How start-ups can make the Circular Economy become reality

Written by: Miriam Kehl | Published:
Miriam Kehl, advisor to the board of Landbell and associate director at Green Alley Investment

Miriam Kehl, advisor to the board of Landbell and associate director at the Green Alley Investment which promotes start-ups for their innovative ideas in the area of recycling, resource conservation and recycling management, explains how start-ups all over Europe can help make the Circular Economy a reality

As raw materials are scarce worldwide and are becoming increasingly expensive, companies that save resources or produce gently do not only contribute to a cleaner environment but actually have a real competitive advantage. The European Commission, which is currently working on the EU Circular Economy Action Plan, estimates that waste prevention, eco-design, reuse and similar measures could save companies within the EU between €250 and €465 billion annually in raw material costs.

Currently, many European countries are still struggling to reach EU targets or to fulfil the latest standards in waste management. The call is getting louder, but so far, action seems to be missing. Hopefully not much longer, as a new generation of people, often called millennials, digital natives, Generation X or simply “founders” have committed themselves to the problem. They have realised the issues and have started embedding Circular Economy deep into their business models.

Circular Economy – more than just recycling

It is not enough to think about recycling. What we need are new business models around sharing, repairing, reusing and remanufacturing in all sectors of our economy: e.g. e-commerce, fashion, energy and even in the building sector. The good news is these ideas exist already.

However, many of the start-ups that are tackling environmental issues need assistance and guidance to enter the market or scale their products and solutions. What drives them is the belief that they can change something. And that’s why we founded the Green Alley Investment. During the past years, we have been approached by over 800 business. The continuously growing amount of applications and its diversity of topics are proof that we are on the right path transitioning towards a Circular Economy. As the area is huge, there is enough potential to be creative and to change something.

One of the areas that this new generation sees as a major environmental problem is packaging, due to the massive increase of e-commerce all over the world. By weight, packaging is responsible for over 3% of all waste generated in the European Union. It actually includes all sorts of materials: cardboard, glass, plastic, wood and metal – while cardboard is the most used one. Even though the EU has managed to recycle 65% of packaging in 2013, there is still room for more.

The Finnish start-up RePack, winner of the Green Alley Award 2014, has made it its mission to reduce packaging in the fast-growing e-commerce business. The team around Jonne Hellgren has developed a new type of shipping bag made out of fully recyclable materials, which can be taken back via a multi-path system and used several times by the customer. This is possible through a pledge, which returns to the costumer in form of vouchers for cooperating online shops.

Green City Solutions, winner of the Green Alley Award 2016, is realising innovations based on the concept of “Smart City”, which means combating and eliminating problems like high emissions, high energy cost and air pollution through new and smart technologies. Increasingly, cities have to take measures against air pollution, like driving bans and creation of parks. Green City Solutions has now come forward with a new idea: a detached wall covered with mosses on both sides. These mosses swallow fine dust and convert it into biomass. The wall under the name "City Tree" absorbs 240 tonnes of CO2, equivalent to almost 300 trees.

Another area that urgently needs some great circular economy solutions is the building industry. It creates some of the biggest amounts of non-recyclable and toxic waste. It starts with the plasterboards made out of gypsum that is usually used for the separation of rooms in each house. When these boards reach landfills – and it does so in vast quantities as it constitutes about 15% of all construction and demolition debris – it can leach these toxic chemicals into our groundwater. And in the anaerobic conditions of landfills, bacteria convert gypsum into hydrogen sulphide, a poisonous gas. Adaptavate, winner of the Green Alley Award 2015, has been working on a solution to not use these toxic plasterboards in the first place. The British start-up has developed a 100% recyclable wall called 'Breathaboard', which is made from agricultural waste and is a sustainable alternative to conventional wall claddings made of gypsum.

Good ideas need strong partners

Looking at all three start-ups above, they have great ideas to contribute to building up a circular economy. And yes, good ideas make a good start. However, introducing new products and technology to the market without any experience can be a hard challenge for young founders. Therefore, it is not only the financial assistance they need, but a partner, who points out obstacles at an early stage and brings in many years of expertise. RePack, Green City Solutions and Adaptavate all have one thing in common: they need to work on their business models and make their idea scalable. For that, they need partners such as Green Alley.

Besides our yearly award, which showcases the best ideas in the Circular Economy, we connect start-ups with established companies and mentors across various industries. We believe that in order to successfully establish a Circular Economy, all sectors of our economy need to be engaged and need to change their current way of doing business. If every start-up and company begins to implement the idea of a Circular Economy in its business model, the term "waste" will no longer exist as all resources are kept in circulation.

Find more information about the Green Alley Award at

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