Sustainability as an opportunity: Value creation for innovative ventures through proactively tackling environmental and social issues. A study on Librixer AB about reducing water pollution by recycling unused pharmaceuticals.

Abstract: This thesis argues that Sustainable Business Model Innovation should be considered an essential process for small- and medium-sized enterprises to create value. In order to establish a sustainable value proposition, the researchers propose that social, economic and environmental attributes have to be considered from the start of a Business Model Innovation process and that social and environmental aspects cannot simply be added to an existing Business Model. In doing so, the authors describe the necessary Business Model Innovation process for small- and medium-sized enterprises and the various benefits that it can provide, aiming for including all three aspects of sustainability. The qualitative exploratory research design provided the authors with data from both indirect and direct stakeholders of the case company, as well as experts within sustainability and business in Rwanda. Business Model Innovation has been growing in academia in recent years and stems from the research on Business Models that gained popularity in the dot-com era. The core of Business Model Innovation is that a company must challenge its Business Model often not to become outdated. By that logic, the authors argue that sustainability can be an opportunity for ventures if a correct Business Model Innovation process is applied. The authors present three key findings from the conducted research. First is the importance of the Sustainable Development Goals. While the goals act as a currency and reference for ventures, they must be iterated alongside the viable proposition during the innovation process. Also, small- and medium-sized enterprises need to identify an environmental or social problem that is specific to the region of interest. Therefore, it is important to consider local issues that the company’s value proposition can help to solve. In the long-term, it helps to gain trust from stakeholders such as governments, investors and communities. Lastly, companies need to involve the mentioned stakeholders earlier and to a higher degree than when conducting business with a purely economic purpose. That type of involvement is often overlooked, but nevertheless, it increases the likelihood of local value creation and mitigates potential risks. The contribution from this thesis can act as a basis for further research, especially for small ventures that see Sustainable Business Models as a valid opportunity to create value. The investigation carried out in this thesis studies an innovation in the milling industry owned by a Swedish company called Librixer AB. The venture offers separation and comminution solutions for business customers in the fields of food and mining as well as recycling and provides instant material separation through a new process. Instead of milling materials by crushing them against two surfaces, the Librixer mill uses an airstream to separate the material in its natural boundaries. The company has a fuzzy Business Model, has sustainable aspirations, and owns a technology that can create economic, social and environmental value.