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With real-world answers from Hilti, Swapfiets, Loopz, and more
Summary written by P2S
Based on a conversation between Florian André (P2S) and Scott Galvao (Circuly)
- Watch the full discussion here: Product-as-a-Service is the Future
- Full blog article available at Circuly: Top 11 Questions About Product-as-a-Service (PaaS)
What’s driving the shift to subscription models for physical products? And what separates companies that get it right from those that stall?
These are the questions we hear every day at P2S. That’s why we sat down with Scott Galvao (Circuly) to unpack the 11 most common ones - with examples from real-world PaaS companies. Below is a summary of the first key insights. For the full discussion, including tactical details and further examples, check out the complete blog on Circuly’s site.
1. Why are companies shifting to subscription-based models?
From a manufacturer’s view, the benefits are both financial and strategic:
- Predictable revenue: Subscriptions smooth out demand cycles and reduce forecasting headaches. Companies like Hilti now generate 80%+ recurring revenue.
- Lifecycle monetization: Instead of a one-time sale, the product continues to generate revenue across repairs, upgrades, and reuse cycles.
- Sustainability gains: PaaS models align with circular economy goals and reduce waste - fitting nicely with rising regulatory pressure in the EU and beyond.
- Shorter sales cycles: Especially in B2B, turning CapEx into OpEx simplifies the procurement process and speeds up decision-making.
From the end-customer’s side, access, affordability, and convenience take center stage. Try-before-you-buy and ongoing service are attractive alternatives to large upfront investments.
2. Which industries are a natural fit for PaaS?
Florian (from a B2B lens) and Scott (from a B2C view) highlighted the following:
B2B
- HVAC & energy tech – OpEx-based offers for complex systems
- Healthcare equipment – From dental chairs to defibrillators
- Manufacturing assets – Including core machinery parts on subscription
- Industrial consumables – Spare parts and high-margin repeatables
- Software & telematics – Often a first step into EaaS models
B2C
- Mobility – E-bikes, scooters, even cars (Tesla subscriptions)
- Kids & baby gear – Grows with the child, not the parent’s wallet
- Consumer electronics – Always-on-upgrade paths
- Seasonal gear & furniture – Pay for use, not storage
3. Who's doing it well - and what can we learn?
Here’s a snapshot of real examples discussed in the interview:
- Hilti – Tools-as-a-Service model reduced maintenance hassle for customers and locked in recurring revenue.
- Swapfiets – Subscriptions focused on "a bike that always works," removing all friction from ownership.
- Loopz Bikes – Built on P2S + Circuly, optimized from day one to achieve 2.5x profit over traditional sales.
- Philips – Pivoted to Lighting-as-a-Service, standing out in a saturated LED market.
- Care & Energy Partners – Sold temperature outcomes, not devices - redefining value.
- A baby goods company – Turned returned products into a profitable open-box subscription model.
Each example offers a different lesson - whether it’s about infrastructure, positioning, or partner collaboration.
📖 For the detailed breakdown: Read the full article
Teasers: What the full article covers next
4. How does moving from CapEx to OpEx impact financial health?
(Think “fish model” - initial dip, long-term gain.)
5. What product characteristics make a good subscription candidate?
(Durability, price point, upgrade cycle, second-hand value...)
6. How do you know if your customer base is ready?
(There are specific signals to look for - beyond surveys.)
7. What are early warning signs that a company might struggle?
(Misalignment, resistance, lack of infrastructure...)
8. What are the building blocks of a successful PaaS model?
(A three-phase approach - from pilot to scale.)
9. What tech stack and infrastructure do you need?
(Spoiler: Excel won’t cut it.)
10. What role do partners play in PaaS success?
(It’s not just about software - it’s about ecosystems.)
11. What’s next for the subscription economy?
(More regulation, more connected hardware, more use-over-ownership.)
👉 Read the full article written by Circuly:
Top 11 Questions About Product-as-a-Service (PaaS)
Or get in touch with P2S if you want to explore what this shift could mean for your business.