Online Therapy Running Costs: $786K Monthly Overhead

Online Therapy Running Costs

Running an Online Therapy platform requires significant fixed and variable overhead, even before factoring in therapist compensation Expect core platform operating costs to start around $78,600 per month in 2026, driven primarily by executive salaries and digital marketing spend This figure covers $28,333 in essential wages (CEO and CTO) and $16,500 in fixed software and compliance fees Your biggest variable lever is digital advertising, which starts at 70% of revenue, totaling about $19,200 monthly based on $274,300 in projected gross revenue To maintain positive cash flow, you defintely need a minimum cash buffer of $841,000, which was required in January 2026 to cover initial capital expenditures and operating losses until the platform reaches its breakeven point in Month 1 We break down the seven critical running costs that determine your platform's sustainability

7 Operational Expenses to Run Online Therapy

#	Operating Expense	Expense Category	Description	Min Monthly Amount	Max Monthly Amount
1	Executive Wages	Fixed	Core wages total $28,333 monthly, covering the CEO ($15,000) and CTO ($13,333) salaries.	$28,333	$28,333
2	Software Licenses	Fixed	This fixed cost is $5,000 per month and covers the essential technology stack required to run the service.	$5,000	$5,000
3	Digital Ads	Variable	Starting at 70% of gross revenue, this variable cost is projected at ~$19,201 monthly based on 2026 revenue.	$19,201	$19,201
4	Cybersecurity	Fixed	A non-negotiable fixed cost of $3,500 per month ensures the platform meets strict HIPAA and data security standards.	$3,500	$3,500
5	Data Hosting	Variable	This variable expense starts at 30% of revenue, costing ~$8,229 monthly to support growing user and therapist data loads.	$8,229	$8,229
6	Payment Fees	COGS	As a direct cost of service, these fees start at 15% of revenue, equaling ~$4,115 monthly in 2026.	$4,115	$4,115
7	Legal Services	Fixed	A retainer covers ongoing legal and regulartory oversight needed for compliance, costing $2,000 monthly.	$2,000	$2,000
Total		All Operating Expenses		$70,378	$70,378

What is the total monthly running budget needed to operate the Online Therapy platform sustainably?

To run the Online Therapy platform sustainably, you need a minimum monthly budget covering therapist payouts, tech costs, and core staff, totaling roughly $105,000 before client acquisition; this calculation helps frame profitability questions, much like understanding how much the owner of an online therapy business typically makes. Defintely focus on controlling the therapist payout rate first.

Variable Costs & Therapist Payouts

Therapist compensation is your primary Cost of Goods Sold (COGS).
We estimate therapist payouts consume 65% of gross session revenue.
Payment processing fees add another variable drag, estimated at 3% per transaction.
Total variable expenses sit near 68% of monthly intake before fixed costs hit.

Fixed Overhead & Admin Burn

Fixed overhead includes platform hosting and essential software licenses.
Administrative payroll for non-clinical support is budgeted at $25,000 monthly.
Fixed overhead (excluding payroll) runs about $12,000 monthly for infrastructure.
The combined fixed burn rate is $37,000, which you must cover before profit.

Which recurring cost categories represent the largest percentage of the platform's operating expenses?

The primary recurring expense for the Online Therapy platform is variable advertising, consuming 70% of revenue, making it the dominant cost driver compared to fixed overheads like executive payroll and software. Before diving into cost structure, Have You Considered The Key Sections To Include In Your Business Plan For Online Therapy? because understanding revenue drivers is crucial when 70% of that revenue is immediately consumed by customer acquisition costs. This structure suggests that controlling the Customer Acquisition Cost (CAC) is more critical than managing the $283k monthly executive salaries. I see a defintely high risk here if conversion rates drop.

Fixed Overhead Snapshot

Executive salaries set a high fixed floor at $283,000 monthly.
Fixed software licenses add a small but necessary $5,000 overhead.
Total monthly fixed burn rate is $288,000 before accounting for advertising.
This fixed cost requires significant revenue volume just to cover payroll and tech stack.

The Variable Cost Lever

Advertising spend is highly variable, pegged at 70% of total platform revenue.
This means for every dollar earned, 70 cents goes straight back into marketing.
If revenue drops, this cost scales down instantly, unlike salaries.
The key operational lever is lowering the 70% acquisition cost metric.

How much working capital or cash buffer is required to cover costs before reaching consistent profitability?

You need a minimum cash buffer of $841,000 to cover initial operating costs before the Online Therapy business hits consistent profitability, which is why understanding the path forward is critical; read more about this specific challenge in Is Online Therapy Business Profitable? This buffer buys you about 10.7 months of runway based on projected initial monthly spend.

Cash Requirement Breakdown

The required cash buffer is set at $841,000.
This amount must cover fixed overhead until break-even.
Initial monthly operating costs sit at $78,600.
This figure assumes no major unexpected tech overruns.

Calculating Runway

Runway is calculated by dividing the cash buffer by monthly burn.
$841,000 divided by $78,600 yields 10.7 months.
If onboarding takes longer than 10 months, churn risk rises defintely.
Your immediate goal is hitting utilization targets within seven months.

How will the business cover running costs if monthly revenue targets are missed by 20% or more?

If Online Therapy misses revenue by 20% or more, immediate cost control centers on slashing the variable marketing budget, which currently consumes about 70% of revenue, and pushing back planned hiring; you should defintely review Have You Considered The Key Sections To Include In Your Business Plan For Online Therapy? to ensure your underlying assumptions are sound before reacting too quickly.

Variable Spend Reduction

Cut paid acquisition immediately.
Assess Cost Per Acquisition (CPA).
Shift budget from low-ROI channels.
Monitor daily spend vs. revenue flow.

Personnel Timing Adjustments

Delay hiring non-essential roles.
Review all pending 2027 headcount.
Keep core therapist support staffed.
Evaluate contractor vs. employee mix.

Key Takeaways

The core monthly operating cost for the online therapy platform, excluding therapist compensation, is projected to start around $78,600 in 2026.
Executive payroll and variable digital advertising spend, which constitutes 70% of projected revenue, are the two largest components driving initial monthly overhead.
Essential fixed overhead, covering platform software licenses, cybersecurity, and legal retainers, totals $16,500 per month.
A minimum working capital buffer of $841,000 is required at launch to cover initial capital expenditures and operational losses until the projected breakeven point in Month 1.

Running Cost 1 : Executive and Administrative Wages

Executive Wages 2026

Core executive wages for 2026 are set at $28,333 per month, split between the CEO ($15,000) and the CTO ($13,333). This fixed overhead is crucial for platform governance and technical roadmap execution; it's a baseline expense you must cover every month.

Inputs for Fixed Pay

These executive salaries represent a fixed cost essential for leadership and technology oversight. The $28,333 figure is based on negotiated 2026 compensation packages for the two key roles. This amount is independent of patient volume, meaning it must be paid even if sessions are low.

CEO salary input: $15,000/month
CTO salary input: $13,333/month
Total fixed wage: $28,333/month

Managing Founder Pay

Managing these fixed wages requires discipline before scaling variable costs like advertising. If the platform hits revenue targets early, resist the urge to immediately raise these salaries above the planned 2026 amount of $28,333. A common mistake is letting founder compensation increase before unit economics are proven robust.

Anchor pay to milestones, not projections.
Keep cash compensation low initially.
Use equity for upside sharing.

Overhead Comparison

Compare this $28,333 fixed wage against other operating costs to gauge its impact on break-even. This executive cost is roughly 3.4 times higher than the estimated $8,229 monthly spend for platform data hosting and scaling. Ensure the CTO’s output justifies this significant investment relative to variable technology expenses.

Running Cost 2 : Platform Core Software Licenses

Core Tech Spend

Your essential technology stack costs a fixed $5,000 per month to operate the online therapy service. This covers the foundational software licenses required for secure video, data handling, and scheduling functions.

License Inputs

This $5,000 monthly expense covers critical licenses for the technology stack, like secure database access and video APIs. It’s a fixed cost that doesn’t change with patient volume, so you need vendor quotes to lock this baseline in. It must be budgeted before the first session.

Covers core platform software.
Fixed at $5,000/month.
Essential for service delivery.

Managing Licenses

You can’t easily cut this spend without halting operations, but review usage annually for waste. Look for bundled pricing if you add new features, like advanced compliance auditing tools. Avoid paying for premium tiers you defintely don't need right now.

Review vendor contracts yearly.
Avoid paying for unused capacity.
Negotiate volume discounts early.

Fixed Cost Leverage

Since this is fixed, it heavily impacts your margin when transaction volume is low. If revenue is $50,000, this $5,000 is 10% of revenue, but if revenue hits $200,000, it drops to 2.5%. Growth dilutes this overhead fast.

Running Cost 3 : Digital Advertising Spend

Ad Spend Reality

Digital advertising is your biggest variable expense, consuming 70% of gross revenue. Based on 2026 projections, this means spending about $19,201 monthly just to acquire clients for your online therapy platform. This high percentage demands immediate scrutiny of your Customer Acquisition Cost (CAC).

Cost Drivers

This spend covers marketing channels used to attract US adults aged 25-55 seeking virtual counseling. To calculate this, you multiply projected 2026 revenue by the 70% rate. Since this cost scales directly with revenue, growth means this expense scales linearly. What this estimate hides is the actual cost per booked session.

Input: 2026 Gross Revenue
Metric: 70% variable rate
Result: ~$19,201 monthly spend

Cutting Ad Waste

A 70% ad spend is defintely not sustainable long-term; you must drive down the Customer Acquisition Cost (CAC). Focus on improving conversion rates from click to booked session, not just traffic volume. If your Cost Per Acquisition (CPA) is too high, you'll never cover fixed overhead like executive wages.

Benchmark CAC against Lifetime Value (LTV).
Test smaller, high-intent ad groups first.
Optimize landing pages for immediate booking.

Variable Risk Profile

Because advertising is 70% of revenue, any dip in client volume immediately crushes your gross margin. This high dependency means your platform needs robust organic channels or strong therapist retention to buffer against ad market volatility. It’s a major lever, but a risky one right now.

Running Cost 4 : Cybersecurity and Compliance

Mandatory Security Spend

Meeting strict data security requirements for patient records means the platform must budget for a fixed monthly cost of $3,500. This expense is non-negotiable for handling sensitive health information under standards like HIPAA. This baseline security spend protects against severe regulatory fines.

Cost Inputs and Budget Fit

This $3,500 monthly spend covers necessary infrastructure and audits to maintain compliance, especially for handling Protected Health Information (PHI). Since this is a fixed cost, it must be covered regardless of session volume. It sits alongside other fixed overhead like executive wages ($28,333) and software licenses ($5,000).

Covers HIPAA audit readiness.
Funds necessary encryption layers.
Secures third-party compliance monitoring.

Managing Compliance Overhead

You can't cut security, but you can optimize procurement. Avoid paying premium rates for general security tools; focus spending only on HIPAA-specific certifications. Scaling hosting (30% variable cost) must be monitored closely, as poor security practices can lead to costly breach remediation later. We defintely need to track this.

Audit vendor quotes annually.
Bundle compliance services if possible.
Never skimp on breach response planning.

Insurance vs. Expense

Consider this $3,500 fixed cost as operational insurance, not optional software. If you skip this, the potential cost of a data breach—including fines and lost customer trust—will dwarf this monthly budget item instantly.

Running Cost 5 : Platform Data Hosting & Scaling

Hosting Hits 30%

Data hosting is a major variable expense tied directly to platform use. This cost begins at 30% of revenue, hitting about $8,229 monthly based on 2026 projections. You must track data volume against revenue to manage this spend effectively. This cost scales with every new client session booked.

Data Cost Drivers

This hosting cost covers storing sensitive client records and therapist profiles, plus supporting video session bandwidth. The input is 30% of gross revenue. If revenue hits $27,430 (calculated as $8,229 / 0.30), this expense equals $8,229. You need clear metrics linking data usage tiers to your pricing structure.

Taming Data Sprawl

You can manage this variable spend by optimizing data retention policies and choosing the right cloud provider tier. Avoid over-provisioning storage for defintely inactive user data. Negotiate volume discounts with your Infrastructure as a Service (IaaS) vendor once you pass the initial growth phase.

Audit storage needs quarterly.
Archive old session transcripts.
Ensure serverless architecture is used.

Variable Cost Link

Since hosting is 30% of revenue, scaling responsibly means ensuring your Average Revenue Per User (ARPU) grows faster than your data storage needs. If therapist onboarding spikes but client utilization lags, this cost eats margin quickly. Monitor this ratio closely.

Running Cost 6 : Payment Processing Fees

Fee Impact

Payment processing fees are a direct cost of service that hits your gross margin immediately. For 2026 projections, expect these fees to consume 15% of all revenue, amounting to roughly $4,115 every month. This cost is unavoidable when accepting digital payments for therapy sessions.

COGS Component

These fees cover the interchange rates and processor markup for every client transaction. You calculate this by taking total monthly revenue and multiplying it by the 15% rate. Since this is Cost of Goods Sold (COGS), it directly reduces your gross profit before overhead like salaries or hosting kicks in.

Revenue input is essential for estimation.
Fixed salaries do not affect this cost.
It reduces gross profit dollar-for-dollar.

Fee Reduction Tactics

You can negotiate better tiers once volume scales past $50,000 monthly, but initial rates are often fixed. Avoid high interchange costs by steering clients toward ACH payments where possible, though clients defintely prefer credit cards. If onboarding takes 14+ days, churn risk rises, making payment friction a bigger issue.

Seek volume discounts early.
Monitor processor statements closely.
Avoid expensive instant payout options.

Margin Pressure Check

If your average session price is low, this 15% fee eats up too much margin. You need high utilization to offset this, or you’ll need to raise prices to maintain a healthy gross margin above 50%. This cost scales perfectly with revenue, so watch your take-rate closely.

Running Cost 7 : Legal and Regulatory Services

Compliance Cost Anchor

Compliance in online therapy demands a fixed monthly budget for oversight. You must budget $2,000 per month for the ongoing legal retainer necessary to navigate HIPAA and state licensing requirements for your platform. This cost is non-negotiable for operation.

Legal Cost Details

This $2,000 fixed retainer covers continuous legal review for data privacy and practitioner credentialing, which is critical for your service. This cost is budgeted monthly against your total fixed overhead, alongside the $28,333 in wages and $5,000 for software licenses. Here’s the quick math: this regulatory cost is about 2.5% of your total initial fixed costs ($2,000 / ($28,333 + $5,000 + $3,500)).

Covers ongoing HIPAA and state law monitoring.
Fixed cost, independent of patient volume.
Budgeted monthly against core overhead.

Managing Legal Scope

You can’t cut compliance, but you can manage the scope of work. Ensure your retainer agreement clearly defines response times and limits billable hours outside the agreed scope. Avoid using the retainer for routine HR tasks; that’s a separate administrative cost. Many founders overpay by not defining boundaries upfront.

Define retainer scope strictly upfront.
Avoid using legal for HR tasks.
Review provider quarterly for scope creep.

Scaling Risk Check

If you scale rapidly across new states, this $2,000 retainer may not cover multi-jurisdictional licensing reviews. That gap means you might need a variable legal budget for state-specific compliance audits, which is a defintely hidden risk if you expand too fast.