Red Bull

Red Bull has a business model based on cross-subsidy. It markets an outsourced product, to cross-subsidize its business based on extreme performance.

Take a look from this source [1]:

This piece on Red Bull in the Generalist was enough to make me subscribe, all by itself. I can’t recommend it enough. But if you don’t want to pony up the $$$ (it’s not cheap) the takeaway that’s important for our purposes is this:

As Geof Rayner, a Professor at Brunel University, summarized:

“Red Bull is an interesting case because they don't make anything at all. It's an Austrian marketing company... that's it!... It is just a brand. Without any manufacturing plants or anything!” . . .

Rather than manufacturing its core product, Red Bull outsources, relying on partners like Rauch, a juice producer. That allows [Red Bull the company] to focus on what it does best: marketing.

Over time, that's created a peculiar company, hell-bent on dominating the cultural conversation but disinterested in its actual product. Like one of Darwin's long-beaked finches, Red Bull bears the marks of a business with one specific attribute selected for over and over again: garnering attention.

OSE Learnings

Red Bull engages in cross-subsidization. Cross-subsidization is a common business model. In the broadest sense, it applies to any organization which gets its revenue from another source than the core work.

OSE is evolving to a cross-subsidy business model, where revenue from enterprise, such as the Seed Eco-Home, cross-subsidizes further development of the Global Village Construction Set in its v1.0, v2.0, and v3.0 executions. Read more details about this at GVCS