Health Informatics Consulting Break-Even: Month 19 Target

Fixed costs $12.2K Monthly overhead base

Contribution margin 75% After variable costs

Break-even revenue $61.8K Monthly target

Break-even timing Month 19 First breakeven

Break-even calculator

Test monthly revenue, variable expenses, and fixed costs against break-even for a health informatics consulting practice.

Lean Base Full

Monthly revenue Revenue has to cover direct costs first, then the monthly cost base. $ Low revenue High revenue Variable expenses Use costs that rise with client work, like travel, tools, or subcontractors. $ Low costs High costs

Money available to cover fixed costs $102,000 $120,000 revenue - $18,000 variable expenses

Margin ratio

85%

Covers fixed costs

Yes

Fixed monthly costs Use rent, software, insurance, and payroll that stay on each month. $ Low fixed High fixed

Break-even chart Revenue Total costs

Which expenses are fixed and which move with sales in a health informatics consulting firm?

Cost classification

Break-even is only reliable when revenue-linked items reduce contribution margin and stable monthly bills stay in overhead. Here, Month 19 break-even depends on separating the 25% first-year variable load from fixed bills and hiring steps.

Expense	Cost	Break-Even Treatment	Common Mistake
Office rent	Fixed	Use $6,500 per month in the overhead base from Month 1 through Month 60.	Spreading rent across projects as if it rises with each client.
General software subscriptions for client and project management	Fixed	Use $1,200 per month in fixed overhead for the relevant planning range.	Treating base software as a project delivery expense.
Project-specific software licenses	Variable	Deduct 7.0% of first-year revenue before calculating contribution margin.	Treating project software as overhead instead of revenue-linked expense.
External data validation services	Variable	Deduct 4.0% of first-year revenue because usage tracks client project volume.	Leaving validation out of margin and overstating break-even progress.
Consultant travel and client expenses	Variable	Deduct 8.0% of first-year revenue as work increases with client delivery.	Budgeting travel as flat, even when more projects need onsite work.
Professional development and certifications	Variable	Deduct 6.0% of first-year revenue when modeling delivery capacity tied to client work.	Ignoring certification spend needed to support billable service growth.
Salaried delivery and sales staffing	Semi-variable	Keep current salaries in overhead, then add planned full-time equivalent increases by year.	Treating all payroll as purely variable with revenue.
Cybersecurity and compliance capacity	Semi-fixed	Use the $1,000 monthly base, then model larger capacity only when client volume steps up.	Assuming security capacity scales smoothly instead of in operating steps.

How does break-even shift from a lean launch team to a full consulting bench?

Scenario table

The math changes as staffing and billable output change. In the lean case, revenue has to cover a heavy fixed load first; by the base case, break-even is nearly reached; in the full-team case, EBITDA turns positive and the cushion starts to build.

These are planning assumptions, not guarantees; client wins, utilization, and project mix can move break-even up or down.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch team	$671k	$168k	$526k	75%	$-23k	Still below break-even, so fixed overhead is the first hurdle.
Base month-19 case	$701k	$175k	$526k	75%	$-1k	Almost flat, with very little cushion if utilization slips.
Full-team Year 3 case	$809k	$202k	$526k	75%	$81k	Break-even is behind you, and the profit cushion starts to widen.

What breaks this break-even plan if billings slow or costs rise?

Stress test

This plan needs about $702,000 in annual revenue at a 75% contribution margin to cover fixed overhead. Slow onboarding, higher hiring or software spend, or a 2-point margin slip can turn a small miss into a six-figure gap.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$702,000	$0 gap	Break-even is tight, so any slip matters.
Revenue shortfall	Annual billings finish $10,000 below plan.	$702,000	$10,000 gap	Slow onboarding or delayed deals can push the model off balance.
Fixed-cost increase	Annual fixed overhead rises by $50,000.	$768,000	$66,667 gap	Unfunded hiring or higher software spend resets the target fast.
Margin pressure	Variable spend rises 2 points, cutting contribution margin to 73%.	$720,548	$19,215 gap	Travel, outside validation, or discounting erode room quickly.
Combined pressure	Billings fall $10,000, margin drops 2 points, and fixed overhead rises $90,000.	$843,836	$142,503 gap	Three hits at once create a funding gap, not a small trim.

Can you prove enough health data consulting demand before you add the next hire and fixed spend?

Founder checklist

Don’t add the next hire or lock in more overhead until signed and near-signed work can cover the model’s monthly break-even load. Here, the test is simple: revenue, staffing, and cash all have to line up before you spend ahead of demand.

1Booked Pipeline$61.9K/mo

Confirm signed or near-signed work can reach the monthly break-even load before you commit to more payroll or office spend.

2Fixed Burn$46.4K/mo

Your fixed load is about $46.4K a month before variable costs, so any slip in bookings shows up fast.

3Margin Mix75% CM

Year 1 contribution margin is about 75% after software, validation, travel, and development costs, so keep delivery expense creep in check.

4Team Capacity135 hrs

The first-year service mix totals 135 billable hours, so make sure the core team can deliver it without overtime drag.

5Cash Floor$427K

Minimum cash lands at $427K in Month 19, so protect runway before you take on more fixed commitments.

6CAC Discipline$7.5K CAC

Year 1 CAC is $7.5K against a $75K marketing budget, so the funnel has to close qualified leads, not broad traffic.