Meet 16 Startups Leading the Circular Economy Transformation
The circular economy transformation is seeking to remedy unintended consequences and negative externalities like pollution, waste, ecosystem destruction and resource loss that our current linear economy creates. It’s a global movement that startups, governments and established companies are actively participating in, or working towards.
The circular economy is achieved by redesigning businesses, goods and services, as well as creating new ways of delivering value into the economy without waste and pollution. The main goals are to eliminate waste, keep things in the economy longer and regenerate nature. It requires business model transformations and support from governments in the establishment-shared and universal systems that enable the cycling of goods back through systems that eliminate waste. This goes well beyond recycling; in fact, recycling is a lower-level solution in the circular economy. Whilst recycling is important, under the current system it validates the production of waste. In this article, you will find a breakdown of different approaches to the Circular Economy and cool startups helping to make it happen.
The future is circular, not just in the bigger economy, but also in our daily lives. The linear economy has helped us advance to where we are today, but the advancement has come at a significant cost to the environment, which in turn affects our health and quality of life as we try to address a myriad of issues from climate change, air pollution and loss of biodiversity.
There is so much scope for innovation in this emerging space too — doing more with less, cycling materials around the economy as services and reuse models, collaborating with adjacent businesses or even direct competitors and working with customers to design highly effective experiences that allow for ongoing relationships and services provisions are all approaches to activating circularity.
By switching up a company’s profit model and value proposition, profits can be generated without costing the Earth. Repair infrastructure, service and reuse models, remanufacturing and reselling are all part of this transition. The key is figuring out what will work within your industry, product category, location of production and sale, as well as staying on top of new innovations in materials and technology.
Circular Economy Business Approaches
The business model is the backbone of any successful company, and so the key to transitioning to the circular economy is changing the business model. This requires us to shift the way we design products and services to fit into circular models of consumption and production. This means that there is a crossover between the strategies we use to design circularity and the models we use to create value in the economy.
Since nearly every company sells something in some form, the design of these products and services is a critical part of the transition to circularity. Products move through different cycles like reuse, repair and remanufacturing. As you consider the examples below, start thinking about the shifts that you could make in your organization to take on more circular approaches. And then download our new Swivel Skills free Circular Business Redesign toolkit to get started on redesigning your approaches.
“A circular business model articulates the logic of how an organisation creates, offers, and delivers value to its broader range of stakeholders while minimising ecological and social costs.” — Sustainability Guide
16 Circular Economy Startups Helping to Disrupt the Linear Economy
Here are 16 interesting circular economy businesses that are disrupting the status quo and experimenting with new business models based on the circular economy. They are presented under a different theme of the circular economy approach.
PRODUCT AS SERVICE MODELS
One of the main ways that products are designed to fit within the circular economy is through reuse systems called “Product as Service” or “Product, Service, Systems” models.
This is when a product is redesigned to fit within a larger take-back system that enables the product to be delivered as a service over and over again. These are at-scale reuse systems that enable usually disposable items like food packaging to be reused many times. Usually, the company remains the owner of the products and designs the delivery and take-back system. Critical to this is asset management and technology that enables the take-back.
Rentle: A service that makes anything rentable by providing rental software, inventory management and sales channels, Rentle is intended to support moving from linear to circular sales.
Homie: Homie pay-per-use provides energy-efficient household appliances in which you pay for the use, not the ownership. With flexible subscriptions, they offer repairs and move with you, allowing people to rent household items as a service.
Circuly: Circuly is a software solution for managing, automating and scaling operations of a subscription-based business model for physical products.
MAKING IT LAST LONGER
This circular approach entails creating products within a closed-loop system where they are intended to be taken back, reconditioned, or fed back into the production cycle to create new high-value products. It challenges the traditional model of lots of customers buying individual units by offering higher-value, longer-term products and ensuring they are utilized — this can involve repair and remanufacture, supporting resale markets, or offering upgrades.
Eon: This company offers unique Digital IDs for products to track and manage them across the full life cycle, which makes it easier to extend the life of products and resell them.
Olio: A UK-based mobile app, it connects neighbors for sharing by giving away, getting, borrowing or lending things for free within your community, aiming to reduce household and food waste.
Sojo: This is a direct-to-consumer platform that connects customers to local seamstresses for repair. Items are picked up and dropped off by a bicycle courier, and Sojo offers services to businesses as well.
PRODUCT REUSE SYSTEMS
Products are delivered as closed-loop reuse systems, whereby a currently disposable item is redesigned, diverted from disposability and converted into a reuse model.
One example is replacing disposable and single-use items such as packaging with managed assets that people borrow and then return for refilling. Often, technology is a critical part of the reuse system since assets need to be managed, collected, cleaned and redeployed efficiently.
This is connected to the sharing and subscription models we have covered already, but in this case, we will single out examples of single-use items being converted into reusables and diverting products away from landfill.
Reath: Offering reusable packaging solutions for businesses, their software helps businesses launch and scale reusable packaging systems. Their platform creates “digital passports” to track physical items.
Again: This is a business offering shared infrastructure for reusable packaging by building a distributed network of hundreds of autonomous cleaning facilities called CleanCells. Each facility processes and cleanses packaging for use by the world’s largest FMCG brands.
Loop: A partnership between Terracycle & Unilever, they work with retailers to deliver products such as ice cream and sauces in specially-designed reusable packaging that customers return each time they reorder. The packaging is then sterilized, refilled and redeployed by the producer.
INDUSTRIAL RECYCLING AND RESOURCE RECAPTURE
This circular strategy entails recovering previously abandoned resources, such as mining landfills or extracting materials from old technology, and getting valuable resources back into the economy to ensure that they are circulated back into the system. Food waste collection services and industrial resell apps are common examples of this.
Mint Innovation: This company offers low-cost recovery of valuable precious metals from waste streams like electronics. They use natural biomass and smart chemistry to extract metals from waste commercially, accelerating circular supply.
MiAlgae: By using a co-product from the whisky industry that is highly nutritious, MiAlgae grows algae and creates omega-3 to eliminate reliance on wild-caught fish.
Lehigh Technologies: They turn waste tyres and rubber waste into micronized rubber powder which can be used in a wide variety of applications, from new tyres to plastics, asphalt and construction material.
SHARING SERVICES
This could be done as a physical space (like a library that people visit) or as a digital service (such as an app). The core approach is to connect people to the products that deliver a service as they need them, or to offer a space for people to share resources between them (peer-to-peer networks). One of the key aspects of peer-to-peer sharing services is trust, and for company-managed sharing, it’s more about product quality and ease of access. How can it be made so that instead of going and buying a new drill, the act of leasing it is easier and more convenient?
Bundlee: A circular subscription baby clothes service that offers quality baby clothes on loan to customers, they send it back and get a new box as the child grows, and clothes are washed and redeployed.
Library of Things: This concept allows people to borrow useful things for the home, projects and adventures, offering affordable and convenient things like hedge trimmers, pasta makers and sewing machines on lease per hour, day and week.
Christmas Tree Rental: Pot-grown Christmas trees are delivered for the festive season and then collected when it’s over. The trees are returned to a farm, where they keep growing and then are reused every year.
Tulerie: A peer-to-peer luxury fashion-sharing platform, Tulerie allows people to list and rent their fashion items to other people in the network for a fee.
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If you want to learn more about circular economy business models and take action to join this global movement to design out waste and pollution, then sign up to Swivel Skills today. The UnSchool has a short course and 6-week sprint to activate circularity, and you can download our new free toolkit here.
I’m also running a deep dive into Sustainability in Business in October; it’s a 4-week live online program that will go into detail on the circular economy, as this is a key part of activating sustainability.
