At LSI Europe, a panel of operators and investors gathered to tackle one of the most complex and consequential challenges facing the industry: how to create, deliver, and capture value in digital health. With new technologies transforming how care is delivered, from telepresence and remote monitoring to robotics and AI, the design of digital health business models has never been more important or more difficult to define.

As Joe Mullings, who moderated the conversation, noted, “The digital environment is still being defined,” and that ambiguity makes business model design a moving target. But what emerged from the discussion was a compelling look at how innovators are thinking about value creation, defensibility, and reimbursement in a world where the product is often not a physical object, but a layer of software, data, and workflow transformation.

From Devices to Data: Redefining Value in the Digital Era

The panel brought together a diverse set of voices: Bryn Davies, Addie Harris, and Boaz Lifschitzs. Each came with firsthand experience commercializing or investing in software-enabled healthcare technologies.

For Lifschitz, the bar for investment in digital tools is the same as it is for physical devices: “It can’t just be some kind of technology that enables better information,” he said. “It has to have a medical impact per patient.” That requirement shapes everything, from regulatory expectations to commercial strategy. “We debated what the right approach would be,” he added, “but in the end, we treat digital almost like a device.”

Harris emphasized that while robotics may seem like hardware-first plays, they are increasingly valued for their software. “Robots are often Trojan horses to bring digital into the OR,” she said. “Surgeons will tell you, ‘I’m using it for the software.’ They can’t go back once they’ve experienced that layer of data and usability.”

Designing and Defending Digital Health Business Models

A key thread throughout the panel was that “business model” means more than how a company makes money. It also includes how the product is delivered, who benefits, and how to build in long-term defensibility.

Davies emphasized the importance of understanding where value lies. “When you talk about robotics, not just orthopedics but more broadly, we’re seeing the ability to connect contextual data, video, audio, with device data. Suddenly, you not only know the numbers but also the ‘why.’ That’s where Proximie marries really well with emergent technologies to give context.”

Context, as it turns out, can be critical not just for patient outcomes, but for training and product development. Harris shared a case where software analytics uncovered a problem not with the robot, but with the registration technique used by a highly experienced surgeon. “We had to be careful how we told him,” she said, “but it told us our training wasn’t good enough. That feedback led to changes that drove adoption.”

Lifschitz noted that while digital tools often come with shorter commercialization timelines than traditional devices, they carry just as much uncertainty, if not more, when it comes to business model clarity. “There’s some leap of faith required,” he said. “We try to do the due diligence, but the model often isn’t obvious at the start.”

Strategics, Payers, and the New Centers of Gravity

The panelists also acknowledged that traditional acquirers are not always ready to absorb digital solutions. “These companies are not built to build, sell, or support digital,” said Harris, who previously led digital efforts inside J&J. “The majority of digital development is going to happen outside the big companies, and it’s going to come in through acquisition. But there’s a high chance those solutions die inside the acquiring organization if they don’t know how to manage them.”

To navigate that, she advises founders to think early and often about exit strategy and who the likely acquirers are. Lifschitz agreed, adding that investors now have to maintain relationships with both traditional medtech giants and new entrants like Amazon, Google, and Nvidia. “Suddenly, you have new strategic players in the game,” he said. “They all want to enter the data space.”

That shift is already affecting how companies frame their value proposition. “We’re talking to telcos and platform providers as partners,” said Davies. “We can white label Proximie, integrate it into other systems, and help those companies scale globally without having to rebuild infrastructure. That’s value.”

Revenue Streams, Reimbursement, and Repeatability

Panelists discussed a range of revenue models, from capital sales to per-click fees to SaaS subscriptions. But the most effective business models, they agreed, are multifaceted and repeatable.

“Intuitive has been so successful because most of their revenue comes from recurring sources,” Harris explained. “If you only rely on capital, it’s easy to get displaced from the market. With per-click and service contracts, you build stickiness.”

That shift from CAPEX to OPEX is reshaping how hospitals and acquirers evaluate digital tools. “We also started to think less in capital business models,” said Lifschitz. “We’ll definitely look at different models in the future. The world is going in that direction.”

As Davies noted, digital health business models must start with a clear strategic goal. “Are you trying to gain share? Drive revenue? Build defensibility?” he asked. “All those decisions, pricing, delivery, value creation, fall out from that.”

A New Playbook for Digital Health Business Models

Digital health is no longer a niche category; it’s a driving force behind how care is evolving. But building a company in this space requires more than just novel technology. The panelists at LSI Europe made it clear: success in this landscape hinges on thoughtful, adaptive digital health business models that account for reimbursement, usability, acquirer readiness, and the right partners at every stage.

“Don’t be afraid to be bold,” said Harris. “There are models out there we haven’t thought of yet, and they could be the deciding factor in your success.”