How Do Start-Ups Develop Circular Business Models? A Systematic Literature Review

Circular Economy (CE) models have gained attention in the academic community for their ability to promote sustainability and efficiency in resource use. It promotes advances in the traditional linear economy and offers innovative solutions to environmental issues. In this context, start-ups play a key role in implementing Circular Business Models (CBMs), leading the transition to more sustainable practices and positively impacts on the market and the environment. In the current academic literature, there are relevant studies on the implementation of the CE in traditional companies. Still, discussions on how start-ups transition from linear economy to circular business models remain limited. To address this gap, we conducted a systematic literature review on how start-ups design and adapt the linear economy to their circular business models. Our methodology followed the PRISMA 2020 protocol, thoroughly searching the Scopus, Science Direct, and Web of Science databases, resulting in 42 articles. The findings highlight the crucial role of Circular Start-Ups (CSUs) in the transition to a Circular Economy, identifying the challenges and opportunities they face and the internal and external barriers they need to overcome to ensure long-term sustainability. Furthermore, this study highlights the existing gaps in the literature and suggests key areas for future research.