Scaling Circular Economy Innovations – Lessons from early-stage innovators in LMICs


Purpose of this report

Since 2020 the FT Hub has funded a number of circular economy-focussed pilots and grants. These have ranged from supporting the COVID-19 response and recovery through more localised and resilient production and more recently, experimenting with the production and use of bioplastics in Nepal and  testing whether agricultural waste can be used to create silicon in Malaysia

This report shares the FT Hub’s learnings from these pilots. We have found that there are some common factors, unique to the circular economy, that effect an innovation’s chances of scaling beyond an early stage. The hope is that donors, investors and innovators who are interested in building a more circular economy can benefit from these lessons in their work.   



What’s in this report

Based on a desk review and interviews with FT Hub partners working on circular economy solutions, this report identifies key enablers and barriers to scaling early-stage circular economy innovations in LMICs. It provides an  analysis of each enabler and barrier, followed by recommendations for innovators and donors. The report concludes with a curated list of resources for readers seeking deeper insights.

Key factors affecting scaling for early-stage circular economy innovations

  • Access to finance is a major barrier for early-stage circular economy innovators in LMICs due to high upfront costs for equipment, materials and other inputs required for circular solutions. Impact funds and financial institutions often require clear short- to medium-term returns, which are difficult to demonstrate. Grants for purchasing productive assets like machinery can be transformative. 

  • The Policy and Enabling Environment: Many governments have circular economy strategies, but ineffective implementation limits their impact. Early-stage innovators cannot rely solely on policy frameworks alone to scale or build viable business models. When it comes to implementation, many policy environments still favour activities in the linear economy. However, emerging sustainability rules in trade and investment policy may offer future opportunities for those who stay informed 

  • Innovative partnerships help early-stage circular economy innovators boost revenue, access expertise, and expand market reach. Partnerships include joining accelerators or collaborating with businesses focused on decarbonisation their supply chains or enhancing their sustainability credentials on things like plastic packaging. Aligning with government priorities can also accelerate access to resources and networks, supporting faster scaling and broader sustainability goals. 

  • Value proposition: A compelling value proposition is crucial for early-stage circular economy innovators in LMICs, as sustainability credentials alone are unlikely to ensure market success. High price sensitivity and limited awareness of environmental issues, such as plastic pollution, mean that products must focus on achieving competitive pricing and quality. Furthermore, a lack of common standards makes it difficult for innovators to substantiate their environmental claims, posing additional challenges 

The report includes recommendations to donors and innovators on how to navigate these enablers and barriers.


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Publish date: 24/03/2025

Frontier Tech Hub

The Frontier Tech Hub works with UK Foreign, Commonwealth and Development Office (FCDO) staff and global partners to understand the potential for innovative tech in the development context, and then test and scale their ideas.

https://www.frontiertechhub.org/
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