SPECIAL LETTER: BUSINESS MODEL DIVERSIFICATION

THE STRATEGIC NEWS SERVICE ©

GLOBAL REPORT ONTECHNOLOGY AND

THE ECONOMY ™

SNS SUBSCRIBER EDITION • VOLUME 25, ISSUE 40 • WEEK OF OCTOBER 26, 2020

SPECIAL LETTER:

BUSINESS MODEL DIVERSIFICATION

Strategic News Service, the first paid subscription newsletter on the internet, was started 25 years ago.

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SNS: Business Model Diversification Week of October 26, 2020 2

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SPECIAL LETTER

BUSINESS MODEL DIVERSIFICATION: Risk-Proofing Your Strategy … a means to winning The Great Race

By William J. Ribaudo, with Seema Bajaj, Parikshit Sinha, and Aditya P. Singh

Publisher’s Note: SNS members have long known of our deep conviction that business models provide the best lens by which to view companies and countries. United with the patterns of the actions (and almost never of the words) of their leaders, this also allows uncanny prediction accuracy on what they will do next, and why.

Members may recall the project SNS and Deloitte did in cooperation a few years ago, applying the learnings of Bill Ribaudo’s team regarding how Wall Street rewarded four corporate business model types, with our work on the effect on country GDP of whether they were thieves or inventors, or something in between.

In this issue, Bill’s team shares a chapter of their upcoming book, offering companies a clear path on how to move from a low-multiple (of revenues) category into something safer, and of greater value.

Not only is this view of the core values of each of our business models brilliant and useful – it’s also many times more important to the many companies pivoting for their lives during the Covid pandemic. I expect that will include many, if not most, of our member companies today. Happy reading. – mra

In This IssueVol. 25 Issue 40

BUSINESS MODEL

DIVERSIFICATION

• The BMD Study Value

Proposition

• Recap of the RMx

Framework

• The BMD Difference: How

Companies Perform During a

Crisis

• The BMD Methodology: Data

Structure and Approach

• BMD Analysis of Major Crisis

Events

• The BMD Study: Key Findings

from Crisis Events

• How Business Models Affect

Resilience and Tenacity

• Industry Analysis Reflects

Merits of BMD and RMx

Insights

• The Impact of BMD Study

Insights on the Great

(Country) Race

• Putting Our Findings to Work

in Times of Crisis and

Beyond

• Conclusion

• About William J. Ribaudo

• About the Co-Authors

OUR PARTNERS

WHERE’S MARK?

Refer a Friend

Download This Issue



SPECIAL LETTER

BUSINESS MODEL DIVERSIFICATION: Risk-Proofing Your Strategy … a means to winning The Great Race

By William J. Ribaudo, with Seema Bajaj, Parikshit Sinha, and Aditya P. Singh

The last few decades have featured unprecedented technological advancements and innovations. At the same time, the global economy has been repeatedly shaken by market disruption events, such as the subprime lending crisis and the COVID-19 pandemic. In times such as these, evaluating a company’s strategy and approach to risk management, particularly in its business model mix, becomes even more important. Deloitte’s Revenue Multiplier (RMx) business model framework1 proposes a provocative new take on business models, the value and risks they create, and innovative ways to risk-proof your strategy in times of crisis and beyond.

Our research supporting the RMx business model framework shows that companies that monetize intangible assets, such as technology, communities, intellectual property (IP), and networks, among others, are valued more highly than those with primarily physical or tangible assets. These findings can be especially helpful in times of great uncertainty, serving as a strategic filter for scenario planning and paving the way for dynamic crisis management. The Revenue Multiplier research presents a compelling framework for leaders committed to responding to, or getting ahead of, digital business model disruption and unlocking value creation.

The bottom line of our latest research: During an economic crisis, the value of all companies declines in the short-to-medium term, but those with technology-based business models as part of their business model mix experience a gentler fall, have greater resilience, and recover faster.

The Business Model Diversification (BMD) Study Value Proposition

Our Business Model Diversification (BMD) study builds on our RMx business model framework (see Fig. 1), observing how each of the four business models (Asset Builder, Service Provider, Technology Creator, and Network Orchestrator, which will be defined later in this article) performed during two separate global crisis events – the COVID-19 pandemic and the subprime lending crisis.

1 Technology is changing how we view industry, value companies, and develop strategy, William J. Ribaudo and Seema Bajaj,

Strategic News Service Global Report, May 2016. https://www2.deloitte.com/content/dam/Deloitte/us/Documents/technology-media-telecommunications/us-tmt-technology-is-changing-how-we-view-value-develop.pdf



Figure 1. Revenue Multiplier business model framework

Key insights from this study can serve as a tool for executives – one focused on assessing a company’s strategic risk, including its business model mix, to help understand resilience and recovery potential in challenging market situations. The BMD study has implications for executives in multiple industries, offering a provocative view about how a range of diversified business models within an organization can both mitigate risk during a crisis and offer value creation potential as companies rebuild for the future. In good economic times and bad, a diversified business model portfolio can provide a route to sustained value creation. Insights from this study can help business leaders reflect on how to leverage existing intangible assets, such as technology, intellectual property, and networks, to enhance revenue-generating capabilities or create new revenue streams. Industry leaders are challenged to rethink and evolve how they manage and exploit risk, using a dynamic approach to risk management that drives strategy, builds resilience, and delivers financial results. This study also has implications for government officials and country leaders seeking to create environments that support businesses with multiple business models, help them survive in even the worst economies, and ultimately contribute to economic recovery. Recap of the RMx Framework Before diving into the BMD study, let’s review some of the core concepts of the RMx business model framework, which directed the study’s choice of metrics, methodology, and approach. Across economies and geographies, industries are converging, driven by now-ubiquitous technology that is redrawing – and in some cases erasing – traditional market boundaries.



• Today’s technology norms – the IoT, AI, blockchain, and edge computing – are removing many barriers to entry, allowing companies to open new channels and new markets faster than ever before.

• This rapid technology innovation is creating space for new business models to emerge in almost every industry.

We took a 40-year look back at the S&P 500 index and found a strong correlation between a company’s valuation and its business model. Our research uncovered a new way to view, analyze, and value companies, based on their business models. The resulting view revealed a “digital divide” in business valuation. Digital technologies were pervasive across the businesses studied. But how technology was used – as “technology-in-the-business” (to enhance efficiency and customer experiences) or “technology-as-the-business” (to build new revenue streams) – determined a company’s placement either above or below the digital divide. Viewing companies through this lens, we identified four foundational business models, two below and two above the digital divide (see Fig. 2):

• Asset Builders use capital to make, market, distribute, and sell physical products.

• Service Providers use people assets to provide services to clients.

• Technology Creators use capital to develop and sell intellectual property, creating a stream of recurring revenue, often through licensing.

• Network Orchestrators use digital networks of businesses or consumers to create, market, and sell goods, services, or information, with the company acting as organizer.

Figure 2. Business models above and below the digital divide



In determining how to view differentiated value across these four business models, we looked at price-to-revenue ratios and concluded that revenue is a more stable and predictable measure (than earnings) and less susceptible to extreme variations. As companies become digitally enabled, they also trade more on revenue performance than on earnings performance. Finally, we looked at how company valuations have changed over time. For the purpose of ascertaining this valuation, we considered Total Enterprise Value (TEV). This metric not only looks at market capitalization as a measure of market valuation, but also incorporates the components of debt and cash equivalents, a critical metric in industries such as industrial manufacturing and financial services. We used the resulting Revenue Multiplier (TEV / revenue) to establish a strong correlation between valuation and business model for companies, industry verticals, and subsectors. We found that for every $1 of revenue generated, Asset Builders and Service Providers generate an average of $1–$2 in valuation, while Technology Creators and Network Orchestrators generate $4–$8. Research on companies and industries in each business model revealed that the range for Asset Builders is 1x–3x, for Service Providers 2x–3.5x, for Technology Creators 4x–7x, and for Network Orchestrators 7x–11x. The BMD Difference: How Companies Perform During a Crisis Our foundational RMx research classified companies by primary business model and saw a pattern in value over time. Richness of insight and depth of analysis stemmed from the evaluation of a broad set of metrics over time. For the BMD study, we built on this foundational research with a dynamic, real-time view that considered market capitalization as a measure of how each business model performed during two separate crisis events: the COVID-19 pandemic and the subprime lending crisis. We evaluated the impact of these high-consequence market disruption events and their influence on a company’s strategy and risk environment, including their potential to disrupt operations, damage reputation, and destroy shareholder value. The BMD Methodology: Data Structure and Approach Our study looked at the market capitalization movement of the top S&P 500 companies in each business model, collectively representing close to 50% of the total value of the S&P 500 on December 31, 2007, for the subprime lending crisis. For the COVID-19 pandemic-led market disruption, we started the data collection process in December 2019 in order to establish a baseline to see how the different business models were performing before the market disruption occurred. The World Health Organization declared COVID-19 a pandemic on March 11, 2020.



For each of the market disruptions studied, our analysis (see Fig. 3) covered a pre-crisis time period in order to establish a baseline, and then continued through when early signs of each crisis appeared through to when a recovery from the crisis was cited or, in the case of COVID-19, to six months after crisis onset (September 2020).

The months and years that we have considered are based on our understanding of each crisis event and on multiple research sources.

Figure 3. Business Model Diversification (BMD) methodology

BMD Analysis of Major Crisis Events

The COVID-19 crisis

We first analyzed the market disruption caused by the COVID-19 pandemic. The impact of the virus brought to a halt daily routines, cultural norms, and business operations. The pandemic triggered unprecedented worldwide economic and social crisis, with mass unemployment; supply chain instability; and government, education, and many other community institutions in upheaval.

We analyzed the market capitalization movement of the top S&P 500 companies (see Fig. 4) in each business model from December 2019 through September 2020. As stated earlier, we started the data collection process in December 2019 in order to establish a baseline to see how the different business models were performing before the market disruption occurred. We observed that:

• The market capitalization of companies across all business modelsdeclined in the short-to-medium term, but the fall was relatively less steep



for Technology Creators and Network Orchestrators (those above the digital divide).

• Technology Creators and Network Orchestrators initially recovered more quickly from the shock, returning to pre-crisis levels as of mid-May 2020, ahead of Asset Builders and Service Providers. This highlights Wall Street’s confidence in the potential for these business models to be bellwethers of recovery.

• While business models above the digital divide returned to pre-crisis levels in mid-May 2020, the models below the digital divide have seen a different path to recovery. Asset Builders took longer to recover to pre-crisis levels (early-July 2020), while Service Providers have only partially recovered to pre-crisis levels (data as of the end of September 2020).

Figure 4. Percentage change in market capitalization of business models during the first six months of the COVID-19 crisis

The subprime lending crisis

We also looked at how business models performed during a crisis for which we could analyze the full data set – from onset through recovery.

The subprime lending crisis is the most recent economic crisis with a full data set, allowing us to analyze how each business model performed during recovery (see Fig. 5). We started the data collection process, and show an elongated timeline, to ensure we have a proper baseline and study the event from onset to a conservative recovery point (one year holding at recovery). Throughout this period, market capitalizations fluctuated dramatically. To present a more well-



rounded view, we considered market capitalization movement on a quarterly basis, observing that:

• The market capitalization of Network Orchestrators and TechnologyCreators recovered to sustainable pre-crisis levels2 at least one year beforethat of Asset Builders and Service Providers. A comparison of somemodels showed these recoveries to be 1.5–2 years ahead.

• The recovery ability of business models above the digital divide wasgreater than that of models below it, as the former leverage intangibleassets (such as technology, intellectual property, and networks) togenerate revenues in uncertain economies.

Figure 5. Percentage change in market capitalization of business models, by quarters, during the subprime lending crisis

Considering the dot-com crash

In considering a third crisis event, we went further back (20 years) and looked at the dot-com crash, which leveled the technology industry and triggered an economic downturn from mid-1999 through 2002. However, during this time period, the S&P 500 had only a single Network Orchestrator – this business model really emerged only in the early 2000s (see Fig. 6). The percentage of Technology Creators was also low in this era, when that business model was in its early stages of maturity. Because of these factors, an analysis of the dot-com crisis and its impact on business models was likely to be incomplete.

2 “Pre-crisis levels” is defined as market capitalization of the business model reaching May 2007 levels and sustaining those levels

for at least a year.



Figure 6. Change in S&P 500 business model composition

The BMD Study: Key Findings from Crisis Events

Across these recent crisis events – even during the worst economies – we observed that investors rewarded the promise of future growth, or perceived value-building potential, of companies with technology-based business models (those above the digital divide).

Our RMx business model framework highlighted that investors may be willing to reward Technology Creators and Network Orchestrators largely on value potential rather than actual profits. This is why companies can receive high valuations despite having little or no profits: investors are betting on the promise of future returns. We are not debating the merit of those high actual valuations; instead, we focus on why these companies are valued higher than companies that make things or sell services. Based on our research, the answer always comes back to the business model, its scalability, and correspondingly higher future profits.

The BMD study results align with this insight, indicating that investors are likely willing to reward newer technology-based business models with higher valuations, even during a crisis or initial recovery. The ability of these business models to leverage intangible assets and scale faster with lower capital investments underlies investors’ faith.

While our foundational research highlighted the ability of Technology Creators and Network Orchestrators to build higher value in normal situations, the BMD study expands this view to cover the likelihood of businesses to stay afloat even in crisis situations. For example, a business might use intangible assets, such as technology, intellectual property, communities and digital networks, among others, not only to manage risk, but also to create value from evolving trends. This further highlights the importance of a mix of business models that can generate value and exploit risks in both good times and bad.



How Business Models Affect Resilience and Tenacity

In observing these crisis events, we saw that the ability of Technology Creators and Network Orchestrators to leverage intangible assets such as technology, intellectual property, networks, and communities gives them both resilience (a slower or softer fall with less impact from a crisis) and tenacity (ability to recover earlier), as shown in Fig. 7.

Figure 7. Comparison of resiliency and tenacity by business model

Both resilience and tenacity are rewarded by higher investor confidence. Businesses with models above the digital divide typically produce recurring revenues, allowing them to sustain their business – even when fighting crisis headwinds – and better positioning them to bounce back. Companies seeking a risk mitigation strategy for crisis events could reduce exposure by pursuing business models both above and below the digital divide.

Industry Analysis Reflects Merits of BMD and RMx Insights

Looking deeper into the BMD study, we reviewed four industry sectors. In the initial months of the COVID-19 pandemic – marked by mandatory stay-at-home orders and significant restrictions on domestic and international travel – airline, hotel, and rental-car bookings ground to a halt almost overnight, making the travel and hospitality industry one of those heavily affected by the COVID-19 crisis. We also looked at the financial services industry, which is experiencing a surge in digital payment channels – another direct result of the current crisis. We selected the final two industries for analysis, industrial and toy manufacturing, because while both have historically occupied a place below the digital divide, technology adoption is changing their business models. Our findings, over multiple time periods and across these very different industries, serve to reiterate the importance of business model diversification, both above and below the digital divide.

Hospitality

Our in-depth study of the hospitality industry identifies companies operating across the value chain, then plots them on the RMx matrix based on their



business model. The intent is to highlight domains where technology and digital innovation are disrupting the industry – for example, by eroding core revenue sources of traditional players or opening up the landscape for newer, less conventional entrants. We wanted to identify levers that, when used properly, could create higher future value for companies in this industry.

In the Asset Builder quadrant, we found traditional property owners and operators. Above the digital divide, several companies in the Technology Creator quadrant have diversified business model mixes, along with a larger portion of revenue from licensing intangible assets – for example, franchising their brands and brand experiences. The Network Orchestrator quadrant largely comprises booking and travel planning platforms, operating on commission-based agency models. This means the platform doesn’t hold inventory, so it is highly scalable and requires minimal capital investment while offering a valuable connection between travelers and hospitality service providers.

For the purpose of the BMD study, we looked at existing hospitality industry study participants in the context of the COVID-19–led market disruption, seeking to explore how it is playing out in a heavily affected industry. We observed that companies that had either spun off tangible asset-heavy businesses into separate companies or created dedicated units to focus on their franchise businesses performed better than those still operating under traditional industry models.

In the COVID-19–impacted environment, hospitality businesses face significant headwinds. They can, however, display both resilience and tenacity by potentially exploring alternative avenues, such as communities, to create pockets for recovery as travel restrictions ease. Their intangible assets – such as platforms loaded with customer data – can also create first-mover advantages used to address emerging business needs.

Let’s take a closer look at how the market capitalization of four hospitality companies, each with a different business model mix, performed in the first months of the current crisis.

Companies A and D Company B Company C

Both companies generate nearly all of their revenues from business models below the digital divide

Generates two-thirds of its revenues from a business model below the digital divide, and the remaining one-third from a model above the digital divide

Generates a little over half of its revenues from business models below the digital divide, and the remaining portion from a model above the digital divide



Figure 8. Percentage change in market capitalization during the first six months of the COVID-19 crisis, hospitality industry

As illustrated in Fig. 8, Companies B and C, with a blend of business models above and below the digital divide, showed greater resilience than Companies A and D, which used no models above the digital divide. Note that between March and April, the stocks of these companies continued to slide, but at a lower rate of decline. Further, those companies with multiple business models (both above and below the digital divide) continue to fare better.

Financial services

We also reviewed the financial services industry (FSI) – traditional banks existing primarily in the Service Provider quadrant, plus digital wallets, payment processing companies, and other niche fintech entities in the Technology Creator and Network Orchestrator segments. For traditional banks, instead of the RMx multiple we considered the Price-Revenue multiple (PRx), which compares market capitalization with revenue. This is because traditional banks have no enterprise value; instead, market capitalization is considered a metric of valuation. For fintechs and other financial services companies, however, we considered the RMx multiple. As with hospitality businesses, banks and financial institutions that explored technology-based business models above the digital divide are in a better position to build higher value.

From our RMx analysis, we observed that fintech and technology companies (operating as Network Orchestrators) are disrupting the FSI by targeting traditional banks’ sources of revenue. The difference in business models of traditional banks (Service Providers) and fintech companies (Network Orchestrators) has led to a disparity in Revenue Multipliers. Furthermore, the proliferation of digital wallets – from both fintech companies and new tech-sector entrants – is cannibalizing interchange fees earned by banks, as well as



their deposit amounts. While traditional banks are trying to leverage digital initiatives, most are focusing on “technology-in-the-business,” with a goal of enhancing the consumer experience and increasing operational efficiency.

We reviewed the FSI in light of the COVID-19 pandemic, finding that the role of fintechs is becoming more important as people move away from cash and into digital wallets and payments processing. The high valuation of some digital wallet companies, even without traditional banks’ profit legacy, highlights investors’ confidence in the potential value of a “digital-imperative future” for finance.

In the example below, we looked at two traditional banks, a credit card company, and a digital wallet company. Those with greater business model diversification showed higher resiliency and faster recovery.

Companies A and C Company B Company D

Both companies generate all revenue from business models below the digital divide

Generates a majority of its revenue from business models above the digital divide, with a small percentage of revenues coming from business models below the digital divide

Generates a majority of its revenue from business models below the digital divide, with a small percentage of revenues coming from business models above the digital divide

Figure 9. Percentage change in market capitalization during the first six months of the COVID-19 crisis, financial services industry

Company B showed the resiliency and tenacity needed to potentially recover, given its business model mix, which primarily leverages technology-as-the-business. Like Companies A and C, Company D is a traditional financial



services company, but it fared better due to its safety net of diversified business models.

Industrial manufacturing

Broadening the scope of our case studies beyond the current crisis, we looked at industrial manufacturing over the past five to 10 years. This traditionally tangible-asset–heavy industry comprises larger conglomerates and smaller niche companies. Over the past few years, a focus on technology investment has grown with the adoption of automation, progressing from Industry 3.0 (automation of routine, high-volume transactional tasks) to Industry 4.0 (using IoT, cloud computing, data analytics, and AI to automate complex tasks).

Seen through a Revenue Multiplier lens, however, we consider many of these advances as “technology-in-the-business,” with a focus on process efficiency, cost optimization, and enhanced customer experience leading to some incremental gains in the ability to build value. We found a few industrial manufacturing companies with some businesses leveraging intangible assets, but asset contribution was either insignificant or not concentrated enough to affect core business models and associated RMx.

A few industrial manufacturers, however, deviated from this path, exploring opportunities to monetize existing technology-in-the-business investments, building newer revenue streams by converting them to “technology-as-the-business.” A small number built an edge in technological niches and, over time, transitioned from industrial manufacturing companies to industrial and manufacturing technology companies.

A handful of other companies built value by identifying parts of their businesses that had the potential to move above the digital divide. They focused on building these technology-as-the-business revenue streams and eventually spun them off as separate companies (as a faster way to realize value). The transition from technology-in-the-business to technology-as-the-business has been comparatively slower in industrial manufacturing, yet the trend is growing, with significant opportunities to drive meaningful value through acquisition or building new businesses, thereby creating business model diversification.

Toy manufacturing

Consider three toy companies we reviewed. Two toy manufacturers moved away from a tangible asset-centric business model to one based on both tangible and intangible assets. The third company remained largely a manufacturer, with a lower RMx over the years.

One of the companies started as an assembly-line toy manufacturer and transformed itself into a media and licensing company. This traditional toy manufacturer changed its business model mix from predominately Asset Builder



to a combination of Asset Builder and Technology Creator, through a series of strategic mobile gaming and licensing acquisitions, along with alliances with top Hollywood studios to create movies and videos based on its brands. Compared with competitors that retained legacy business models, it has been rewarded with higher Revenue Multipliers, and much higher valuations, growing its Revenue Multiplier from 1x to over 3x in 10 years.

These examples reinforce the relevance of business model diversification; the two successful toy manufacturing companies retained a focus on their core businesses while exploring opportunities in technology-based business models above the digital divide.

The Impact of BMD Study Insights on the Great (Country) Race

In addition to looking at RMx and BMD from an industry perspective, we also investigated how these principles applied to the economies of entire countries. We found similar value creation implications for heads of governments and country leaders.

Our 2018 Great (Country) Race publication3 looked at the relationship between a country’s GDP and the business models it supports. For that study, we classified economic activities by business model type (using the RMx framework) and evaluated parameters pertinent to each economic activity (e.g., IP protection) in three separate studies covering a period of seven years in total. We observed that countries that support technology-based business models above the digital divide, without ignoring those below it, have positive GDP growth. Those countries only supporting below digital divide business models, have declining GDP.

As company leaders consider how to invest in future growth, the importance of Technology Creators and Network Orchestrators cannot be denied. The strong growth and profitability of these models, their resilience in downturns, and their relationship to national GDP are all critical reasons to consider adding to and investing in them when building for the future. What policies can governments use to speed economic recovery and enhance wealth creation? What does it look like for country leaders to work with business leaders to build an ecosystem that supports growth of technology-based business models in areas such as fintech and e-commerce and more traditional industries as well? Government leaders could look to modernize policies and enable new tech-based business models, creating economies that not only support GDP growth but also show resilience and tenacity in times of crisis.

3 The Great (Country) Race: Company Business Models and Country GDP – Opportunity or Threat? William J. Ribaudo and others,

Strategic News Service Global Report, September 2018. https://www2.deloitte.com/content/dam/Deloitte/us/Documents/finance/company-business-models-country-gdp-opportunity-or-threat%20.pdf



Putting Our Findings to Work in Times of Crisis and Beyond

Our previous papers discussed how markets have bifurcated value between new and traditional business models and found that newer business models — those above the digital divide (that leverage intangible assets) — are typically more highly valued.

As the pace of technological change and digital adoption accelerates, we’ve seen a rise in Technology Creators and Network Orchestrators in the S&P 500. Crisis often accelerates technology adoption, as strong companies manage risk and exploit opportunities to take advantage of market disruptions. For example, social distancing requirements brought about by the COVID-19 pandemic have dramatically accelerated the substitution of video calls for in-person meetings and doctor’s appointments, and online orders for in-person grocery shopping. Users are likely to continue using these platforms, even after the pandemic passes.

Investors see the merit of using business models above the digital divide to create agile, digitally-based revenue streams and to monetize existing technology and IP investments “as-a-business.” This market capitalization shift is evidence of investor confidence in the value-building potential of technology-based business models in both strong and uncertain economic seasons.

As our research shows, even in times of uncertainty, the companies that are best poised for success, typically showing the most resilience and ability to create the most value, are those with a mix of business models above and below the digital divide. Companies with the ability to do so should consider diversifying their business model portfolios to help improve their growth prospects and better insulate themselves from market disruptions. These approaches can create safety nets, enable companies to better manage risks, and enhance potential value creation.

Conclusion

In both bust and boom times, we believe that the merits of business model diversification – supporting models both above and below the digital divide – can deliver faster recovery from crisis, stronger growth prospects, and higher market capitalizations, while serving as a way to risk-proof corporate strategy. For companies below the digital divide, building or buying business models above the digital divide may be a powerful way to reduce risk to your strategy. Businesses that attract the most value will likely continue to be those that seize the opportunity to reallocate capital and mitigate risk across multiple business models … and win The Great Race.



About William J. Ribaudo

Bill Ribaudo is an author and frequent international speaker on digital business model innovation and its link to market valuation. Bill’s research has been published in the Wall Street Journal, Knowledge@Wharton, Deloitte CFO Insights, and the Strategic News Service Global Report. He has been a featured speaker at engagements including the 2018–2019 Central European Economic Forum (Krynica, Poland); 2019 OECD (Organization for Economic Co-operation and Development) World in

Emotion Forum; CES 2018; LinkBridge Investors Global and Regional Conferences; International Economy and Technology 4.0 Conference; The Intelligent Enterprise Conference; 2015–2019 SNS Future in Review (FiRe) conference; 2017–2019 SNS Predictions East; BBC Radio; Business Radio on Sirius XM powered by the Wharton School; The McCuistion Program on PBS; the Czech Institute of Informatics, Robotics and Cybernetics; and the Dallas Annual Governance Symposium at the University of Texas.

Bill is a senior advisory partner to some of Deloitte & Touche LLP’s most strategic clients. He previously led Deloitte Risk & Financial Advisory’s Digital Risk Venture Portfolio, where he oversaw investments and services designed to help clients drive digital and business transformation. Bill led Deloitte Risk & Financial Advisory’s Technology, Media, and Telecommunications Industry practice for many years. He has more than 35 years of business experience, including in public company executive leadership, financial management, and strategy consulting. He is a member of Business at OECD’s Digital Economy Policy committee and a board member and the Treasurer of the Massachusetts High Technology Council.

About the Co-Authors

Seema Bajaj

Seema Bajaj leads research and insight development for Revenue Multiplier. In addition to directing Revenue Multiplier research, Seema serves clients, helping executives to see new opportunities, mitigate associated risks to and from their strategy, and begin their journey to shift business models to attain higher shareholder value.

[email protected]

[email protected]

mailto:[email protected]




Parikshit Sinha

Parikshit Sinha leads the research efforts for Revenue Multiplier and is focused on providing critical thinking and tailoring the framework for a wide range of audiences. He co-led portions of a business development workshop with Bill and Aditya in Sweden in October 2019.

Aditya P. Singh

Aditya P. Singh develops research-backed original opinion and insights to tailor the Revenue Multiplier framework for multiple audiences and uses. He co-led portions of a business development workshop with Bill and Parikshit in Sweden in October 2019.

____

This document contains general information only and Deloitte is not, by means of this document, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This document is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. In addition, this document contains the results of surveys conducted by Deloitte or its affiliates. The information obtained during the surveys was taken “as is” and was not validated or confirmed by Deloitte or its affiliates. Deloitte shall not be responsible for any loss sustained by any person who relies on this document.

As used in this document, “Deloitte” means Deloitte & Touche LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of our legal structure. Certain services may not be available to attest clients under the rules and regulations of public accounting.

Copyright © 2020 Strategic News Service and Deloitte Development LLC. Redistribution prohibited without written permission.

Your comments are always welcome.

Sincerely,

Mark R. Anderson

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