1 s2.0 S0959652623012088 Main

Journal of Cleaner Production 406 (2023) 137050
Contents lists available at ScienceDirect
Journal of Cleaner Production

journal homepage: www.elsevier.com/locate/jclepro
Frugal innovation as a source of sustainable entrepreneurship to tackle

social and environmental challenges
Muhammad Shehryar Shahid a, Mokter Hossain b, *, Subhan Shahid c, Tehreem Anwar a
a
Suleman Dawood School of Business, Lahore University of Management Sciences, Opposite Sector U, DHA, Lahore Cantt, Lahore, Pakistan
b
Center for Entrepreneurship and Organizational Excellence, College of Business and Economics, Qatar University, PO Box 2713, Doha, Qatar
c
Department of Management, Technology and Strategy, Grenoble École de Management, 38000, Grenoble, France
A R T I C L E I N F O A B S T R A C T
Handling Editor: Cecilia Maria Villas Bôas de Sustainable entrepreneurs have increasingly faced challenges in achieving triple-bottom-line objectives. The
Almeida study portrays frugal innovation as a source to foster sustainable entrepreneurship to move the debate beyond
discussing the challenges of sustainable entrepreneurship. As such, we investigate how sustainable entrepre
Keywords: neurship with frugal innovation can tackle social and environmental challenges in the context of a developing
Sustainable entrepreneurship
country. An inductive approach with multiple case-method is used in this study. The results show that entre
Frugal innovation
preneurship based on frugal innovation leads to several social outcomes, such as female empowerment, improved
Sustainability
Developing countries quality of life, and access to affordable healthcare for low-income customers as well as environmental outcomes,
such as sustainable products and production techniques. Furthermore, sustainable entrepreneurship creates new
markets in developing countries and promotes inclusive growth. Our research reveals that sustainable entre
preneurship if based on frugal innovation, serves dual purposes. It enables businesses to make a profit and
contribute to solving societal problems simultaneously. Juxtaposing with frugal innovation, we expand the field
of sustainable entrepreneurship by shifting the debate from barriers to potential sources and enablers. Based on
the findings, we provide implications and future research directions.
1. Introduction Responding to the debate on the challenges associated with sus

tainable entrepreneurship (Hoogendoorn et al., 2019; Shahid and Rey
Sustainable entrepreneurship as a way to solve inequality and naud, 2022), we aim to reveal its potential enablers. Prior research
environmental degradation is gaining growing recognition from suggests that sustainable entrepreneurship has to create social and
scholars, practitioners, and policymakers (Mendes et al., 2022; Muñoz environmental benefits along with the traditional aspect of economic
and Cohen, 2018; Urbaniec et al., 2022). It has been considered a key rents (Cohen and Winn, 2007; Muñoz and Cohen, 2018), as such a
subdomain of a solution to social and environmental problems (Argade number of challenges are linked with it including access to funding,
et al., 2021a,b; Stubbs, 2017). It refers to the discovery, creation, and information asymmetries, lack of customer awareness and governmental
exploitation of entrepreneurial opportunities that contribute to sus support (Hoogendoorn et al., 2019; Thelken and de Jong, 2020). In
tainability with triple-bottom-line objectives, i.e., economic, social, and addition, these challenges are even more adverse in developing coun
environmental wellbeing (Hockerts and Wüstenhagen, 2010; Shepherd tries, where discovering and exploiting sustainable business opportu
and Patzelt, 2011). Research on sustainable entrepreneurship thus far nities is much more strenuous (Argade et al., 2021a,b). Therefore, to
emphasizes the conceptual distinction from traditional entrepreneurship present a way forward in stimulating sustainable entrepreneurship, we
(Muñoz and Cohen, 2018), the promise of triple-bottom-line objectives contend frugal innovation (FI) as a source to achieve sustainable busi
(Cohen and Winn, 2007), and additional barriers to sustainable busi ness outcomes. Particularly in a resource-scarce context, where limited
nesses (Hoogendoorn et al., 2019; Shahid and Reynaud, 2022). Scholars resources otherwise make it challenging to pursue such business
are interested in identifying risks, constraints, and obstacles in nurturing opportunities.
sustainable entrepreneurship. According to Hossain et al. (2016, p.113), FI is a resource-scarce
* Corresponding author.
E-mail addresses: [email protected] (M.S. Shahid), [email protected] (M. Hossain), [email protected] (S. Shahid),
[email protected] (T. Anwar).
https://doi.org/10.1016/j.jclepro.2023.137050
Received 19 September 2022; Received in revised form 25 March 2023; Accepted 31 March 2023
Available online 5 April 2023
0959-6526/© 2023 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/).
M.S. Shahid et al. Journal of Cleaner Production 406 (2023) 137050
solution that has been developed and used under financial, technolog 2. Theoretical background
ical, and material or other resource constraints, yet it is good enough to
meet the needs of underserved customers who would otherwise be un 2.1. Sustainable entrepreneurship
able to afford the existing products and services. FI has emerged as a
solution to social challenges (Hossain et al., 2021), and many aspects of Every day the world is besieged by grand challenges impacting
FI link to sustainability (Albert, 2019). FI’s offering of sustainability people’s political, economic, and social wellbeing, such as climate
overlaps with the qualities of sustainable entrepreneurship. However, to change, environmental degradation, food insecurity, famine, rising
the best of our knowledge, there is no scholarly attempt to theorize the poverty and homelessness, deforestation, and depletion of clean drink
link between these two concepts. Exploring sustainable entrepreneur ing water, to name a few. Despite technological, economic, and social
ship with FI to tackle social and environmental challenges is a timely and progress, these grand challenges remain stubbornly persistent and are
valuable research area. Hence, this study explores how entrepreneurship becoming even more evident with time (George et al., 2016). Can
based on FI contributes to sustainable development by solving economic, so entrepreneurship help solve these grand challenges? Traditionally,
cial, and environmental challenges in a developing country. Based on six entrepreneurship has been studied as a mechanism to stimulate eco
cases of Pakistani start-ups and using interviews, observation, and sec nomic development (Kirzner, 1973; Sarango-Lalangui et al., 2018) and
ondary data, we attempt to understand how sustainable entrepreneur create financial value (Schumpeter, 1934). However, increasing
ship with FI contributes to solving socio-ecological challenges. As a awareness of global social and environmental challenges has caused
result, we bring together two apparently separate theoretical disciplines many academics to reconceptualize the notion of entrepreneurship from
– sustainable entrepreneurship and frugal innovation – and offer a more merely being a wealth-generating activity to an endeavor that must also
integrative framework for achieving sustainable development in devel incorporate elements of social and environmental goodness in its
oping countries. Our study makes three key contributions to the mission (Anand et al., 2021; Gast et al., 2017; Schaltegger and Wagner,
literature. 2011). This reconceptualization of entrepreneurship in the academic
First, considering the additional challenges associated with sustain discourse is referred to as sustainable entrepreneurship – an increasingly
able entrepreneurship (Hoogendoorn et al., 2019; Shahid, 2022), we important sub-field of entrepreneurship research. According to Shep
theorize frugal innovations as a source to achieve sustainable outcomes. herd and Patzelt (2011, p.142), sustainable entrepreneurship is defined
Sustainable entrepreneurship enables entrepreneurs to gain profit and as an activity “focused on the preservation of nature, life support, and
improve social and environmental conditions simultaneously (Belz and community in the pursuit of perceived opportunities to bring into existence
Binder, 2017). Meanwhile, FI has become apparent as an affordable future products, processes, and services for gain, where the gain is broadly
solution for cleaner production processes and quality products that serve construed to include economic and non-economic gains to individuals, the
underserved customers (Albert, 2022; Dabić et al., 2022). As such, we economy, and society”.
explain that frugal innovation is a reliable solution in resource-scarce Scholars increasingly perceive entrepreneurship and sustainable
environments that subsequently contributes to sustainable develop development as two interconnected phenomena. As a result, entrepre
ment. This shifts the debate from discussing the challenges of sustain neurs are seen to make efforts to reduce the negative impacts of their
able entrepreneurship towards potential solutions for promoting activities on the environment and society (Markman et al., 2019; Muñoz
sustainable entrepreneurship. We argue and explain that sustainable et al., 2018). Many terminologies have been used to discuss the sus
entrepreneurship if based on FI has enabled people from all social tainability discourse in entrepreneurship. Such as “ecopreneurship”
groups to afford a healthy lifestyle and improve the overall quality of life (Dixon and Clifford, 2007; Isaak, 2002), “sustainable development
in the developing world. Such entrepreneurship contributes to female entrepreneurship” (Muñoz and Cohen, 2018), “sustainable entrepre
empowerment and creates social value in the communities (Barrachi neurs” (Choi and Gray, 2008; Tilley and Young, 2009), “environmental
na-Fernández et al., 2021). In addition, it plays a crucial role in pro entrepreneurship” (Linnanen, 2005), “green entrepreneurship” (Schal
moting sustainable lifestyles while also focusing on the tegger, 2002) being employed interchangeably to connote sustainable
environment-friendly production of goods and services. Eventually, entrepreneurship. Most commonly, sustainable entrepreneurship has
entrepreneurship based on FI has enhanced the prospects of inclusive been linked with the concepts of ecopreneurship and social entrepre
growth through opportunity creation and development. neurship for their focus on preserving the natural environment and
Second, we explain what enables frugal innovation from the entre creating social value, respectively. Sustainable entrepreneurship, how
preneur’s perspective. We divulge those entrepreneurs’ personal char ever, is a distinctive concept that combines economic, social, and
acteristics, networks, and inspirations contribute to identifying and environmental value creation with its focus on the wellbeing of future
exploiting frugal innovations with socio-environmental benefits that generations (Terán-Yépez and Marín-Carrillo, 2020; Belz and Binder,
result in sustainable business practices. We emphasize the importance of 2017). Therefore, many scholars view an entrepreneurial activity as
entrepreneurs’ personal factors that motivates them to pursue FI-based sustainable when it combines holistic economic, social, and environ
sustainable entrepreneurial opportunities. Finally, as the current body mental goals to pursue business opportunities (Schlange, 2009; Tilley
of literature on sustainable entrepreneurship is dominated mainly by and Young, 2009). Sustainable entrepreneurship, in its essence, is a
research in the context of developed countries (Argade et al., 2021a,b), pursuit of the triple bottom line (Muñoz et al., 2018; Nicolopoulou,
the case of Pakistan not only brings in the perspective of a 2014). While the achievement of the triple bottom line is an integral
resource-constrained setting but also explains how sustainable entre objective of sustainable entrepreneurship, it must also involve an active
preneurship with frugal solutions can serve low segments of society. discovery, creation, and exploitation of new opportunities on the part of
Prior research indicates that resources and culture are key factors the agents (i.e., sustainable entrepreneurs) to distinguish itself from
affecting entrepreneurs’ intention to create social and environmental sustainable development and become entrepreneurial (Shepherd and
value (Brieger and De Clercq, 2018). Therefore, context is another Patzelt, 2011).
pivotal factor in considering entrepreneurs’ propensity to solve social Over the last decade or so, various streams of inquiry have emerged
challenges (Urbano et al., 2019). We present the case of a developing within the mainstream literature of entrepreneurship vis-à-vis the
country where despite resource constraints; FI has emerged as a theoretical development of sustainable entrepreneurship. The earliest of
cost-effective way to foster sustainable entrepreneurial opportunities. these streams focused on the conceptualization of sustainable entre
preneurship, within which we see a group of scholars trying to develop
different constructs of sustainable entrepreneurship while others focus
on distinguishing it from other forms of entrepreneurship (Schaefer
et al., 2015; Schaltegger and Wagner, 2011). Another strand of research
2
has rather focused on understanding the agent themselves, i.e., the solution that provides low-cost yet quality products to meet the needs of
sustainable entrepreneurs, providing several conceptualizations around low-income customers living in a resource-constrained environment
what motivates entrepreneurs to pursue sustainability goals (Nhe (Zeschky et al., 2011). Generally, FI spans the healthcare, transport,
machena and Murimbika, 2018) and the capabilities they need to energy, housing, education, and manufacturing sectors, enabling en
materialize such goals (Brieger and De Clercq, 2018). trepreneurs to develop unconventional yet affordable business solutions.
Many scholars have focused on understanding the process of sus The innovative aspect of FI involves simplification (Lim et al., 2021) to
tainable entrepreneurship, i.e., how new sustainable ventures are deliver fundamental needs with minimum resource consumption, tar
created and their particular contribution to sustainable development geting the low-end customers of society (Hossain, 2018) while also
goals (Belz and Binder, 2017). The main emphasis of scholars within this considering their wellbeing (Hossain et al., 2016). Over the years, FI has
process stream is ‘opportunity exploitation’ process in the field of sus been conceptualized differently in several areas. Some academics have a
tainable entrepreneurship and how ‘sustainable innovation’ and its product-centric perspective (Winterhalter et al., 2017), others like to
associated activities emerge within firms (Bapoo et al., 2022; Schalteg conceptualize it as a process (Knizkov and Arlinghaus, 2020), while
ger and Wagner, 2011). As the field develops, recent studies try to offer some also define it as a type of business strategy or as a blend of unique
more holistic overviews of the phenomenon, ranging from studies techniques, goods, and services (Bound and Thornton, 2012). When it
exploring the framework of ‘sustainable business models’ (Lüdeke- comes to novel product architecture (Rao, 2013; Lim and Fujimoto,
Freund, 2020; Davies and Chambers, 2018), the role of digital tech 2019) or opening a new market (Zeschky et al., 2011), FIs can occa
nologies in achieving socio-ecological value (Gregori and Holzmann, sionally even be “disruptive” for established mainstream solutions (Rao,
2020) and the formulation of sustainable entrepreneurship strategies 2013). Even though there are different ways to approach FI, there is a
(Rantala et al., 2019). There is also growing literature on the challenges broader consensus on its ability to provide quality and cost-effective
and barriers of sustainable entrepreneurship spreading from lack of solutions to meet the needs of under-served communities in
institutional support, access to funding, perceived risk, customer resource-constrained settings.
awareness, and information asymmetries (Hoogendoorn et al., 2019;
Shahid, 2022). Lastly, most of the evidence and conceptualizations of 2.3. Frugal innovation and developing countries
sustainable entrepreneurship thus far are situated in the context of
developed countries (Terán-Yépez and Marín-Carrillo, 2020), with a FI is regarded as an imperative and cost-effective solution in devel
very scant understanding of this phenomenon in the context of devel oping countries due to insufficient resources and a large number of low-
oping countries. end customers (Hossain et al., 2016). On the one hand, developing
Despite the aforementioned theoretical developments, sustainable country dynamics imply mass production, rapid growth, and high
entrepreneurship as a field of research, as asserted by Muñoz et al. profitability (Shah, 2012). On the other hand, it also emphasizes the
(2018), is in its nascency with many challenges and opportunities. There scarcity of resources and an increase in middle-to-low-class customers
is still a need to analyze sustainable entrepreneurial behaviors, pro who are still looking for affordable solutions (Agnihotri, 2015; Iyer
cesses, and effects (Muñoz and Dimov, 2015), especially in the face of et al., 2006). FI maximizes the ‘value’ output for low-income back
ever-changing circumstances and grand challenges. Particularly, there is ground people by adopting “financial, human and material frugality”
a need to go beyond discussing the objectives of sustainable entrepre (Rao, 2013, p.133), leading to sustainable development and an
neurship, crafting a difference among several ways of practicing entre empowered lifestyle for the poor. FI is highly regarded in developing
preneurship and the additional challenges associated with fostering countries such as entrepreneurship built on FI has been found to solve
sustainable entrepreneurship. Therefore, there is a need for “cross- various societal and environmental challenges, such as access to primary
pollination of research” (Anand et al., 2021, p.15) between sustainable healthcare (Agarwal et al., 2020), women empowerment (Hossain,
entrepreneurship and other related subject areas to advance the field by 2021), access to clean energy (Bas, 2020), provision of affordable
delving into potential sources of sustainable opportunities. For example, housing (Dressler and Bucher, 2018), and so on. It is also closely asso
innovation and social entrepreneurship literature have the potential to ciated with the notion of inclusivity, under which markets can engage
inform sustainable entrepreneurship with regard to developing a more and benefit individuals who are traditionally excluded or even exploited
profound and broader understanding of its processes and outcomes. As by prevailing market systems, such as the poor, women, and other
of now, our ability to understand the dynamics of a sustainable venture marginalized groups (Drori et al., 2018; Mair et al., 2012). Entrepre
vis-a-vis innovation is limited (Hockerts et al., 2018). neurs practising FI combine and align principles of business strategy
Finally, there is also a need to engage more closely with the ‘out with those that involve social value creation (Agarwal et al., 2021) by
comes’ of sustainable entrepreneurship activity. Sustainable ventures addressing social problems like poverty, health care, and clean water.
are distinct in their pursuit of a net positive impact on individuals, so They ensure that their business models create value for the customers
cieties, and the wider ecological system. Their pursuit of a triple bottom ignored by conventional firms (Hossain, 2018; Chliova and Ringov,
line that makes it difficult for researchers to capture and evaluate the 2017). It implies that FI fosters economic activities in developing
outcomes of sustainable entrepreneurship in an objective manner countries and contributes to social and environmental well-being.
(Anand et al., 2021). There is a heightened need for studies that “can However, the link between FI and sustainable entrepreneurship re
explore how the solutions developed and promoted by sustainable mains missing in the literature, the gap that this paper precisely aims to
ventures contribute directly to improving the wellbeing of social groups fill.
and changing the behavior of markets, competitors and industries”
(Muñoz et al., 2018, p.328), an objective that warrants 2.4. Frugal innovation: a pathway to sustainable entrepreneurship
cross-fertilization of sustainable entrepreneurship literature with the
theoretical discourse of innovation. Recent research supports that sustainability is a well-proven
outcome of frugal innovation (Hossain, 2020). Scholars hold the view
2.2. Frugal innovation that frugal products are affordable for the base of the pyramid customers
without compromising socio-ecological and economic sustainability
A newly emerged concept called frugal innovation has caught great (Levänen et al., 2016). FI drives social equity (Basu et al., 2013) and
attention, particularly in management research (Fischer et al., 2020; encourages saving resources to lower the carbon footprint (Brem and
Hossain, 2020; Zeschky et al., 2017). It refers to developing affordable Wolfram, 2014; Rosca et al., 2017). FI and social sustainability are thus
solutions with limited resources for producing goods and services intertwined as it enables mainly poor communities to solve various
(Hossain et al., 2016). The uniqueness of FI lies in its being an innovative problems pertaining to health, education, and energy to uplift their
3
living standard (Khan, 2016). The importance of measuring innovation commerce, FinTech, or logistics, with much lesser attention being paid
through the lens of sustainability is growing, and there is a close to sustainable business ideas that have the potential of creating greater
connection between FI and sustainability in developing countries on-ground impact in the country. Although entrepreneurship has shown
(Hossain, 2020). proven success in achieving sustainable development through its activ
Therefore, we argue FI should be seen as a pathway to sustainable ities (Rantala et al., 2019; Dawo et al., 2022), tackling the additional
entrepreneurship due to its ability to solve social, environmental, and challenges posed by a developing country like Pakistan is no easy feat.
economic problems faced by low-income populations residing in The weak institutional environment and widespread poverty require
resource-constrained settings for three main reasons. First, given that nascent businesses to devise ingenious ways to chart their course toward
research reveals several additional barriers to sustainable entrepre sustainable development. This study, therefore, attempts to examine
neurship, such as access to resources and perceived lower profitability how some pioneering local start-ups have utilized frugal innovations not
(Hoogendoorn et al., 2019; Shahid, 2022), FI in developing countries only to create economically profitable businesses but also to deliver
enables to provide cost-effective solutions (Levänen et al., 2016) that socio-environmental value through their activities despite the chal
ultimately lower their production cost and results in better economic lenging and resource-scarce environment in which they operate.
rents. Second, due to rapid growth in developing countries, there is a
significant threat of scarcity of resources (Iyer et al., 2006; Shah, 2012). 3.2. Research design
However, FI may serve as a route to build goods and services with
limited means, consequently facilitating the preservation of recourses. Given the limited insights on frugal innovation in relation to sus
Finally, one may argue that since middle-to-low-end customers are tainable development, particularly in an developing country context,
abundant in developing countries, FI provides them with offerings that this study adopts a qualitative research design using an abductive
not only fulfil their needs at an affordable cost but also have approach with multiple case study method, as suggested by Eisenhardt
socio-economic benefits in terms of efficient use of resources and social (1989). The choice of this method is based on its effectiveness for theory
inclusion. Understanding FI and its contribution to sustainable entre development or extension (Yin, 2014). The case study method is also
preneurship is therefore crucial. Using a qualitative lens, we look at how extensively recognized for exploring underexplored and dynamic con
entrepreneurship based on FI contributes to sustainable development in cepts (Agarwal et al., 2021). The methodology choice also helps over
developing countries, which helps advance the field of sustainable come specificity-based weaknesses and enhances the validity and
entrepreneurship by shifting the debate from barriers to potential generalizability of the study findings. It also helps us analyze the vari
sources and enablers of this phenomenon. ations and commonalities between the cases arising out of shared cul
ture, infrastructure, and policies. Based on this replication logic of
3. Methods multiple cases, authors were able to advance the theory regarding sus
tainable entrepreneurship targeted through frugal innovation in a
3.1. Research setting developing country. Prior studies have utilized a similar methodology to
study frugal innovation in developing countries (e.g., Chakravarty,
With over 231 million people, Pakistan is one of the most densely 2022; Goodman et al., 2017)
populated countries in the world. The annual growth rate of 1.8% cre
ates a unique set of economic, social, and developmental challenges for 3.3. Case selection
this rapidly multiplying population (World Bank Data.Pakistan, 2021).
On the flip side of this steadily rising curve, the youth dividend in the Table 1 delineates the basic characteristics of all the cases, including
country has allowed it to achieve high levels of economic growth over the year established, start-up motives, current and future products, as
the last ten years, yet the most marginalized factions of society continue well as the social, environmental, and economic outcomes of their so
to be excluded from it. Compared to other developing countries in lutions. Frugal innovations from these firms were identified through
Southeast Asia, Pakistan has a much larger chunk of the population purposeful sampling (Patton, 1990) to create a diverse set representing
living below the poverty line. As per recent data from the multidimen multiple sectors. Despite belonging to different industries, the common
sional poverty index (MPI) that monitors deprivations in 10 indicators threads between the cases lay in origin and effort. All selected cases
spanning health, education, and standard of living, the average per catered to low-income customers and were founded within the last five
centage of poverty for South Asian countries is 20.5 percent (UNDP, years. Furthermore, the primary business idea was to solve a latent and
OPHI, 2022). By comparison, 38.3 percent of the Pakistani population is critical customer need through some proprietary innovation that resul
multi-dimensionally poor, while an additional 12.9 percent has been ted in sustainable development for the targeted underprivileged
classified as vulnerable to it. Furthermore, Pakistan appears as one of the customer segment.
two South Asian countries that house the world’s poorest of the poor Appendix A provides a brief description of each case. A key part of
(the other being Afghanistan), who are deprived in all 10 MPI indicators the study included understanding systemic conditions through desk
with a deprivation score of 100 percent. The country also score poorly research and interactions with other local actors. In order to carry out
on the climate safety dimension of sustainable development. Pakistan preliminary selection, two of the co-authors engaged in desk research
has been hard hit by natural disasters stemming from climate change and network interaction in the local ecosystem to come up with thirteen
resulting in large-scale destruction of property, food insecurity, water innovative start-ups that were creating sustainable developmental so
scarcity, and healthcare issues (Hussain et al., 2019). lutions through the provision of necessities like affordable housing,
Despite its plethora of developmental challenges, Pakistan has clean drinking water, primary healthcare and mode of transportation.
experienced an escalation in total entrepreneurial activity between 2017 Six of the initially sampled start-ups were then shortlisted for this study.
and 2022, with a record number of new startups. In 2021, despite the The shortlisting criteria included the ability of these enterprises to (1)
COVID-19 pandemic, Pakistan hit an all-time high of $350 million in serve underprivileged customer segments, (2) create socio-
investments raised by local start-ups, more than five times the $65 environmental value, (3) build proprietary technology, and (4) offer
million raised in the previous year (Invest2innovate, 2021). However, an affordable solution to address a critical customer need.
the link between the country’s much-needed sustainable development
and the targeted innovations created by this rising entrepreneurial ac 3.4. Data collection
tivity is missing since most of these businesses are geared towards eco
nomic wealth creation. The start-up culture is primarily fixated on Unstructured interviews, field observations, and extensive archival
creating Silicon Valley clones of technology-enabled businesses in research were used to gather data for this study. Table 2 outlines the
4
M.S. Shahid et al.
Table 1
Case summaries and sustainability outcomes.
Cases Year Products Start-up motivation Frugality characteristics Social outcomes Environmental outcomes Economic outcomes
established
Byonyks 2017 - Bloodless home-based -Refusal of western companies -Costs about 1/10th of the -Dialysis machine for people -App designed to promote − 100% in-house designing of both
dialysis machine to distribute their portable price of imported suffering from kidney disease online dialysis consultation mechanical and electronic components
Products under: development: dialysis machines in the low- equivalents. leading to the creation of new markets
-Different models of the income market of Pakistan -Very lean physical -Export opportunities explored in Kenya
dialysis machine -Personal desire of the founder infrastructure.
-Complimentary mobile to serve the underprivileged -Considerable reliance on
application favors from individuals
and voluntary groups in
the US and UK.
Daisy 2016 -Eco-friendly and health- -Menstrual taboo and lack of -Use of local raw -Sanitary napkins and hygiene -Use of cotton (organic raw -Local production and manufacturing
friendly sanitary napkins female hygiene in Pakistan materials. camps for females living in material) instead of synthetic team employed from the outskirts of the
Products under development: –Personal environmental -Very low manufacturing underprivileged areas to raw materials city, leading to self-employment
-A range of sanitary napkins consciousness of the founder cost due to low educate them on menstrual -Biodegradable menstrual pads opportunities for people in remote areas
with different specifications mechanization. health. -Environmentally friendly and
-Low fixed cost due to carcinogen-free manufacturing
outsourced process
manufacturing.
-No profit charged on
products sold through
NGOs.
Ez-Shifa 2018 -Technology-enabled kiosk -Founders’ self-realization of -Costs 1/4th of the fee -Technology-enabled kiosk for - Paperless and online medical - Use of local raw material.
for medical consultation poor primary healthcare charged by a private medical consultation [Apna consultation − 100% in-house development of
[Apna Doctor] for the remote facilities in remote areas of hospital doctor. Doctor] in the remote areas software.
areas of Pakistan. Pakistan -Simple to set up, easy to -Costs 1/4th of the fee charged - Internationalization of local business
-Products under development: use, and limited training by a private hospital doctor. due to partnerships with doctors in the
5
-Kiosks with integrated required to operate the USA and UK.

power bank, ultrasound, and kiosk. -An advanced version of the kiosk is
ECG machine -Use of local raw material. under development for the South
− 100% in-house African and Middle Eastern markets
development of software.
-Use of franchising model
for product distribution
Jolta 2021 Electric motorbikes: -Personal environmental -Costs ½ of the price of -Electric motorbikes to promote - Eco-friendly and noiseless -Strategic use of the existing networks of
Electric -Jolta E-bike JE 70D -Jolta E- consciousness of the founder imported Chinese an affordable mode of alternative to conventional vendors and dealers in the motorbike
bike JE-70D (SE) -JE-Scooty -Tesla’s success in the global equivalents transportation for low-income motorbikes industry of Pakistan
JE-Cycle market -Significantly improved segments –100% in-house designing,
Products under development: mileage (80Kms in -Affordable and independent manufacturing, and assembling of the
-Jolta Electric Care PKR20) which means the mode of transportation for kit leading to the creation of business
lower operating cost females opportunities for local small and micro
Journal of Cleaner Production 406 (2023) 137050

-Low manufacturing cost businesses
due to conventional
product design
Modulus 2016 Prefabricated sustainable -The Syrian global crisis that -Construction cost is 1/ -Prefabricated and affordable -Patented intermesh technology -Partnership with non-financial
Tech and affordable housing: resulted in homelessness of 3rd of the comparable housing solutions for the for prefabricated houses - More institutes for the provision of a mortgage
-Community houses -B2B displaced people products due to intermesh displaced and homeless people energy-efficient designs and low to low-income customers
office structures technology -Female ownership of the carbon footprint -Product export to some African
Products under development: -Less usage of structural houses -Solar-powered housing countries and exploring the US market
-Backyard housing -Eco material as compared to solutions
tourist pods imported equivalents - Optimization of product design
-More energy-efficient and time in the manufacturing
houses process
-Low packaging and
shipping costs due to the
(continued on next page)
primary and secondary sources used to collect data. After significant

research and discussions among the co-authors, the interview ques
-Export of POU water filters to African

-The parent company is registered in
tionnaire was completed. A total of 22 in-depth interviews with co-
Singapore to facilitate trade and

founders, senior managers, partners, and experts from the selected or
ganizations were conducted and audio recorded. Due to the Covid-19
pandemic, 15 out of 22 took place over Zoom. To gain a better knowl
edge of the businesses, the websites of the enterprises, and the profile of
Economic outcomes
each founder studied before scheduling an interview. Afterward, each

firm’s co-founders were approached for interviews/conversations via
fundraising
email and LinkedIn. Two authors jointly conducted 20 interviews.
countries
Following each interview, the interviewers briefly discussed the inter
view notes and the quality of the data acquired. All the interviews were
-Water filters with no electricity conducted in Urdu, Pakistan’s national language; however, the in
terviewees occasionally used some English phrases. All the interviews
-Patented antimicrobial hollow
filter the water of bacteria and

fiber membrane technology to
-Replaces the use of plastic

were subsequently transcribed into English using a word processor by
Environmental outcomes
the same authors and evaluated by at least one of the other authors.
Additionally, two authors conducted three field visits. The first visit
was hosted at the Jolta Electric factory in Lahore, Pakistan. The other
water bottles
consumption
two included detailed tours of Byonyks’ factory and headquarters, both

of which were in the city of Lahore. During the two factory visits, a
viruses.
senior company manager gave a guided tour of the factory, simulta

neously discussing all the manufacturing processes in detail. To record
the data, one author took photographic and video evidence. Similarly,
the low segments of the market
point-of-use water purifiers for
the HR manager of Bynoyks gave a comprehensive tour of all the de

-Detachable water filters and
superior lifespan of the filter

with no maintenance cost in
partments operating in Byonyks head office. This was followed by an in-

-Enhanced access to clean
drinking water due to the
person interview with the founder of the company. Lastly, one of the key
American experts working with Boynyks was also interviewed to get
Social outcomes
insights on the portable dialysis machine.

The co-authors of this study also conducted exhaustive secondary
rural areas
research for this paper. As outlined in Table 2, for secondary data

collection, the co-authors scanned 55 pages, including articles, blogs,
and press releases, published in reliable newspapers and online forums.
The information was then verified from the respective firms’ official
filter with no maintenance
with a headcount of only

-Superior lifespan of the
Frugality characteristics
-Very lean organization
websites, Facebook, and LinkedIn pages. Moreover, videos referring to

-Substantially less unit
manufacturing cost.
customer reviews, product specifics and co-founders’ TV interviews

flat-pack technique
-Low fixed cost.
were thoroughly examined by the co-authors, with a total duration of

-Low fixed cost
14 employees
approximately 300mins, which was later transcribed.

cost.
3.5. Data analysis
For data analysis, we used NVivo, which is a powerful software to

founder from Diarrhoea after
drinking contaminated water
organize, code and analyze qualitative data. An inductive approach was

-Personal suffering of the
used to develop a framework linking the under-explored relationship

between FI and sustainable entrepreneurship (Eisenhardt et al., 2016).
Start-up motivation
Considering sustainability literature, we made three aggregate di

mensions: economic, social, and environmental (Hossain et al., 2021).
To finalize the first-order categories, we applied open coding to inter
view transcripts to deduce examples fitting into the themes (Gioia et al.,
2013). The initial set of codes was developed, focusing on the concepts
discussed mainly in the literature on sustainable entrepreneurship and
-Water dispenser bottle with
Products under development:
FI. We revisited data and theory multiple times to create new codes in a
-Point-of-use (POU) water
-The athlete water bottle

Detachable water filters:
recurring manner (Hossain et al., 2021). Many codes emerged from the
with preinstalled filter
initial coding focusing on how sustainable entrepreneurship through FI

pre-installed filter
has led to an enhanced standard of living and an environmentally

friendly space while also leading to an inclusive growth of people and
Products
the economy. Next, we merged similar codes in accordance with our

filters
first-order categories. For instance, “the kiosk by Ezshifa provides online

and free general consultation to the people of Thar” and secondly, “the
device has oximeter installed which otherwise is not available at the clinics in
established
the remote areas of Pakistan” were combined as a first-order category of

Table 1 (continued )
“affordable and easily accessible online medical consultation.” This

2017
Year
first-order category led to the second-order theme of “access to a healthy

lifestyle which added to the aggregate dimension of “social outcomes.”
Pak Vitae
Similar iterations were carried out for the remaining two aggregate di
Cases
mensions. Fig. 1 outlines the structure of our data analysis in detail.

In total, we established 21 first-order categories that led to 7 s-order
6
themes that we subsequently merged to form three aggregate di
Total
1385
mensions – economic, social, and environmental outcomes.
109
22
20
12
39
4. Findings
• Co-founder (02 interviews)

Our research has identified many significant outcomes of sustainable
entrepreneurship and FI. The first section briefly discusses the factors
identified in our study that seem to influence the discovery and
exploitation of opportunities for sustainable products. The second sec
• Co-founder
tion then elaborates in detail on the economic, social, and environ

Pak Vitae
mental outcomes of entrepreneurship using FI. Based on our findings,

we conceptualize a process of sustainable entrepreneurship as depicted
280
13
in Fig. 2 and discuss its various elements as follows.
3
5
8
4.1. Identifying opportunities for sustainable solutions
• Co- founder (02 interviews)
Institutional voids, such as inadequacy of public goods and services,

poor infrastructure and lack of access to financial institutions, often
characterize a developing country. However, these gaps act as a source
Modulus Tech
• Co- founder
to sense entrepreneurial opportunities so entrepreneurs can come up

with unconventional sustainable products to provide innovative and
low-cost solutions to meet the needs of low-income customers. In such a
260
17
context, factors like entrepreneurial alertness, social aspirations, and

3
2
4
networks of the founders play a significant role in the identification and

execution of FI for sustainable development so that the unmet needs of
the poor can be met.
• Founder (02 interviews)
• Chief Technical Officer
• Marketing consultant
Firstly, entrepreneurial alertness plays a pivotal role in the devel

opment of FI, aiming to address their realized societal needs. Entre
preneurs could identify emerging needs and conceive innovative
Jolta Electric
solutions, especially in the low end of the market, by combining

advanced technologies available both from local and global sources. All
165
entrepreneurs demonstrated a strong awareness of the changes, oppor

12
10
4
tunities, and overlooked possibilities in their respective industries and

markets. For example, despite having no direct experience in the auto
motive industry, the founder of Jotla Electric was ingenious enough to
• Co- founder
• Co- founder
• Franchisee
observe the increasing use of electric cars in China during his visit to the
Ez-Shifa
Beijing Olympics in 2008, as he recalled:

210
14
“In 2016 when there was a lot of smog in Lahore, I thought how
3
1
7
could I solve this problem? The idea of electric cars I got from China
struck back, and we launched Jolta in 2017.”
• Founder (02 interviews)
Overall, the entrepreneurial alertness of entrepreneurs pushes for the

• Head of marketing
identification of FI opportunities for sustainable products. Secondly,

entrepreneurs’ ability to sense sustainable business opportunities is also
essentially shaped by their passion and aspiration to do something for
the greater good of their society. The main driving force for these en
Daisy
trepreneurs was their urge to create an inclusive society that would give
220
3
2
4
1
0
every individual, regardless of socioeconomic class, an equal opportu

nity to fulfil their fundamental needs. The founder of Jolta Electric, for
example, really stood out in expressing his compassion for and re
• Co-founder (02 interviews)
sponsibility toward society:

• Chief Technical Officer
Summary of primary and secondary data sources.
• Chief Medical Officer

• International Expert
“I have this addiction to meeting human potential which I think is to

serve. We came here to serve. We should intend to serve, superficial
things like pay, designation and car and other things don’t matter.
• Head of HR
Serve the world, be it for the God or for people, or and may be for
Byonyks
yourself. God has blessed you with immense intelligence; it is our

250
duty to pass it on to the world”.

49
10
6
Likewise, a founder of Modulus Tech is highly motivated to design

new technology for prefabricated houses, emerged from witnessing the
Press releases/blogs
Syrian refugees’ crisis, compassionately expressed:

Duration (minutes)
Social media pages

Interviewees title
No. of Interviews
Secondary Data
“To be honest, we started this venture for a social cause. It came from the
News articles
Primary data
Syrian crisis of 2016 where millions of people became homeless”.

Table 2
Videos
Cases
The self-realization of the founders for social responsibility and their

natural compassion to serve societal needs instigated them to build
7
Fig. 1. Data structure.
sustainable products using FI. Moreover, we also observed a high degree entrepreneurs develop their business models, marketing strategies,
of environmental consciousness among all the founders as they spoke supply chains and raise seed capital. For instance, Jolta Electric
about their motives for undertaking entrepreneurial ventures. Lastly, collaborated with local vendors and dealers of conventional motorbikes
networking also plays a key role for entrepreneurs to turn their frugal in deciding on many design aspects of their electric bikes. Henceforth, in
ideas into reality with sustainable development. International networks an emerging context, sustainable entrepreneurship with FI is efficiently
and emerging partnerships played a decisive role in the product’s initial executed with the help of international and local networks of the co-
development and its underlying technology for all six cases. For founders.
instance, in the case of Byonkys, the entire conceptualization of the
dialysis machine and its peritoneal technology were an outcome of the 4.2. Sustainable outcomes of frugal innovation
founder’s personal partnership with a team of international academics
and industrial experts from the UK and USA, as fondly recalled by an Social outcomes: From a social perspective, sustainable entrepre
American expert working as a consultant for Byonkys: neurship has led to inclusive growth, wellbeing, and social value crea
“He (the founder) told me his passion for making an impact in tion (see Table 2). While conventional businesses and large
Pakistan. We knew each other from the past so I got along”. organizations remain focused on high-growth and high-profit parts of
the market, the entrepreneurs manufacturing sustainable products with
In terms of local networks, entrepreneurs have especially acknowl FI serve the low ends of the market. As examined, entrepreneurs
edged the role of incubation centers and universities. They help focusing on FI were concerned with the fundamental needs of
Fig. 2. Sustainable entrepreneurship through frugal innovation.
8
marginalized and poverty-stricken people, including problems such as own is virtually impossible for someone from the middle to low-income
providing clean drinking water, affordable housing, sustainable trans class in Pakistan. The low-cost and sustainable housing options built on
portation, and lifesaving medical devices. Hence, they helped people a proprietary technology by Modulus Tech, therefore, offer an innova
break the vicious cycle of marginalization and expend their resources on tive solution to tackle the growing problem of the housing crisis in the
productive activities. Moreover, most sustainable enterprises served the country.
remote areas of Pakistan where people did not have access to conven
“From refugees to people losing their homes due to earthquakes and
tional facilities. For example, most of the telemedicine kiosks from Ez-
flooding … Pakistan has seen many displacements and is currently facing
Shifa had been deployed to the rural and less developed regions of
a shortage of housing units. A large urban population lives in slums or
Pakistan. The remote areas of Mian Wali, interior Sindh, and areas in the
shantytowns. Our enterprise was born out of this problem.” (Co-founder,
rugged north of Pakistan are some of the prime locations where the kiosk
Modulus Tech).
was being operated to provide accessible and online health care to the
residents. As one of the users of the kiosk from the highly impoverished Apart from the housing issue, another significant problem that the
areas of the Thar desert in Pakistan narrated: poor in Pakistan face is a lack of clean drinking water. PakVitae provides
low-cost detachable filters to purify water from water-borne bacteria,
“The kiosk has many facilities, and every kind of doctor is available.
viruses, and other contaminants to cater to that. With the majority of
There are specialized doctors and upon the appointment, the patient can
their clientele being from small urban and rural areas, Pak vitae dras
meet virtually. This distracts the patients from going to unqualified
tically improved the quality of life for such people by making clean
hakeems and quick doctors in the desert.” He further commented,
drinking water easily accessible and affordable for them, substituting
“another life saver is that the device has an oximeter attached which
their need to buy expensive bottled water sold by large multinational
otherwise is not available in usual clinics in the desert.”
companies. Keeping in mind that affordable and convenient commute is
In the case of Ez-Shifa, therefore, an affordable and online medical a central element of enabling people to strive for a socially and finan
consultation along with the medical gadgets attached to the kiosk has cially stable life, Jolta Electric had manufactured all made-in-Pakistan e-
made primary health care easily accessible for the people of underde bikes to replace the less efficient gasoline bikes and more expensive
veloped regions. Sustainable development is particularly about pro imported e-bikes. By improving social mobility, Jolta has made it easy
moting a healthy lifestyle for its users, complementing the overall for daily wagers and low/middle-class segments to access a better
wellbeing of people. Daisy, for example, relied on health-friendly ma quality of life without spending a fortune. As stated by the owner of Jolta
terials to produce sanitary napkins for underprivileged women living in Electric:
a resource-constrained environment who could not afford off-the-shelf
“The purpose of the e-bike is to make commute hassle free, afford
sanitary pads sold mainly by multinational companies in Pakistan. Un
able and convenient for people from middle to low-income families
like the mainstream products that bleach their materials and leave
who otherwise struggle a lot on the buses and vans.”
carcinogenic waste as a by-product, Daisy does not use a bleaching
process nor apply any chemicals during manufacturing, making their Social sustainability cannot fully be attained unless it includes all
sanitary pads a healthier product for their customers. social groups regardless of class and gender. Our cases, therefore,
showed that FI is also filled with the essence of female empowerment.
“The absorbent layer of Daisy pads does not undergo harsh bleaching
Modulus Tech, for example, devised a mortgage system such that the
procedures that would result in the production of a toxic substance known
house constructed by them would have to be owned by a female member
as dioxin. Therefore, they are healthier for use.” (Founder, Daisy)
of the family for them to avail the facility of the mortgage.
Similarly, the bloodless dialysis machine introduced by Byonyks was
“We want to promote female ownership of the houses to empower them
an affordable alternative for people willing to shift to peritoneal dialysis.
(women) and make them self-sufficient and strong”, asserted a co-
The device helped kidney failure patients to own a dialysis machine that
founder of Modulus Tech.
was affordable, pain-free, bloodless, and something that could be used in
the comfort of their homes, enabling those patients to save significant Daisy, meanwhile, worked tirelessly to remove the “social taboo”
treatment costs and continue earning their livelihoods and supporting around the menstrual hygiene of females through their hygiene camps
their families. One of the users of the Byonkys’ dialysis machine we arranged in the rural areas of Pakistan. They encouraged open conver
interviewed, for instance, expressed his gratitude: sations and teachings on menstrual hygiene to create a safe and healthy
lifestyle for females who otherwise were not sufficiently catered to by
“The quality of the treatment of a kidney disease in Pakistan is quite
large organizations.
bad. With little or no attention given by the doctors to the patients,
the patients are more prone to diseases like Hepatitis C which makes “One of our purposes is to alleviate the stigmas attached to menstruation”,
the entire healing process more painful and life threatening. How commented the co-founder of Daisy, “by letting women that it is
ever, Byonyks has saved me from the hassle and after shifting to the perfectly okay to have periods, it is not an illness, neither something out of
device I feel self-sufficient and safer”. ordinary, nor shameful, you know?“.
Frugal initiatives like Byonyks have made healthy lifestyles easily Such initiatives have led to the acknowledgment that gender inclu
accessible for people in developing countries. Such initiatives under FI in sion is vital in every realm of life. When it comes to empowerment,
Pakistan have enabled people, especially from middle/low-income another significant aspect is stress-free mobility and accessibility to the
segments, to conveniently opt for a healthier and safer lifestyle for public sphere, and for that, Jolta Electric introduced female scooties
themselves and those around them. currently imported from China, which women could afford for an easy
Sustainable entrepreneurship with FI has drastically improved the and reliable commute. The FIs in these aforementioned cases enabled
quality of life for people from less privileged backgrounds. Another females to access affordable transportation and property ownership
startup in our study, Modulus Tech, works to make dignified living while also enjoying a safe space for women-centric conversations, which
accessible to everyone mainly targeting the segments for whom con when comes all together, helps females feel more included and
ventional housing solutions remain unaffordable. The construction cost empowered.
in Pakistan has escalated many folds during the last few years due to an Environmental Outcomes: Sustainable entrepreneurship with FI has
unprecedented rise in labor and construction materials, which have actively enriched the prospects of doing environment-friendly business.
grown because of a surge in the industrial prices of gas and electricity. In Frugal start-ups in Pakistan have played a central role in endorsing
the absence of an effective welfare state, constructing a house of their sustainable lifestyles as the ultimate choice of living. For instance, the
9
entire business model of Jolta is based on a sustainable approach to development through FI also brought a general rise in inclusive eco
promote e-vehicles in the country and reduce carbon dioxide emissions nomic growth and opportunity creation. In the case of Jolta Electric, for
through transport. Their bikes use energy-conservative materials like instance, the founders of the company clearly affirmed that their mission
graphene, known for its battery storage quality. Simultaneously, the dry was to empower local people by teaching them skills of product as
battery used in Jolta’s electric bikes was specially manufactured to sembly that can be applied in any manufacturing business, as well as to
decrease air and noise pollution, as the founder proudly stated: integrate their business with local value chain partners who were mainly
comprised of small and micro enterprises.
“Our bike is pollution and sound free and, surprisingly, people are
enjoying these features a lot. Plus, there are no harmful emissions from “God has gifted me the wisdom to learn things at a faster pace so now it
our bikes due to our dry batteries, making the bike environmentally falls on me to spread my knowledge and enable people to become inde
friendly … We purposefully made it affordable so that more people can pendent. I shall use my light to lit other people … We have strategically
opt for a sustainable lifestyle.” (Founder, Jolta Electric). used the same small vendors who are making parts for other motorbike
assemblers; it upgrades their (vendors) skills and saves my cost” (Co-
Another example is Modulus Tech which has been mindful of
founder, Jolta)
reducing the carbon footprint of its housing solutions to push for a
sustainable lifestyle. Through their model, they aim to reduce the carbon Jolta Electric created an ecosystem of team leaders, researchers,
footprint and emission of greenhouse gases by 50 times in contrast to the assemblers, vendors, sellers, and manufacturers working under the
traditional construction methods. Their houses are carbon neutral (net network of electric vehicles in Pakistan. FI relies heavily on using local
zero carbon emission) and come equipped with their own insulation, raw materials and labor, creating business opportunities for local small
renewable energy supply, and solar-powered water purification systems. and micro businesses. For instance, the biodegradable pads manufac
tured by Daisy were made of local materials purchased from the markets
“Our houses are constructed in days, substantially reducing their carbon
on the outskirts of Lahore. Ez-Shifa, through its franchising model,
footprint and operate off-grid with their own renewable solar energy and
created self-employment opportunities for locals in underprivileged
solar charged water purification systems.” (Co-founder Modulus Tech)
areas. While Ez-Shifa was responsible for providing the kiosk, techno
Similarly, sanitary napkins by Daisy were made of a biodegradable logical support, and arranging doctors for online consultation, the local
material that reduced plastic waste. As the founder of Daisy regathered franchisee would own the space and manage the on-ground operations.
some thoughts from her past: They worked on a revenue-sharing model where the franchisee would
get 60% of the patient fee, and 40% would go to Ez-Shifa.
“I grew up looking at heaps of trash around me where they’d be napkins
lying around as well which would become a vector for infection. So, I “We have deployed our kiosk in Tharparkar (an extremely impoverished
always knew I wanted to create something that is cost-effective and good area in the deserts of Sindh) where a PhD doctor bought it (Apna Doctor
for the environment.” Kiosk) for the people of his village, the clinic assistant is also a local from
that region.” (Co-founder, Ez Shifa)
Even the water filters manufactured by Pak Vitae purified water
without any power requirement making them environment friendly. Such mindful production steps to develop sustainable products
Enterprises relying on FI have paved new ways to encourage people to unlocked new avenues for inclusive economic growth. The cases of
opt for a sustainable lifestyle without compromising their quality of life. sustainable entrepreneurship using FI not only allowed start-ups to
flourish but also instrumental in creating new markets in a developing
“We have manufactured a low-cost, membrane-based solution for the
country. All the six cases of FI examined in this study have developed
water filter that requires no electricity or chemical cleaning therefore you
products based on proprietary technologies mostly conceptualized and
can easily access clean drinking water without being dependent on the
designed by the co-founders themselves. As a result, they offered more
electricity supply.” (Co-founder, Pak Vitae)
economical, sustainable, simpler, and more efficient alternatives to
FI not only promote a sustainable lifestyle by offering existing products with a strong potential to replace the incumbents. For
environmental-friendly products, but they also incorporate elements of example, Pak Vitae’s point-of-use filters have already eliminated the
sustainability in their production techniques. Most of the startups need for MNCs’ traditional water dispenser bottles. As explained by a co-
studied primarily opted to substitute synthetic raw materials with founder of Pak-Vitae:
organic raw materials. For example, as the founder of Daisy explained,
“One of our products in the pipeline is a fancy tap. It is a high-end
“We use local cotton as the top layer of our pads to promote healthy and
product for the hospitality industry. Hashu group (a big hotel
sustainable production.” Similarly, some of these start-ups placed great
chain in Pakistan) has 3000 rooms, in different regions and we will
emphasis on optimizing the use of raw materials and incorporated
basically use this tap in their washrooms essentially turning your tap
certain measures in their manufacturing techniques to minimize the
water to drinking water, therefore, eliminating the use of conven
quantity of material used. For instance, Modulus Tech employed several
tional water bottles”
passive and active strategies in its manufacturing processes to ensure
that its production is sustainable and environmentally friendly. As Similarly, Ez-Shifa’s Apna Doctor Kiosk had rendered traditional
fondly shared by a co-founder of Modulus Tech: clinics obsolete in rural areas due to its use of technology and signifi
cantly greater scalability potential. Appendix A outlines the market
“Our flat-pack assemblance technique guarantees energy conserva
performance of these startups more specifically. The disruption potential
tion and by optimizing space and time, we efficiently ship more sets
of low-cost goods also boosts the export potential of developing coun
of housing in the same shipment. This optimization also reduces the
tries such as Pakistan. Unlike traditional products, which often compete
fuel consumption yet again adding to the sustainability of their
with more competitive products in mainstream markets, frugal products
product”
have the ability to access untapped markets in similar developing or
Ez-Shifa’s Apna Doctor Kiosk allowed their franchisees and patients undeveloped countries with greater ease. For example, Pak Vitae and
to go completely paperless, with all the medical records being stored Modulus Tech have already created a dealer network for their water
electronically on a centralized cloud server. It can, therefore, be argued filters and prefabricated housings in a few African countries. Byonkys,
that products based on FI cannot only enable resource-constrained meanwhile, was in dialogue with certain distributors in Nairobi. Ez-
people to improve their social well-being but also assist them in Shifa was also developing a more advanced version of its product (an
choosing a more environmental-friendly lifestyle. AI-enabled kiosk) for the South African, American, and Middle Eastern
Economic Outcomes: Our cases exhibited that sustainable markets. By virtue of its export potential, sustainable entrepreneurship
10
using FI can improve the country’s development prospects, leading to business opportunities in resource-constrained environments. This pro
economic opportunities and inclusive growth and improving the quality vides a more holistic view to understand better the mechanism behind
of life for its citizens. the origins of FI and its influence in identifying and exploiting frugal
To summarize, when leveraged with FI, sustainable entrepreneur innovations with socio-environmental benefits. Given that resources are
ship can potentially lead to inclusive and progressive growth, especially challenging to obtain for sustainable businesses, our study contributes to
in a resource-constrained context of a developing country. We found FI literature by revealing aspects that can foster sustainability-oriented
that targeting the needs of the low and middle segments of society re FI.
mains to be the key motivation and focus of such businesses, unlike Finally, Pakistan’s context represents developing countries in the
conventional entrepreneurship. Resultantly, it ensures the penetration mainstream literature on sustainable entrepreneurship, which is mainly
of sustainable products to the lowest cadre of the market. explored in developed countries (Argade et al., 2021a,b; Terán-Yépez
and Marín-Carrillo, 2020). Given the pressing challenges of resource
5. Discussion scarcity in developing countries, our research shows that FI-based sus
tainable entrepreneurship has the potential to offer cost-effective solu
This study adds a fresh theoretical perspective to the existing sus tions that have economic, social, and environmental benefits. For
tainable entrepreneurship literature by demonstrating how sustainable instance, we find that sustainable entrepreneurship empowers access to
entrepreneurship with frugal solutions can serve low segments of society a healthy lifestyle, manufacturing affordable yet quality health care,
in a resource-constrained setting and plays a central role in developing housing solutions, water filtration, and transportation solutions. The
products/services in a sustainable manner. The role of sustainable easy access to affordable products has considerably improved the
entrepreneurship has been extensively explored in adding value to the quality of life of underprivileged people residing in remote areas. Like
social, environmental, and economic well-being of people in the devel wise, our study demonstrates several ways in which sustainable entre
oping world. Through this research, we bridge two interrelated yet preneurship facilitates an environment-friendly business approach,
distinct streams of literature, i.e., sustainable entrepreneurship (Anand which is ignored in conventional business practices. Climate change has
et al., 2021; Muñoz et al., 2018; Shepherd and Patzelt, 2011) and frugal become a global issue, however, due to the environment-friendly
innovation (Levänen et al., 2016; Albert, 2019; Hossain, 2021), and approach, sustainable entrepreneurship has paved the way for a sus
thereby contribute by theorizing FI as a source to nurture sustainable tainable environment for business growth. For example,
entrepreneurial opportunities that directly improve energy-conservative housing designs, powerless manufacturing, usage
socio-environmental conditions (Muñoz et al., 2018). We also connect of local and raw materials, optimal operations, and substitution to
market imperfections and entrepreneurial opportunities in developing renewable energy consumption have cultivated a sustainable lifestyle. In
countries in line with the prior research suggestions (Cohen and Winn, the context of Pakistan, sustainable entrepreneurship has helped con
2007). Finally, our research reveals various factors that encourage sumers opt for online medical consultation, electric transportation,
FI-based sustainable entrepreneurship. solar-powered and low carbon-footprint housing options, biodegradable
menstrual pads, and zero-power water filters. All the frugal products
5.1. Theoretical implications have paved the way for a sustainability-driven and environmentally
friendly lifestyle. Furthermore, this study also adds to the existing
Our research enlightens that FI literature has several overlaps with economic-centric view of sustainable entrepreneurship. The outcomes
sustainable entrepreneurship outcomes, yet scholars have not paid suggest that sustainable entrepreneurs contribute to the social and
attention to integrating these two streams of research. Therefore, this economic growth of the developing world by creating new markets with
study is the first of its kind to offer an integrated framework for sus affordable quality products for low-income customers.
tainable entrepreneurship based on FI. Thus, the study offers three key
contributions to the literature. First, scholars have a dominant under 5.2. Practical implications
standing of additional risks and challenges associated with sustainable
entrepreneurship (Dawo et al., 2022; Hoogendoorn et al., 2019). It could This study has crucial implications for practitioners to promote
be difficult to discover sustainable opportunities (Argade et al., 2021a,b) sustainable development by integrating frugal innovation with sustain
due to perceived lower profitability (Shahid, 2022), customer buying able entrepreneurship. Our study demonstrates numerous ways in which
behaviors (Shahid and Reynaud, 2022), market imperfection (Kuckertz sustainable products can serve low-income customers in resource-
and Wagner, 2010) and entrepreneurial ecosystem (Dawo et al., 2022) constrained developing countries. The essence of FI with sustainable
that impede sustainable entrepreneurship. The case for developing development is to meet the needs of low-income customers by offering
countries can be even worse in terms of exploiting sustainable business affordable and quality solutions, promoting cleaner production pro
opportunities due to limited resources. Therefore, there is a need to cesses, using recycled materials, and encouraging sustainable goods and
advance the literature on sustainable entrepreneurship by focusing on services. In such cases, FI shows ways to substitute costly products with
its enablers rather than barriers, especially in resource-constrained set affordable products entailing desirable characteristics, for example, ease
tings (Hoogendoorn et al., 2019; Shahid, 2022). By theorizing FI as an of use and reparability. As our cases demonstrate, sustainable entre
inexpensive solution, we demonstrate that FI has the potential to preneurship based on FI leads to technological development to meet the
encourage sustainable entrepreneurship in resource-constrained envi social and economic needs of developing countries that conventional
ronments. Using in-depth case studies, we are able to demonstrate that entrepreneurship tends to ignore. Therefore, focusing on FI can teach
despite limited resources, if entrepreneurs employ FI in exploiting entrepreneurs ways to enhance inclusive growth and sustainability in
business opportunities, they can achieve the triple-bottom-line objec developing countries. In addition, entrepreneurs need resources to
tives of sustainability. Furthermore, this theoretical link between FI and exploit business opportunities (Muñoz and Cohen, 2018), in that
sustainable entrepreneurship calls for further research to identify some essence, FI suggests identifying and exploiting sustainable business op
boundary conditions under which this association works in the best in portunities that could be developed with limited means, helping both
terest of sustainable business opportunities. the entrepreneurs and society.
Second, we contribute to FI literature (Albert, 2019; Hossain, 2021; Sustainable entrepreneurship considers factors such as social needs,
Levänen et al., 2016) by offering prospective elements that could trigger context, and environment to develop frugal products by closely
FI leading to sustainable entrepreneurship. As such, we unfold that en engaging with the customers and community to ensure their feedback is
trepreneurs’ personal characteristics, networks, and inspirations are incorporated into product development. They pay close attention to the
factors that assist them in identifying and exploiting sustainable pressing social issues to create a sustainable place for the customers.
11
Sustainable entrepreneurship with FI leads to social and business growth sustainability is necessary to tackle the growing grand challenges.
while also meeting the needs of low-income customers. Therefore,
practitioners must acknowledge the growth that comes with FI and 6. Conclusions
devise strategies to create an inclusive business environment for FI.
Conventional firms may learn from the entrepreneurs practising FI to Sustainable entrepreneurship has emerged as a way to solve many
revise their sustainability orientation, production mechanisms, and environmental issues. Likewise, many aspects of FI are associated with
efficient use of resources that ultimately promote sustainable business sustainability (Levänen et al., 2016). Our study aims to theorize FI as a
practices and inclusive growth. FI can be viewed to generate new sus source of sustainable entrepreneurship, depicting these two as inter
tainable models to strengthen the positive impact that businesses can twined phenomena in a resource-constrained setting. We conclude that
create. Researchers and policymakers can study frugal ventures to learn first, there are individual specific elements, such as personal character
how grand challenges can be addressed through entrepreneurial inter istics, networks, and inspirations that help entrepreneurs identify FI
vention and promote sustainable development goals in developing opportunities that further leads to sustainable entrepreneurship. Second,
countries by creating a conducive environment for FI. in our cases, the sustainability aspect meets the triple bottom line per
spectives, indicating that FI-based entrepreneurship simultaneously
5.3. Limitations and future research avenues contributes to economic, social, and environmental fronts. Finally, as our
study shows, sustainable entrepreneurship in a resource-constrained and
There are several limitations of this study, which open future developing country context is a means of sustainable economic growth.
research avenues. We selected six cases to explore sustainable entre Creating new customers, new market segments, self-employment op
preneurship with FI in Pakistan. However, exploring more cases from portunities, and business opportunities for local small and micro busi
diverse sectors would provide a more holistic understanding of FI. nesses all result in inclusive economic growth and opportunity creation.
Another limitation is that we did not explore the customers’ perspec
tives. Due to resource and logistical constraints, such as physically CRediT authorship contribution statement
conducting interviews, identifying relevant customers, seeking consent
from selected cases, and time constraints, we could not approach the Muhammad Shehryar Shahid: Conceptualization, Methodology,
customers of our cases. The customer’s perspective will help revealing Formal analysis, Data curation, Writing – original draft, Writing – re
more realistic insights into how FI contributes to their social and eco view & editing. Mokter Hossain: Conceptualization, Methodology,
nomic wellbeing. Formal analysis, Writing – original draft, Writing – review & editing.
Future research can refine and extend this relationship in a different Subhan Shahid: Writing – original draft, Discussion, Implications,
setting. Moreover, it provides a qualitative narrative to solidify the link Validation, Writing – review & editing. Tehreem Anwar: Conceptuali
between sustainable entrepreneurship and FI. However, a quantitative zation, Formal analysis, Data curation, Writing – original draft.
research approach can further testify to this link. Future research may
explore how the products and services developed under FI contribute to Declaration of competing interest
the prosperous growth of all social groups. Our empirical work can be
seen as a call for an in-depth analysis of how FI can lead to sustainable The authors declare that they have no known competing financial
development and how it can solve issues like access to healthcare interests or personal relationships that could have appeared to influence
(Agarwal et al., 2020), women empowerment (Hossain, 2021), access to the work reported in this paper.
energy (Bas, 2020) and safe housing (Dressler and Bucher, 2018).
Similarly, future research can develop frameworks to identify how sus Data availability
tainable entrepreneurship with FI can help a community grow on eco
nomic, social, and environmental fronts and therefore help tackle Data will be made available on request.
sustainable goals directly by stressing on sustainable business models.
The existing literature on the relationships identified in this study is Acknowledgements
limited; therefore, future research in other contexts to compare the
findings of this study and develop a strong policy landscape for FI and Open Access funding provided by the Qatar National Library.
Appendix A. Overview of the cases
Case Name Description
Byonyks Byonkys is a medical device firm founded and managed by a passionate computer scientist who graduated in 2003 from a renowned university in Pakistan and has
had extensive experience of 15 years working for medical device companies in the USA. Operational since 2017, it provides a portable and bloodless dialysis machine
(Byonyks X1) targeted at patients living in a resource-constrained environment of a developing country. Having been rejected by US companies to launch their
portable dialysis machine in Pakistan, which they deemed to be a low-margin market, the founder of Byonyks, as passionate as he was, took it upon himself to
develop and manufacture a portable dialysis machine in Pakistan that would cost around 10 times less expensive than the American version. Given the lack of local
expertise, Byonkys has capitalized on seasoned American industrial experts and academicians to be able to design, develop and assemble the dialysis machine in their
labs in Pakistan. Having run successful prototyping with six local patients and two private hospitals for almost a year, the company is all set to commercialise its
frugal product. The current headcount of the company is 80. A state-of-the-art factory has already been established in Lahore, Pakistan, with all the regulatory
approvals attained. Byonkys also maintains an R&D and Innovation centre one each in Lahore and Chicago, USA.
Daisy Having observed and personally experienced the social taboos associated with menstrual issues and hygiene for females in Pakistan, a final-year female medical
student established a company called Daisy in 2016. Daisy developed an affordable and eco-friendly sanitary napkin mainly sold to poor women living in rural areas
of Pakistan. Although the venture has remained mainly self-funded to meet its operational expenses, there were some successful crowdfunding campaigns organized
by the founder in her school and university to raise the startup capital. Distributed through partnerships with local NGOs, the sanitary napkins by Daisy give rural
women access to an economical but equally efficient substitute for expensive off-the-shelf products, a market largely dominated by multinational companies. A part
of Daisy’s sales also comes from affluent women living in urban areas who would buy these sanitary napkins through the social media pages of the company. While
the founder herself does the product designing internally, the manufacturing is completely outsourced to small vendors in the outskirts of Lahore. 100% of the raw
material is sourced locally from places in close proximity to manufacturing sites. The value proposition of the product does not only lie in its low price, but also in its
(continued on next page)
12
(continued )
Case Name Description
three-layered product design and substitution of synthetic materials with a more eco-friendly material like cotton. It was a service designed to address the underlying
social taboo.
Ez-Shifa Ez-Shifa is a Seattle, WA, USA-based technology start up making “quality healthcare” accessible to all. Founded in 2018 by three technologists and entrepreneurs
from the UK, USA and Pakistan to make primary healthcare ubiquitous, especially concerning the underprivileged people in Pakistan. Using cutting-edge
technologies such as video conferencing, computer vision, AI/ML and NLP, Ez-Shifa brings about the integration of healthcare services by connecting doctors with
patients, and patients with pharmacies, labs, and other services, all from one platform. The product under investigation, however, is Apna Doctor, a technology-
enabled Kiosk for medical consultations. Integration of simple off-the-shelf gadgets in a wooden structure backed by a SaaS-based digital platform has enabled people
from underprivileged areas of Pakistan to seek healthcare consultations from doctors based in developed countries. By installing 30 Kiosks through a franchising
model mainly at rural or suburban sites, Ez-Shifa had so far served about 500 patients for only one-fourth of the price generally charged by a private doctor in
Pakistan. With two Kiosks of Apna Doctor already in Nigeria, Ez-Shifa is geared to solve healthcare problems in other resource-constrained environments too.
Jolta Electric Climate change and pollution are becoming issues of a disastrous magnitude in Pakistan, most commonly manifested as floods, food insecurity and dismally poor air
quality index in urban areas. Responding to these challenges, two engineers from Pakistan launched Jolta Electric in 2021, which is claimed to be the manufacturers
of Pakistan’s first approved electric bike. The incumbent Prime Minister of Pakistan at the time of the interview inaugurated Jolta’s factory, which proved to be a
major hype-catching event and gave it a kick-start. Together with their vast entrepreneurial and industrial experience both locally and in China, the two co-founders
developed a proprietary electric kit that could fit in any existing conventional bike to turn into an electric vehicle. To maintain the frugality of the product, Jolta
avoided the need to innovate around design at this stage and simply replicated the design of existing bikes with their proprietary electric kit installed in them. With
the network of 100 dealers across Pakistan, Jolta was selling on average 5000 units per months in 2021, whereby all the bikes are assembled in-house at their Lahore
based factory. Jolta’s frugal innovation has made electric bikes, which otherwise are all imported and very expensive in Pakistan, a product for the masses.
Modulus Modulus Tech is a Karachi based company in Pakistan, which manufactures prefabricated sustainable and affordable houses using their proprietary inter-mesh
Tech technology. With little money and tons of passion, and inspired by the Syrian refugees crises, three final year students of civil engineering, founded Modulus Tech in
2016 to provide sustainable living and housing facilities for displaced and homeless people in developing countries. With their families already being in the
construction business gave the co-founders a good knowledge of the industry and its value chain. The industry of prefabricated housing in Pakistan is dominated by
players who import standard structures from China and use them to construct either industrial buildings or small luxury houses. Modulus Tech with their 100% local
production, better technology, lower cost and significantly less processing time, is rather targeting low-income workers living in urban areas (e.g. domestic workers,
electricians, and drivers). Till the mid of year 2021, Modulus Tech had constructed 70 units (300–400 sft in size) in various parts of Sindh and Baluchistan, while 17
community houses were under construction in Karachi, Pakistan. Moreover, a house constructed by Modulus Tech, if financed through their mortgage partner, must
be owned by a female member of the family applying for the mortgage. Besides promoting female empowerment, Modulus Tech directly contributes to solving
environmental problems by making all their houses energy-efficient and solar-powered.
Pak Vitae Founded by two chemical engineers in 2017, Pak Vitae is a company driven by the mission to provide innovative and sustainable technological interventions that can
alleviate the waterborne disease burden and save millions of lives around the globe. Triggered by the personal passion and suffering of one of the founders with
chronic diarrhoea after drinking contaminated water during his university time, the idea of developing an affordable detachable water filter was conceptualized.
Their Point-of-Use (POU) water filer is built on proprietary anti-bacterial hollow fibre member technology. Operating within an environment characterised by the
lack of scientific knowledge on fibre technology, testing facilities and manufacturing equipment, the founders of Pak Vitae aggressively established and leveraged
international networks constituting of academicians, industrial experts and designers of hollow fibre membrane. For fund raising and business mentoring, however,
they relied largely on local partners. Grants and the prize money of various competitions funded the initial product development and testing. Given the institutional
inefficiencies of Pakistan, the company, though based in Pakistan, is currently registered in Singapore in their bid to raise international funding and avoid certain
complications related to taxation. Targeting the lower-middle customers, Pak Vitae had sold approximately 7000 units of their POU filters, where 75% of those were
sold in either small cities or rural areas of Pakistan until the start of 2022.
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Journal of Cleaner Production 406 (2023) 137050

Contents lists available at ScienceDirect

Journal of Cleaner Production

Frugal innovation as a source of sustainable entrepreneurship to tackle

1. Introduction Responding to the debate on the challenges associated with sus­

-Kiosks with integrated required to operate the USA and UK.

Journal of Cleaner Production 406 (2023) 137050

primary and secondary sources used to collect data. After significant

-Export of POU water filters to African

Singapore to facilitate trade and

each founder studied before scheduling an interview. Afterward, each

filter the water of bacteria and

-Replaces the use of plastic

two included detailed tours of Byonyks’ factory and headquarters, both

senior company manager gave a guided tour of the factory, simulta­

the HR manager of Bynoyks gave a comprehensive tour of all the de­

superior lifespan of the filter

partments operating in Byonyks head office. This was followed by an in-

insights on the portable dialysis machine.

research for this paper. As outlined in Table 2, for secondary data

with a headcount of only

-Very lean organization

websites, Facebook, and LinkedIn pages. Moreover, videos referring to

customer reviews, product specifics and co-founders’ TV interviews

were thoroughly examined by the co-authors, with a total duration of

approximately 300mins, which was later transcribed.

3.5. Data analysis

For data analysis, we used NVivo, which is a powerful software to

organize, code and analyze qualitative data. An inductive approach was

used to develop a framework linking the under-explored relationship

Considering sustainability literature, we made three aggregate di­

-The athlete water bottle

initial coding focusing on how sustainable entrepreneurship through FI

has led to an enhanced standard of living and an environmentally

the economy. Next, we merged similar codes in accordance with our

first-order categories. For instance, “the kiosk by Ezshifa provides online

the remote areas of Pakistan” were combined as a first-order category of

“affordable and easily accessible online medical consultation.” This

first-order category led to the second-order theme of “access to a healthy

mensions. Fig. 1 outlines the structure of our data analysis in detail.

themes that we subsequently merged to form three aggregate di­

• Co-founder (02 interviews)

tion then elaborates in detail on the economic, social, and environ­

mental outcomes of entrepreneurship using FI. Based on our findings,

Institutional voids, such as inadequacy of public goods and services,

to sense entrepreneurial opportunities so entrepreneurs can come up

context, factors like entrepreneurial alertness, social aspirations, and

networks of the founders play a significant role in the identification and

Firstly, entrepreneurial alertness plays a pivotal role in the devel­

solutions, especially in the low end of the market, by combining

entrepreneurs demonstrated a strong awareness of the changes, oppor­

tunities, and overlooked possibilities in their respective industries and

Beijing Olympics in 2008, as he recalled:

Overall, the entrepreneurial alertness of entrepreneurs pushes for the

identification of FI opportunities for sustainable products. Secondly,

every individual, regardless of socioeconomic class, an equal opportu­

sponsibility toward society:

• Chief Medical Officer

“I have this addiction to meeting human potential which I think is to

1. Introduction Responding to the debate on the challenges associated with sus

senior company manager gave a guided tour of the factory, simulta

the HR manager of Bynoyks gave a comprehensive tour of all the de

Considering sustainability literature, we made three aggregate di

themes that we subsequently merged to form three aggregate di

tion then elaborates in detail on the economic, social, and environ

Firstly, entrepreneurial alertness plays a pivotal role in the devel

entrepreneurs demonstrated a strong awareness of the changes, oppor

every individual, regardless of socioeconomic class, an equal opportu