Local startups embark on

Local startups embark on EU Green Deal mega-project

The circular economy is an emerging sector that supports startups creating new models that recycle and reuse materials in supply chains and consumer industries. We’re seeing such entrepreneurial initiatives appearing locally as well, and their development will only accelerate as the European Union needs around EUR 7 trillion worth of investments to become climate-neutral by 2050 under the Green Deal.

By Ovidiu Posirca

EU: The transition to a more sustainable economy is critical as annual waste generation is projected to increase by 70 percent by 2050

The sector is ripe for innovation, with the EU estimating that some 700,000 new jobs could be created by 2030 by applying circular economy principles. Startups are encouraged to build innovative solutions based on closer relationships with customers, mass customisation, a shared and collaborative economy, all powered by digital technologies, says the EU in its circular economy action plan.

Eliminating net greenhouse gas emissions by 2050 will need public and private invest-

ments of EUR 3 trillion in utilities to build renewable energy assets and upgrade power grids, according to Goldman Sachs.

STARTUPS CREATING GREEN JOBS Companies’ sustainability strategies will also be integrated in this joint effort carried out in the EU. Entrepreneurs can also play a key role in building the economy of the future.

“Without Romanian entrepreneurship, our move towards Sustainability 2.0 or 3.0 will be much slower. It should be our responsibility as entrepreneurs and foreign investors to support local education and startups,” said Ionut Georgescu, founder & co-CEO of FWEI, during BR’s Foreign Investors Summit 2020.

PolyMore is one startup founded by a team of students in Timisoara that uses artificial intelligence to optimise the management of plastic waste. Their technology primarily focuses on industrial waste and plastics used in electronics.

Elsewhere, ECOTREE raised EUR 225,000 through equity crowdfunding on SeedBlink. The startup is building a digital platform aiming to streamline the monetisation of waste recycling considering that Romania only recycles 13 percent of waste it produces.

By early 2020, Evertoys Romania had raised USD 331,300 for its toys-as-a-service project. Its business model is based on the growing trend of sharing economy and recurrent income, targeting medium and highincome urban families with children aged 1 to 14.

Meanwhile, Lizit has created a gadget leasing platform for companies and individual users. Following an initial investment of EUR 75,000, the startup generates revenue from subscriptions paid by users and the sale of gadgets at the end of their usage cycle.

“With the exception of a few examples, circular economy companies hold an insignificant share of total business activity. However, circular principles are being adopted by big players in various industries who are willing to reinvent themselves, eager to meet their customers’ expectations or being pushed by new regulation,” Matei Dumitrescu, senior investment partner at ROCA X, an early-stage startup investment fund, told BR.

“The common mindset here is that circular principles only apply to non-profits and not to sustainable and profitable ventures. (…) It will all evolve and improve the more people are be able to share, to reuse, to reinvent, and even to pay more for a greater societal good,” he adds.

The EU says that the circular economy can work in key value chains ranging from electronics and IT to batteries, textiles, and construction.

The transition to a more sustainable economy is critical as global consumption of materials such as biomass, fossil fuels,

metals, and minerals is expected to double over the next forty years, while annual waste generation is projected to increase by 70 percent by 2050, according to the action plan published by the EU.

EUROPEAN STARTUP IDEAS DISRUPTING CIRCULAR ECONOMY Across Europe, there are numerous startups which are building new models that can be easily integrated into the circular economy.

London-based Aeropowder is developing new materials from surplus feathers, which are among the lightest natural fibers and efficient thermal insulators. It has already launched the first thermal packaging material made from surplus feathers that can replace conventional polystyrene.

Having raised EUR 2.9 million to date, Sulapac is a Helsinki-based startup that created a biodegradable alternative to plastic. Their product can be processed with existing plastic manufacturing machinery, which can boost adoption rates.

In Denmark, Too Good To Go has raised EUR 16 million to expand its platform that allows people to buy surplus, unsold food from restaurants or supermarkets that would otherwise have to be thrown out. The startup is on track to save 20 million meals per year, according to eu-startups.com.

Worn Again has developed a polymer recycling technology that can convert worn clothes, as well as plastic bottles and packaging, into raw materials. The startup got GBP 5 million in funding from fashion retailer H&M to develop the initiative.

In Barcelona, Re-circula Solutions developed a digital waste management and collection system for urban areas and pharmaceutical waste. The startup aims to cut the amount of waste produced in Europe, nearly 35 percent of which ends up incinerated or in landfills.

Dutch blockchain startup Circularise got EUR 1.5 million in EU funding to track plastics from initial resin to end-product. Data on plastics coming from QR codes or chemical tracers are fed into the blockchain.

The EU is becoming a key backer of these startups as it has a budget of EUR 150 billion for circular economy projects. The investments contribute to new business models, increased recycling, energy efficiency, and the creation of green jobs.

Going forward, the European Commission, the executive arm of the EU, will support the creation of pan-European clusters in sectors deemed to be priorities, including the circular economy and advanced manufacturing.