A healthtech startup’s first customer segment needs two things at once: people who will use the product and someone with the budget to pay for it. Knowing how to find the target customer segment for a healthcare startup starts there. Clinician enthusiasm is necessary, but it is not sufficient, and the best first segment is the one where the fewest people stand between use and budget.

Consider an illustrative case. A startup sells an AI documentation tool that helps physicians capture every diagnosis they discuss, so the care they deliver gets billed. Three physicians in a hospital-owned primary care group try it for 90 days and rate it highly. Then the deal stops moving. The health system’s product review committee wants outcome data, IT security sends a long questionnaire, and finance asks what the tool returns within 18 months.

Nothing went wrong with the product. The pilot proved that physicians would use it. It never tested whether anyone with a budget would buy it, or how many people stood between the two.

This article is for founders of seed-stage US healthtech companies who have a problem statement and physician champions, and are about to decide which buyers to sell to first. It is the third piece in A|P’s series on the foundation of product-market fit, which sets out the method; this article works through it.

Why is clinician enthusiasm necessary but not sufficient?

Clinician enthusiasm is necessary because a product nobody uses won’t renew, and it is not sufficient because the clinician who uses a product is less and less often the person who pays for it. A segment works only when it contains both: an end user who adopts and a decision maker who funds.

The gap between the two has widened. In 2024, 42.2% of US physicians worked in practices wholly owned by physicians, down from 60.1% in 2012, and 34.5% worked in hospital-owned practices. An employed physician can recommend a product. Someone else usually signs.

Hospitals have also formalized who signs. Most run a value analysis committee, a cross-functional group that reviews new products before anyone can buy them; one academic system describes multidisciplinary teams that review requests, trials and adoption decisions. At a 2026 industry meeting, speakers described the effect plainly: a respected surgeon can open doors, but approval now needs finance, supply chain, nursing, operations and clinical leadership.

So the question for a founder is not whether clinicians like the product. It is who else has to say yes, and whether the segment you choose keeps that list short.

Who are the healthcare decision makers in each US setting, and how do you reach them?

A healthcare purchase usually involves six roles: an economic buyer, a champion, a technical buyer, an operational buyer, a manager and the end users. In a small physician-owned practice, one or two people fill all six. In a health system, each role belongs to a different person or committee. Knowing how to reach healthcare decision makers starts with knowing which person holds which role.

The six roles, in US healthcare terms:

1. Economic buyer: approves the spend and judges the return. A practice owner, a CFO or a finance lead.
2. Champion: argues for the product inside the organization. Often a physician, a nurse leader or a chief medical information officer.
3. Technical buyer: checks security, integration with the electronic health record (EHR) and compliance. A CIO, a security officer or the EHR team. This role can block a deal on its own.
4. Operational buyer: asks how the product changes workflows, staffing and billing. A COO, a practice administrator or a revenue cycle director.
5. Manager: leads the team that will use the product. A medical director, a department chair or a clinic manager.
6. End users: work with the product every day. Physicians, nurses, medical assistants and coders.

The table shows how differently those roles are filled across five US settings.

Setting	Economic buyer	Champion	Technical buyer	Operational buyer	Manager	End users	Separate people, roughly
Small physician-owned practice	Owner physician	Owner physician	Outsourced IT or the EHR vendor	Practice manager	Owner physician	Physicians, medical assistants	2–3
Independent group, 10–50 physicians	Managing partners or a CFO	A partner physician	IT lead	Practice administrator	Medical director	Physicians, staff	3–5
Hospital-owned practice	Health system finance	Employed physician	System IT and security	Practice operations director	Medical director	Physicians, staff	6 or more, plus a committee
Health system	CFO	Chief medical information officer	CIO and security officer	COO or revenue cycle leader	Service line chief	Clinicians across sites	6 or more, plus committees
Health plan or employer	Finance or benefits leader	Medical director or benefits manager	IT, security and privacy	Care management or benefits operations	Program lead	Care managers or members	5 or more

Reaching them follows from the table. In a small practice, one conversation can reach the economic buyer, the champion and an end user at once. In a health system, a founder needs a champion who will carry the case to people the founder may never meet, and material written for each of them: the return for finance, the security file for IT, the workflow plan for operations. How to build that motion is covered on A|P’s page on go-to-market strategy for healthtech ventures.

Every one of those people sets a hurdle. In a 2022 survey of 100 hospital executives, more than half said finalizing a contract for a new solution takes more than three months, and 35% said more than six. Any product that handles patient data also needs a business associate agreement under HIPAA before it gets access.

How do you prioritize target customer segments for a healthcare startup? A worked scoring

Prioritize segments by scoring each one on the five traits that make a good first segment, then add one more measure: how many separate people stand between use and budget. The segment with strong scores and a short distance between user and buyer goes first. The rest wait, in order.

The guide on PMF foundations names the five traits: the most acute problem, the strongest response to the value proposition, the clearest advantage over alternatives, the easiest reach and the strongest willingness to pay. Here they are applied to four candidate segments for the documentation tool above. The scores are A|P’s illustrative judgment on a scale of one to three, not survey data. A founder would replace them with what buyer conversations show.

Trait	Small physician-owned specialty groups	Independent groups, 10–50 physicians	Hospital-owned primary care	Federally qualified health centers
Acute problem	2	3	3	3
Response to the value proposition	3	3	2	1
Advantage over alternatives	3	2	1	2
Ease of reach	2	2	1	2
Willingness to pay	2	3	3	1
Total (out of 15)	12	13	10	9
People between use and budget	2–3	3–5	6 or more	4 or more

Independent groups of 10 to 50 physicians score highest. The problem is acute because more documented care means more revenue, the partners who feel it also control the budget, and the people between use and budget are few enough to reach in a few meetings.

Small physician-owned groups come a close second, and suit a later wave. The economic buyer and the end user are often the same person, so deals close fast. The catch is reach: there are many small practices, each buying in small amounts. Specialty mix matters too: in 2024, 70.4% of ophthalmologists worked in private practice, against 30.7% of cardiologists.

Hospital-owned primary care has the budget but scores lowest on advantage and reach. Most health systems already run documentation AI: in the Peterson Health Technology Institute’s 2026 survey, 71% of health systems reported active deployments of clinical documentation and ambient scribing. And when Epic launched its own ambient tool, most of the Epic customers KLAS interviewed expected to adopt it within two years.

Federally qualified health centers, community clinics that receive federal grants, feel the problem but respond weakly to this value proposition. Medicaid pays them a fixed rate per visit under a prospective payment system, so documenting more diagnoses in a visit often does not raise what the visit pays. A different value proposition, such as staff time saved, might score them higher.

Why do competitors ignore a segment, and should you go there?

Competitors usually ignore a segment for one of three reasons: it can’t pay, it can’t be reached at a reasonable cost, or its customers won’t stay. Only a segment that is ignored for some other reason, such as being too small for large vendors to notice, is an opportunity. Test all three reasons before committing.

1. It can’t pay. Check how the segment earns its money and whether your value proposition moves that number. For federally qualified health centers selling on billed diagnoses, it often doesn’t.
2. It can’t be reached. Count the buyers and the channels that reach them: specialty societies, regional associations, EHR marketplaces, billing companies. If each sale needs a cold introduction, the cost of acquiring customers will outrun what they pay.
3. It won’t stay. Ask whether the customers will still exist, and still decide for themselves, in two years. Independent practices are being acquired: the share of physicians in physician-owned practices fell from 60.1% to 42.2% in twelve years. A customer that joins a health system takes its purchasing with it.

For independent groups, the third test is the sharpest. A founder should ask, in every sales conversation, whether the group plans to sell or affiliate, and should price contracts so that losing a customer to acquisition doesn’t erase the year.

How do you know you picked the right segment?

You know the segment is right when the economic buyer, not only the end user, gives you evidence: contracts signed at a price that covers your costs, a sales cycle that fits your runway, and a second customer who came by referral. Enthusiastic users in a segment that won’t sign are evidence for the product, not the segment.

Set those three tests before the first sales conversation, with numbers attached. If the first three deals in a segment each take longer than your runway allows, the segment is wrong for now, however well the pilots went. Hospital finance teams have set a high bar: in a vendor-commissioned 2026 survey of 150 US hospital CFOs, 51% required a return above 110% within 18 months.

The limits of the argument

A segment can be easy to sell to and still too small to fund the company. Sometimes an enterprise customer first is the right call, for credibility, for data or for a distribution partner, even if it takes a year. And the scoring is a judgment, not arithmetic: it organizes the argument, and buyer conversations should change the numbers.

The argument also assumes the user and the buyer can be found apart. In some products, such as tools sold directly to patients, they are the same person, and the question becomes how many of them will pay.

The decision in front of you is whether your first segment was chosen because the users love the product, or because the people who use it and the people who pay for it are close enough to say yes together.

Part of A|P’s series on the foundation of product-market fit. Earlier in the series: Societal need isn’t a market, and Solution looking for a problem.

Frequently asked questions

How do you find the target customer segment for a healthcare startup?

To find the target customer segment for a healthcare startup, list the attributes that define your buyers, combine them into candidate segments, and score each on five traits: problem acuity, response to your value proposition, advantage over alternatives, ease of reach and willingness to pay. Then count the people between use and budget, and start where that number is smallest.

Healthcare decision maker vs end user: what is the difference?

A healthcare decision maker approves the purchase and is accountable for its cost and return; an end user works with the product every day. In a small physician-owned practice they are often the same physician. In a hospital-owned practice or health system, they are usually different people, and the decision often runs through a committee.

How do you reach healthcare decision makers?

You reach healthcare decision makers through the champion who uses your product and through material written for each role that has to approve it: the return for finance, the security file for IT and the workflow plan for operations. In small practices one conversation can reach them all; in health systems the champion carries the case.

Should a healthtech startup sell to physicians or hospitals first?

Most healthtech startups should sell first where the physician is also the buyer or close to the buyer, such as an independent physician-owned group, because the sales cycle is short. Selling to a hospital or health system first makes sense when the product needs its data, scale or credibility, and the company has the runway for a long sale.