The world faces a critical resource crisis, with overconsumption and over-extraction degrading natural ecosystems. Global resource consumption is projected to rise 60% by 2060 compared to 2020 levels owing to urbanization, industrialization, and population growth. This mounting pressure highlights the urgent need to transition away from the linear take-make-waste economy toward a circular model. A new model that prioritizes sustainable resource use, waste reduction, and long-term material efficiency.
The circular economy is more than just recycling —it requires rethinking product design, extending material lifecycles, and adopting innovative business models to decouple economic growth from environmental harm. Climate Tech innovations play a pivotal role in this transformation by maximizing resource efficiency, minimizing waste, and creating new value chains.
Investment in Climate Tech solutions for the circular economy is slowly gaining momentum, rising from 7.7% of total Climate Tech investments in 2020 to 9.9% in 2024. As industries and investors increasingly value circular systems, capital is being directed toward technologies that reduce waste, reuse materials, and promote long-term sustainability.
Solutions across the Circular Economy
Building a circular economy requires a system-wide shift to reduce waste, extend material lifecycles, and optimize resource efficiency. The Climate Tech Taxonomy provides a structured framework to categorize solutions across waste management, food waste and loss, shared mobility, circular packaging, and more.
Waste Management
As global consumption rises, managing waste and reusing materials become increasingly important for a sustainable economy. Climate Tech drives new solutions to cut waste, reduce emissions, and recover valuable resources across industries.
The built environment and mobility systems are the primary consumers of materials, followed by the food and energy sectors. Together, these industries drive nearly 90% of global material demand, making recycling and resource recovery key to building a more sustainable, circular economy. These are some of the innovative solutions are transforming waste management and material recovery:
- Biomass valorization: Crop residue from food production can be repurposed for waste-to-energy production, biochar, or animal feed. This helps prevent organic waste from accumulating in landfills.
- Recycling building materials: Recycling and upcycling construction materials reduces demand for new production. This in turn helps in curbing deforestation, mining, and carbon emissions in the built environment.
- Aluminum recycling: Aluminum production is energy-intensive, but recycling aluminum requires just 5% of the energy needed for new production, significantly cutting emissions and costs.
- E-waste recycling: Millions of discarded electronic devices release toxic chemicals into the environment. Recovering gold, copper, aluminum, and other materials from e-waste prevents pollution and reduces the demand for raw materials.
- Plastic recycling: While plastic plays a critical role in healthcare, food packaging, and manufacturing, it is a leading cause of pollution. Climate Tech companies are pioneering collection, sorting, and transformation to create new, usable materials from plastic waste.
Notable startups to watch out in Waste Management
Canadian company Cyclic Materials is creating a circular supply chain for rare earth elements. Their proprietary technology separates rare earth magnets and critical metals from end-of-life products and turns them back to their raw form. The company closed a $55M Series B round in January 2025 from InMotion Ventures, Energy Impact Partners, and Zero Infinity Partners amongst other investors.
PRISM™ Worldwide repurposes end-of-life tire (ELT) rubber into high-value materials used in road construction, roofing, and new tire production. By diverting waste from landfills, the company helps prevent emissions and promotes circularity in the rubber industry. They raised $40M in Series A funding in November 2024 from investors including Columbia Pacific Advisors, Jim Sinegal, and Robert Anderson.
Cambium Carbon operates a circular marketplace for salvaged wood, transforming storm-felled or construction-site-cut trees into valuable products like furniture and siding. Profits from sales support community reforestation projects, closing the loop on urban wood waste. In February 2025, the company secured $18.5M in Series A funding from various investors.
Shared Mobility
The current mobility landscape remains heavily dependent on fossil fuels, contributing to excessive GHG emissions, urban congestion, and economic losses. Transitioning to a circular mobility system can mitigate these challenges by integrating low-emission transportation solutions such as electric vehicles (EVs) and shared mobility models. Leasing and vehicle-sharing services optimize usage, extending vehicle lifecycles and reducing environmental impact.
Circular mobility solutions like shared micro-mobility, ride-hailing, car-sharing, and public transit are reshaping urban transport. These are making transport more efficient, affordable, and sustainable.
Notable startups to watch out in Waste Management
Rapido is India’s largest bike taxi service, connecting riders with bike captains for fast, affordable intra-city travel. Its platform enhances urban mobility with a reliable and user-friendly experience. Rapido secured $29.7M in Series E funding from Prosus Ventures in February 2025.
US-based Circuit operates on-demand, 100% electric shuttle services, bridging first- and last-mile transit gaps. Its eco-friendly model reduces congestion and lowers emissions in urban areas. Circuit raised $17M in Series B funding in February 2025 from Mackinnon, Bennett & Company, Tribeca Venture Partners, and Impact Engine.
Carpool Logistics, a US-based automotive logistics platform, connects vehicle shippers with auto haulers to optimize transport. By consolidating shipments, the company reduces costs and emissions for businesses and individuals. Carpool Logistics raised $12M in Series A funding in January 2025 from various investors.
Food Waste and Loss
Food waste and loss account for 8-10% of global GHG emissions while driving biodiversity loss and consuming almost one-third of the world’s agricultural land. Addressing this inefficiency is critical to reducing emissions, conserving resources, and building a more sustainable food system.
Climate Tech innovations play a vital role in minimizing food waste and optimizing resource use like:
- Shelf-life extension technologies to reduce spoilage and food loss
- Improved cold chain logistics to enhance storage and transportation efficiency
- Upcycling food waste into edible products, reducing unnecessary disposal
- Food waste valorization, which repurposes discarded food into animal feed, fertilizers, biofuels, textiles, and bioplastics
Notable startups to watch out for in Food Waste and Loss
Spanish company MOA Foodtech converts agri-food by-products into high-nutritional sustainable protein. Their fermentation-based process reintroduces food by-products into the supply chain as a viable alternative to animal and plant-based proteins. MOA Foodtech received a $2.4M grant from the European Innovation Council in February 2025.
Hubcycle, a French startup, upcycles plant-based side-streams like fruit peels and vegetable residues into raw materials for food and personal care products. Its process transforms waste into natural flavors, additives, and essential oils. In October 2024, Hubcycle raised $16.3M in Series A funding from various investors.
Kanpla, a Danish startup, optimizes food ordering and management for canteens and cafeterias, reducing surplus and waste. Its platform provides data-driven insights to help institutions prepare precise meal quantities. In November 2024, VC henQ invested $8.5M in Kanpla’s Series A funding.
Circular Packaging
The retail industry is a major contributor to plastic overconsumption, with packaging waste driving significant carbon emissions. Plastics account for 3.3% of global GHG emissions throughout their lifecycle, highlighting the urgent need for sustainable packaging alternatives.
Climate Tech innovations in circular packaging transform traditional packaging models by prioritizing reduction, recyclability, and extended material use. Solutions include:
- Biodegradable and compostable materials to minimize environmental impact
- Reusable and dissolvable packaging that extends product lifecycles
- Edible packaging that eliminates waste altogether
Startups in Circular Packaging to watch
Pulpex, a UK-based packaging technology company, develops renewable packaging solutions using sustainably sourced wood pulp. Its bottles have a lower carbon footprint than traditional glass or PET alternatives. In February 2025, Pulpex raised $77.7M in Series D funding from investors including National Wealth Fund and The Scottish National Investment Bank.
Solubag, a US-based startup, replaces single-use plastics with patented biodegradable material that dissolves in water within minutes, providing an eco-friendly alternative to plastic bags. In October 2024, Solubag raised $4.5M in Series A funding from investors including Exit Ventures and Between the Coasts Ventures.
The Circular Economy is Redefining Sustainability
The circular economy is reshaping industries, requiring a shift in how products and infrastructure are designed, built, and maintained. By embracing this transition, you can reduce costs, unlock new revenue streams, and strengthen long-term sustainability.
Our latest Circular Startup Funding in Europe report, developed with Ecoembes, provides key insights to help you navigate this evolving landscape. Find detailed information on the rise of biopolymer packaging, increased debt financing in mega-rounds, and more—offering a clear view of where the market is headed.
With real-time data on capital flows, market trends, and emerging innovations, you can identify high-impact opportunities and play a key role in advancing the circular economy.
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