This study analyses how startups implement circular business models supported by innovation and Industry 4.0, in which strategic stakeholders for value creation are to be found in this specific business ecosystem. The theoretical framework of circular business models supported by innovation was used for analysing the startups based on some assumptions of stakeholder theory. Fifty-one startups were selected, which correspond to the unit of analysis for this study on the improvement of supply chains through circular business models supported by innovation aimed at sustainability in organizations. We conducted a multiple case study whose results suggest that: (i) circularity is strategic for the business to assume its commitment to a sustainable development agenda, especially regarding pollution prevention and proactive action; (ii) visionary entrepreneurs are actively engaged with circular economy practices and technological innovation to promote a circular flow for their business ecosystem; (iii) Industry 4.0 is still incipient, but it is synergistic and beneficial for a successful circular economy in startups; and (iv) primary stakeholders are the activators of circular cycles in the startups surveyed. The present study contributes to the literature in four ways by: (i) presenting a framework which brings together exploratory theoretical propositions on strategic stakeholders for startups, innovative capabilities and assumptions of circular business models; (ii) validating exploratory theoretical propositions with 51 startups; (iii) providing lessons learned so far by the startups which are in line with the assumptions of circular business models for triggering their innovation capabilities and promoting Industry 4.0; (iv) providing an original typology of circular economy assumptions and technological innovations adopted by startups. The originality of this study lies in presenting useful insights for motivating managers to: (i) invest in circular business to become one of the first entrants and earn extra profits; (ii) make investments in circular business and technological innovations to obtain efficiency, practicality and process optimization; (iii) internalize Industry 4.0 technologies concomitantly with technological innovations and circular economy to generate systemic effects; (iv) integrate relevant stakeholders of the business ecosystem to generate a synergistic and effective effect for sustainable development.
Keywords: Circular economy; Industry 4.0; Innovation; Stakeholder theory; Sustainability.
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