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The sustainable start‐up paradox: Predicting the business and climate performance of start‐ups
Author(s) -
Leendertse Jip,
Rijnsoever Frank J.,
Eveleens Chris P.
Publication year - 2021
Publication title -
business strategy and the environment
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.123
H-Index - 105
eISSN - 1099-0836
pISSN - 0964-4733
DOI - 10.1002/bse.2667
Subject(s) - exploit , start up , sustainable business , business model , context (archaeology) , sustainable development , climate change , business , competitive advantage , industrial organization , marketing , environmental economics , economics , computer science , sustainability , political science , business administration , ecology , paleontology , computer security , law , biology
Sustainable start‐ups introduce new sustainable technologies and business models that facilitate the transition to a carbon neutral economy. To understand how to create viable sustainable start‐ups, we study what factors predict their business performance and climate performance (i.e., the ability of the start‐up to reduce CO 2 equivalent [CO 2 e] emissions) and if these contradict. A critical factor we consider is technology, which is commonly at the root of climate performance, and important for business performance because it influences a start‐up's competitive advantage. Using a sample of 197 sustainable start‐ups, we find a paradox between business and potential climate performance. Start‐ups that exploit hardware technologies have a lower business performance but a higher potential climate performance. Through the use of mediating effects, we show that the sustainable start‐up paradox is context specific. Start‐ups can partly escape this paradox by focusing on novel and hardware technologies. We discuss implications for theory and practice.