Startups Experimenting with Technology- and Service-driven Sustainable Business Models

Abstract

The transition to the sustainable circular economy is shaping global markets and suggests significant potential for startups to improve economic, environmental, and social performance with technological- and service-driven innovations and sustainable business models (BMs). This requires startups to adjust their sustainable novel offerings and BMs to surrounding business partnerships. However, there is a knowledge gap in the startup literature on how startups have developed and refined their BMs through experiments with partnerships and identified their value creation logic toward sustainable transformation. To address this gap, we present a multiple case study of six sustainable startups that looks at how they have developed their BMs through iterative and processual collaborative experiments. The results reveal that sustainable startups experiment by both developing elements of their BMs and their sustainability impact through input from diverse partnerships. With their innovative technologies and services and co-created BMs, they can contribute to their surrounding networks by adapting their businesses either incrementally or radically. Based on the results, we present a matrix model of BM development path archetypes for sustainable startups. These insights can help both startup and mature companies to develop their own BMs by experimenting and ensure their sustainability and innovativeness impact.