GovTech Business Model Canvas

When a lot of founders begin the journey of building a startup they start with something called a “Business Model Canvas.” This is a simple and structured alternative to creating a business plan that can help you better understand the business opportunity you’re planning to go after. They are great first steps after you’ve defined the problem.

One of the great elements of GovTech is that the B2B frameworks we use to build and understand startups can often be used for B2G — we just have to provide a little bit of a twist along with government contextual understanding. That’s why I created the GovTech Business Model Canvas. It’s a simple 9 step process to help you answer key question you need to understand and truly internalize before fully going after and building a GovTech startup.

GovTech Business Model Canvas

The GovTech business model canvas walks you through the following key areas:

  1. Issue/Opportunity — This is the problem that you’re trying to solve. Similar to B2B enterprise startups, GovTech startups are all fundamentally software solutions to existing problems.
  2. Ideal User Profile — This is who you expect to use the product. This may be a single individual, a team, or a group of people. This are the folks your software engineers and product people will spend the most time with iterating over the product. Once you identify the IUP, I recommend you spend a day or two shadowing them — you might be surprised by what you learn.
  3. Stakeholders and Buyers — These are the gatekeepers, and you need to understand who they are in government. This could be a manager, a city manager, another department like procurement or IT. The more complex, the longer the expected sales cycle will be.
  4. Urgency — Why now? What’s changed that makes the job of the ideal user profile more difficult? Is there new regulation? A new law? Urgency helps accelerate the go-to-market by creating a pull in the market, it’s ideal that there’s some level of urgency though product strength network effects can help if there isn’t any clear urgency in the market.
  5. Buying Process — Understanding the buyer isn’t all it takes, this is government after all! You also need to understand HOW a purchase is made. Does there need to be an RFP/RFQ? Can you come below a procurement threshold?
  6. Product & Features — This is often where people want to start after they define the issue/opportunity. I urge every GovTech founder not to jump to product. It’s 6th on this list because everything above is key for you to understand before you start writing a single line of code.
  7. Funding — How do you plan to finance your business? Do you know who the players are? At Storm Ventures, we like to fund startups that are just post product market fit. We define this as a company with a few customers buying the product for the same reason. We urge every GovTech company to always have a line of sight to cash flow breakeven.
  8. Risks & Competition — What are the challenges you expect on the go-to-market? Who are the competitors? What are they doing well and not so well? How are you differentiated?
  9. Thought Leadership — This is something you won’t find on the standard Business Model Canvas, but it’s key. Thought leadership is how you define the “new way” in any new category. It’s likely that the average civil servant hasn’t used a product like the one you want to build, so you need to help civil servants talk about the product you’ve built. You need to create rich content that talks about the benefits. You need to show people what the “new way” is and how to join “the movement.”

And there you have it, the GovTech Business Model Canvas.

Special thanks to the folks at the World Economic Forum, I used their Digital Policy Model Canvas as a template for creating the GovTech Business Model Canvas.

Storm Ventures
Venture Capital