision-making systems will likely require governments, industries and society to align on responsible use of AI worldwide. Evaluating what your biggest competitor might do, how your business may evolve and what capability investments are needed can help your organisation not only contemplate (and prepare for) new AI-enabled business models’ effect on your future viability but also surface opportunities to improve how you compete today. [...] The breakneck pace of GenAI adoption (with ChatGPT alone potentially closing in on nearly 1 billion users) and the encouraging business results offer an early indication of the technology’s promise. However, it’s still unknown how broadly and deeply these new AI-fuelled business models will take hold. Some will be heavily influenced by the pace of AI adoption, shaped by the degree of trust in the technology, supporting governance models, and emerging capabilities to verify, authenticate and