Insights and impulses on sustainability in start-ups

In autumn / winter 2019, in cooperation with the University of Vienna and the University of Nottingham, the strategy consultancy Kleinundpläcking from Berlin interviewed over 20 sustainable start-ups from four different countries to find out what the situation is like for young, sustainable companies. The start-ups came from a wide range of industries such as FMCG, fashion, farming, infrastructure, cosmetics, energy, and many more. Nine crucial core insights for BRAND, INNOVATION and GROWTH stand out:

Sustainability is not a trend, but a rethinking.

Sustainability has become an irrefutable trend in recent years. The current social movement is a fundamental rethinking in the minds of many, which is also becoming politically visible through movements like Fridays-for-future. Ecological sustainability will be a hygiene factor for the following generations, without which most offers will not be acceptable at all. A rethinking that remains.

Sustainability is difficult to communicate.

The added value of a sustainable offer often requires a higher level of explanation. Customers often have to pay extra or rethink what they have learned when switching to sustainable offerings, which often makes it difficult for sustainable companies (especially start-ups). It is therefore important to address explicit target group insights. This uses the limited resources most efficiently in the struggle for the attention of the target group.

Founders have to live values authentically.

Start-up founders in particular are the personification, the figurehead of their company. Therefore, corporate values and ideals must be authentically reflected and lived by the founders. Authentic does not mean naively idealistic; on the contrary, realistic, disruptive, self-critical and honest.

Easier financing for sustainable start-ups.

Financiers, business angels, but also public funding and private individuals are currently generous. Green and social start-ups benefit from the trendy topic of sustainability, but also from the conscience of the benefactors. Sustainable start-ups therefore currently find it relatively easy to collect funds; a fact that increases the risk of greenwashing by 'conventional' start-ups.

Sustainability has different characteristics

Sustainability does not only mean eco-friendly. Sustainability consists of different dimensions - an ecological, social, but also economic dimension. While ecological sustainability is often the absolute focus of sustainable start-ups in the beginning, social (including responsibility for direct and indirect stakeholders) and economic sustainability (including stable, independent company financing) also become increasingly important as the company grows. Ecological, social and economic sustainability are not in conflict, but they often contain potential for conflict.

THE sustainability does not exist.

If you rethink existing concepts and offers, you will quickly realize that, on the one hand, it is always possible to be better and more sustainable, and on the other hand, the positive effect in one area usually leads to a negative effect in another one. There is never only black and white in sustainability, there are no absolutes, there is only better and worse.

You have to be able to afford sustainability.

Green and sustainable consumer behavior remains a privilege of an affluent society and a class of higher earners. Only when individual material and social concerns decrease, will the ecological responsibility increase in action and consumer behavior.

Target groups for sustainable products are globally similar.

Target groups that put importance in sustainability usually differ only psychographically. These target groups come from all social classes, are independent of age and gender, and know no national boundaries. Regardless of the country: The target groups are similar - cosmopolitan, progressive and very critical.

Sustainability alone does not sell.

Customers today are not willing to spend significantly more money on sustainability alone. There always needs to be an additional benefit. Cost savings, better quality, additional features or innovative simplicity. Today, sustainability is a nice-to-have add-on, but soon it will become a hygiene factor.

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