European HealthTech valuation multiples - September 2025

The European HealthTech market in September 2025 is characterized by a "cautious yet discernible rebound" and a strong focus on profitability and proven business models. While overall deal volume has seen a slight decline, the average deal size and total deal value have increased significantly, indicating a market preference for larger, more impactful transactions.

Key drivers of valuations include:

Artificial Intelligence (AI): AI is the single biggest driver of valuation premiums, particularly for companies with proprietary AI algorithms, clinically validated solutions, and deep integration into existing healthcare workflows.

Value-Based Care: Companies that enable the shift from a fee-for-service to a value-based care model, by providing solutions that deliver measurable cost savings and improved patient outcomes, are highly sought after.

Data Monetisation and Interoperability: Firms that can ethically and effectively leverage patient data and offer solutions that integrate with Electronic Health Records (EHRs) are commanding higher multiples.

Recurring Revenue: Companies with a high percentage of recurring revenue, a strong growth trajectory, and high gross margins are awarded higher multiples.

Regulatory Clarity: The implementation of the EU AI Act and the European Health Data Space (EHDS) is providing a clearer regulatory framework, which is boosting investor confidence.

Valuation Multiples by Metric

1. Revenue Multiples (Enterprise Value / Revenue)

General HealthTech: The average revenue multiple for most HealthTech companies is in the range of 4x to 6x. 

Premium Segment (AI, Telehealth, Analytics): Companies with proprietary AI-driven solutions, scalable telehealth platforms, or advanced analytics are commanding premium valuations, typically ranging from 6x to 8xrevenue or more.

Data-Driven Companies: Firms that specialize in leveraging clean, actionable data for analytics or interoperability can command multiples of 5.5x to 7x.

Value-Based Care Solutions: Companies aligned with this model, such as chronic disease platforms and remote monitoring solutions, are seeing multiples climb to 5.5x to 7x.

Smaller/Unprofitable Startups: These firms may face valuation compression, with multiples in the 3x to 4x range, unless they are acquired by strategic buyers seeking innovation at a discount.

2. EBITDA Multiples (Enterprise Value / EBITDA)

For Profitable HealthTech Companies: The general range for EV/EBITDA multiples is between 10x to 14x, a slight increase from the 10x to 12.5x range observed in 2024. This reflects a growing focus on profitability and cautious optimism in the market for established entities.

Public Companies (Broader Health Services): Multiples in this sector have shown stability, with the average rising slightly from 13.5x at the end of 2023 to 14.0x by late 2024.

3. Other Notable Trends

Investment Concentration: Capital is being deployed in a more concentrated and deliberate manner, with a shift towards growth and late-stage investing. The average deal size has increased significantly.

M&A Activity: While global M&A activity in the broader health industries has slowed, the European healthcare sector has experienced a substantial increase in deal value, indicating a focus on larger transactions. Venture-to-venture transactions are also becoming a dominant trend.

IPO Market: The market for Initial Public Offerings (IPOs) remains stagnant, leading M&A to become the primary exit path for many companies.

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