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After going to the Digital Health Festival (DHF) in Melbourne last week, one thing stood out: healthtech in Australia has real momentum - but not all in the same direction. You could almost divide the event in two.
One side of the room was filled with fast-moving, slightly chaotic, founder-led startups - AI scribes, wellness tools, digital therapeutics - building for clinicians and patients. The other was dominated by sterile, enterprise booths from the likes of Oracle, Infosys, SailPoint, and Imprivata, showcasing data infrastructure and compliance tools.
One way I’m beginning to think about healthtech innovation is through the lens of frontend vs backend:
- Frontend HealthTech: Tools that are directly used by clinicians, patients, or consumers. These tend to be quicker to build, easier to distribute, and faster to monetise.
- Backend HealthTech: Infrastructure like data platforms, workflow automation, clinical trials and compliance tools. These take longer to sell and build trust, but are often foundational to how the system operates.
Both layers matter - but they behave very differently. And each one presents different opportunities (and constraints) for early-stage founders and investors.
Frontend HealthTech: usability, traction, and faster cycles
1. AI scribes are no longer emerging - they’re mainstream
At DHF, AI scribes were everywhere. Heidi, Lyrebird, VoiceBox, i-Scribe, and others were all tackling clinical documentation to reduce burnout and improve efficiency. It’s a real problem space, but the category is now crowded, and many of the demos are starting to look similar.
Differentiation is now about:
- Workflow depth
- EMR or billing system integration
- Targeting overlooked verticals like allied health or aged care
Players like Heidi and Eucalyptus are moving fast and embedding themselves deeply within healthcare workflows - no longer early-stage experiments, but not yet incumbents. Their booths at the event had the enterprise-esque sterility, reflecting what felt like an attempt to align with incumbents. Blackbird’s original investment notes on Heidi (then Oscer) describe a broad thesis around helping doctors. Fast forward four years and their current branding now clearly signals a doubling down on AI scribing as the core product.
2. Consumer-first health is gaining ground - and going deeper
Preventative and everyday health - from mental wellbeing to chronic condition management - is attracting more founder and investor attention. These companies aren’t waiting for hospital procurement. They’re going direct to patients, primary care providers, or smaller clinics, and building for usability and outcomes.
Local startups like Everlab and Superpower (we’ll claim it as local, but it’s not really) are good examples. Both have successfully broken into the top layer of healthcare - diagnostics and primary care - by simplifying access, owning the consumer experience, and meeting people where they are. Superpower focuses on prevention-based testing and treatments, rather than acute or emergency care.
This gives them a foothold to move further down the value chain, with potential to own the full journey over time.
I agree with what I’ve been hearing in every startup/healthtech/VC/finance bro podcast lately - “The next trillion-dollar company will be in healthtech.” It’s a bold call but if it’s going to happen, I think it will be in this category.
3. Founders (or VCs?) are prioritising early revenue and tight loops
Across the board, founders are getting closer to the money. Many are targeting GPs, allied health, or consumers directly - finding ways to test and monetise quickly rather than waiting 12–18 months for a hospital contract.
Most of the startup activity at DHF fell into this frontend category. Maybe it’s because we’re all consumers and we instinctively understand the problems here. Or maybe it’s because early-stage fundraising now expects real traction and revenue, and that’s incredibly hard to deliver when your first customer is a public hospital on a 9-month buying cycle.
One of the most pragmatic sessions I watched at DHF was “Agile R&D and codesign in digital health”, led by Prof. Rashina Hoda and A/Prof. Peter Poon from Monash University. Their main reminder, in Peter Drucker's words:
“You can’t improve what you can’t measure.”
It applies to product, outcomes, and fundraising. Investors want to back things that look like they’ll improve over time - and to prove that, you need a way to measure progress early.
The best founders seem to be balancing fast execution with scientific thinking - hypothesis, test, iterate - while still shipping quickly and listening closely to the user.
Backend HealthTech: slow burn, deeper value
1. Interoperability is still a major constraint
A recurring theme throughout the festival: systems still don’t talk to each other. Whether it’s EMRs, clinical trial matching, or patient referrals, the lack of clean, connected data remains a fundamental blocker.
Startups are increasingly going after this with middleware, APIs, and integration platforms - trying to create the connective tissue that makes the rest of the system work.
As Airtree put it:
“The desperate need for cost reduction and better outcomes will force governments to evolve regulation and drive new incentives for payers and providers.”
That shift, toward outcomes and efficiency, won’t happen without interoperability.
2. Automation in ops has a lot of opportunities
Claims, onboarding, referrals, compliance - these aren’t the most visible parts of healthcare, but they’re where a lot of the real inefficiency lives. More startups are now quietly tackling these layers.
Lyngo is a good example of a generalist automation tool finding relevance in healthcare. These tools may not be flashy, but they save time, reduce admin burden, and open the door to more scalable operations.
Founders who understand the flow of data and money through the healthcare system - and how incentives are structured - are better placed to succeed here. If you know who the actual decision-makers are (hospital administrators, not clinicians), and you can reach them, you’re in a strong position. Products that align with operational KPIs tend to get bought faster - especially in under-digitised back-office workflows.
3. Enterprise is active - but startups can still win on focus
Some of the largest booths at DHF belonged to big tech players - Salesforce, Microsoft, Ingram Mico - but many offerings felt broad or unclear. In his session “The Advent of AI Agents in Health and Medicine”, Dr Stefan Harrer, Director of AI for Science at CSIRO, talked about how NVIDIA has partnered with the likes of Foxconn and GE Healthcare recently in an effort to capitalise on this space. There’s definitely interest from enterprise in healthcare infrastructure, but the product-market fit still feels fuzzy in parts and with potential for significant M&A.
That leaves room for focused startups solving sharp, specific problems - especially around compliance, integration, or workflow efficiency. These aren’t always the biggest markets, but they’re sticky once integrated and valuable if you build into real systems.
Another point Dr Harrer made was: once you stack autonomous tools, risks compound quickly. Without clinical validation and interpretability, things could break down. Founders building infrastructure or decision-support tools will need to prioritise transparency from day one and stay close to regulators.
Final thoughts
Healthtech in Australia is evolving and so is the way it’s being built.
- The frontend is where speed and traction are most visible - particularly for tools that deliver immediate value to patients or clinicians.
- The backend is slower, but foundational - offering whitespace for teams building trusted infrastructure and system enablers.
- Macro trends - rising costs, ageing populations, chronic disease - are creating demand for smarter, more scalable care.
- And the move toward outcomes over volume is shifting incentives - slowly, but steadily
There’s still no easy path in healthtech. But the best founders are picking a sharp wedge, shipping quickly, staying close to their users - and building for where the system is heading, not where it’s been.
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