Five elements that make a business

First published:

Last Edited:

Number of edits:

What defines a business? In [[literature/@kaufman2020|@kaufman2020]], there are 5 things that must exist for something to be defined as a business:

  1. Creates and delivers something of value
  2. That other people want or need
  3. At a price they are willing to pay
  4. In a way that satisfies the customers' needs and expectations
  5. So that the business brings enough Profit to make it worthwhile for the owners to continue operations

I think it is a very reasonable approach to defining what a business is.

Interestingly, it even works for startups that survive on investment. They are selling themselves (or parts), for a price investors are willing to pay.

I wonder how this works out in the case of subsidies, when the state gives money but they don't get anything in return (at least not directly).


Share your thoughts on this note
Aquiles Carattino
Aquiles Carattino
This note you are reading is part of my digital garden. Follow the links to learn more, and remember that these notes evolve over time. After all, this website is not a blog.
© 2021 Aquiles Carattino
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License
Privacy Policy