2026 data · Sample size: 151 · Source: CB Insights State of Venture 2025
25th %ile
45.4%
Median
66.1%
75th %ile
92.2%
90th %ile
97%
▬Trending stable year-over-year
About This Metric
Revenue minus cost of goods sold, expressed as a percentage. For SaaS, this is typically 70-85%.
(Revenue - COGS) / Revenue × 100
Higher is better · Unit: percentage
How to Improve
Reduce hosting and infrastructure costs through architecture optimization and vendor negotiation. Automate support and onboarding to reduce per‑customer service costs. Shift from managed services to self‑serve to lower cost of delivery. Renegotiate third‑party data and API costs as you scale. Increase pricing to reflect the value delivered without proportionally increasing COGS.
Ehsan's Analysis
HealthTech gross margins are compressed by two costs other software companies do not face: clinical validation and regulatory compliance. A pure SaaS company spends $0 on validating that its product produces correct outputs. A healthtech company processing medical images or making clinical recommendations must continuously validate accuracy, maintain FDA clearances, and carry professional liability insurance. These costs sit in COGS, not OpEx, reducing gross margins to 55-65% versus 75-85% for standard SaaS. The healthtech companies with 70%+ gross margins (Veeva, Doximity) sell information and workflow tools, not clinical decision support. The margin lesson: if your healthtech product's output influences clinical decisions, budget 15-20% of revenue for ongoing validation and compliance. If your product is a workflow tool that happens to serve healthcare (scheduling, billing, communication), you can achieve standard SaaS margins.
EJ
Ehsan Jahandarpour
AI Growth Strategist & Fractional CMO
Forbes Top 20 Growth Hacker · TEDx Speaker · 716 Academic Citations · Ex-Microsoft · CMO at FirstWave (ASX:FCT) · Forbes Communications Council
Frequently Asked Questions
What is a good Gross Margin for HealthTech companies at Series B stage?
The median Gross Margin for HealthTech companies at the Series B stage is 66.1%. Top‑quartile companies (75th percentile) significantly outperform this baseline. The most important factor is consistent improvement over time rather than hitting any single target number.
How does Gross Margin differ by company stage in HealthTech?
Gross Margin typically improves as HealthTech companies mature from seed through growth stage. Earlier‑stage companies should benchmark against stage‑appropriate peers rather than comparing themselves to mature companies.
How often should HealthTech companies measure Gross Margin?
HealthTech companies at the Series B stage should track Gross Margin monthly with quarterly deep‑dive analysis. Set up automated dashboards and alerts for significant deviations from your baseline.
What factors most impact Gross Margin in the HealthTech sector?
In HealthTech, the primary factors impacting Gross Margin include product‑market fit maturity, competitive landscape intensity, customer segmentation strategy, pricing optimization, and operational efficiency. Series B‑stage companies should focus on the one or two highest‑leverage factors rather than trying to optimize everything simultaneously.
How does Gross Margin for HealthTech compare to cross‑industry benchmarks?
HealthTech Gross Margin benchmarks can differ significantly from cross‑industry averages due to factors specific to the HealthTech vertical including customer acquisition dynamics, competitive intensity, and typical deal sizes. Always compare against industry‑specific benchmarks rather than broad averages for meaningful insights.