The circular economy (CE) concept is much-heralded among policy-makers, scholars and industry professionals as an accelerated pathway towards sustainability. This move away from the dominant linear system where products are discarded at the end of product lifecycle is deemed necessary since it is the main cause of an accelerated resource consumption. Business models are considered as a key enabler for the shift from a linear to a CE. However, research on circular business models has mainly focused on circular approaches adopted by incumbent firms, while the contributions of newly established firms (the authors call these 'circular start-ups') have been largely overlooked. This article scrutinises the business models of circular start-ups and how they may differ from those of incumbent firms embracing CE. For this, it analyses the circular business model strategies and innovations adopted by circular start-ups, relying on a novel data sample of 128 circular start-ups identified in three major CE ecosystems in Europe: the Randstad region in the Netherlands, Berlin and London. Based on this data, a novel typology of circular start-ups is proposed, distinguishing between five circular start-up archetypes: design-based, waste-based, platform-based, service-based and nature-based start-ups. The results also show that circular start-ups tend to embrace strategies corresponding to higher levels of circularity than those of incumbents. This preliminarily suggests that circular start-ups can indeed make major contributions to transitioning towards CE.
The circular economy (CE) is now widely seen as a key concept to drive sustainability transformations. Existing research on circular business models has tentatively indicated that circular entrepreneurship may be able to play a pivotal role in the transition process. However, grassroots activity in CE has not yet received substantive scholarly attention, nor have the founders of circular ventures. This study attempts to start closing this gap by presenting the first empirical analysis of circular founders' motivations and identities. Our work is based on interviews with 57 founders of circular start-ups in Europe and Australia. The analysis reveals distinct characteristics for these entrepreneurs. We find that noneconomic motives are dominant drivers of grassroots circular entrepreneurs while they include a triple bottom line orientation (i.e., economic, social, and environmental value) in principle. Yet, circular start-up founders barely formalize socio-political dimensions in their activities despite being motivated by social altruism. Furthermore, circular founders have an inventive mindset when starting their entrepreneurial journey, possibly driven by their limited market-oriented positioning, limited entrepreneurial experience, and managerial education. However, their scaling ambitions grow significantly over time, as opposed to social and sustainable entrepreneurs. Overall, our findings suggest adding grassroots circular entrepreneurs or circular founders as a distinct group of sustainability entrepreneurs to the scientific discourse on sustainability-motivated entrepreneurship and circular innovation studies.
| INTRODUCTIONThe relevance of the circular economy (CE) for creating a sustainable future in which economic growth can be decoupled from excessive resource depletion is much discussed-and contested-in recent sustainable development literature (Calisto-Friant et al., 2020;
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