A new study by researchers at the University of Eastern Finland has explored the role that circular economy startups play in driving systems change, even when demand for sustainable products isn’t guaranteed.
The study, which was published in the Business Strategy and the Environment journal, examined how many circular economy startups develop opportunities in conditions where established market structures don’t always support circular practices, by ‘committing to reducing or minimising their environmental impact, engaging in experimentation, piloting and feedback-driven development, and fostering close collaboration with customers and partners’.
The researchers undertook 31 interviews with startup entrepreneurs, who described the early stage of their ventures, as well as their learnings processes and their efforts to reshape markets.
Market transformation
“Circular economy startups demonstrate that market transformation often begins with values and a desire to fix something that does not work in the current system,” commented research director Ville-Veikko Piispanen of the University of Eastern Finland, the lead author of the study.
“It is remarkable that these entrepreneurs view the vast traditional markets as an opportunity rather than an obstacle. This reflects their readiness for change. It is a positive sign that we have such actors among us.”
The research identifies three recurring practices through which startups tend to operate – a strong commitment to environmental impact; experimentation, piloting and feedback-driven development; and close collaboration with customers and partners.
As a result, a combination of value-driven motivation, coupled with the entrepreneurs’ strong beliefs, enable circular economy startups to challenge establish market practices and convince customers.
‘Agents of change’
“Sustainable startups act as important agents of change by questioning norms, building new models of collaboration and creating conditions for sustainable markets,” added Hanna Lehtimäki, Professor of Innovation Management at the University of Eastern Finland and a co-author of the study. “Their role is crucial as society moves towards an economy based on sustainable circularity.”
The research was undertaken by the University of Eastern Finland Business School and the Research Centre for Sustainable Circular Economy (CECE). Read more here.
