🥣 8.1.2025 AI diagnoses, tech outsourcing, gravy, healthcare innovation cycles
What holds us back more often than anything else is lack of curiosity.
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⏱️ 30 seconds to set you up for a better week:
Welcome to S3T! It's time to take a few minutes to set yourself up for success. Give yourself ways to win this week:
- Know the top Economic drivers impacting your customers
- Know the top Technology insights and issues your team needs to deal with
- Get ahead of the curve on key industry shifts.
Start your stopwatch here we go:
🔄 Innovation Reset in Healthcare
The U.S. is entering a new health innovation cycle — moving beyond apps and wearables toward unified data systems and financial innovation. The White House and CMS are calling for a "patient-centric ecosystem", but the jury's out on whether this is real change or just another gravy train.
💸 Fewer, Bigger Bets in Digital Health
VCs are regrouping after a down cycle in digital health startups. Funding is down, but deal sizes are up, with AI and late-stage plays commanding attention. The message: no more funding-for-the-sake-of-it. Show ROI or get stuck in exit limbo.
📉 Growth Up, Confidence Lukewarm
GDP is up 3%, but business investment is down and consumer confidence is still trailing 2024 levels. Inflation lingers, and cost pressures will persist — especially in sectors facing supply chain strain or global friction.
🇮🇳 India's Role in a Multipolar Economy
India is now ahead of China in iPhone exports to the U.S. and may soon dominate Apple’s supply chain. But with U.S.-India trade talks stalling, execs with exposure to Indian partners should watch for tariff shocks — and for ripple effects in tech outsourcing.
⚖️ AI Chat = Legal Risk
Chat logs with AI tools (like ChatGPT) could be discoverable in court. If your team’s sharing sensitive info with external AI, talk to Legal now — what you type can and will be used against you.
🧠 AI Changing the Diagnosis Game
Ultromics' EchoGo is now FDA-cleared and Medicare reimbursed, using AI to identify elusive heart conditions with 73% better accuracy. This is not just cool tech — it's a sign AI is maturing into core clinical infrastructure - offering ways to cut down on the trail and error of diagnosing complex diseases.
🧭 Humanities vs Engineering: A Leadership Lens
Engineering disciplines are accountable to math and physics. Humanities? To persuasion and perception. Great leaders will need to balance both — but must know when math trumps narrative.
Bonus: The latest S3T Healthcare Panorama is now available for paid memberships.
You're now tuned into the deeper signals beneath the noise. From healthcare shifts to legal blind spots in AI, and from global trade currents to economic undercurrents — you’ve got the advantage. Ready to lead the week, sharper and ahead of the curve. ✅
You’re done! Whenever you need more context and insight come back and enjoy the rest!
[perspective]
US Healthcare innovation cycles: digital health->unified data->financial innovation
This week the White House, CMS and a set of healthcare companies pledged to modernize or create (depending on which release you read) a "patient-centric healthcare ecosystem."
- "White House, Tech Leaders Commit to Create Patient-Centric Healthcare Ecosystem...Leading Healthcare, Tech Companies Pledge to Work on Interoperability & User-Friendly Apps." CMS Newsroom Press Release
- "The Centers for Medicare & Medicaid Services (CMS) is taking bold steps to modernize the nation’s digital health ecosystem" CMS Health Technology Ecosystem Overview.
- List of companies making the pledge to participate: companies listed by industry category.
The previous cycle: digital health startups
This latest hoped for innovation cycle comes on the heels of a cooling period (Tom Loverro called it a mass extinction event) for a previous cycle where digital health startups were a focus:
- Venture capital funding rounds for US digital health startups have hit a 5 year low CBInsights Q2 Digital Health.
- The average deal size is up: fewer, larger deals that emphasize AI and later stage ventures. (Rock Health H1 2025)
- US average deal sizes continue to be 2-3x of other regions as noted starkly in this KPMG Venture Pulse Q2 2025 chart, suggesting that the US startup industry needs to reconnect with its original lean and scrappy roots.
Realities that investors are navigating:
- Too many digital health startups were launched in the previous era of easy money (That era is over). Investors are left to figuring out what to do about all this locked up capital.
- The digitization of healthcare went as far it could and hit a wall: US healthcare's fundamental risk and cost model. Until that is updated, affordability and investor ROI will be elusive.
- This requires deeper, more fundamental change than wearables, apps, data standards & AI analytics.
True change or just another gravy train?
Data needs to be less fragmented, yes, but the equations that make use of the data need to be rewritten. And yes, a patient centered ecosystem is essential. But this will have to be more than a bunch of healthcare vendors lining up to add more cost to the system.
Continue reading in the latest version of the S3T Healthcare Panorama.
S3T Panoramas are unique executive briefings that provide leaders and investors with 2 essentials:
- Broader view of the drivers and overlooked trends shaping an industry.
- Clarity on the root cause issues and how to capitalize on the shifts and changes underway.
In case you missed it:
Humans can be convinced of almost anything. The rest of the universe, not so much.
2 Categories of Disciplines Every Change Leader Must Understand. Humanities vs Engineering disciplines are different not just in content, but in accountability. Going forward, this has huge implications for your decision making and your workforce.
[macro-economics]
See the S3T Economic Dashboard for the Top 500+ US & International real-time economic indicators.
Current business environment: positive signs amid continued concerns
Despite favorable GDP figures and a slight uptick in consumer confidence, the U.S. economy shows slowing business investment, lower growth vs 2024, with inflation still a concern. Cautious optimism is warranted, but plan for persistent cost pressures, and shifting demand patterns.
- The Fed kept interest rates steady at 4.25% this week, after prices increased again in June.
- GDP rose 3% - higher than the expected 2.3%, but may be more a reflection of import/export math than healthy economic growth - Business investment decreased. Growth in the first half of 2025 is less than half of what it was the same period of 2024.
- Consumer Confidence increased 2.1% in July. This is still 4.6% lower than this time last year so we have room for improvement. But this is welcome news.
India rising in the multipolar world
India overtakes China in iPhone exports to the US, and Apple may be on track to source all iPhones from India before 2027. (Apple started assembling iPhones in India in 2017). iPhones are currently exempt from tariffs.
India US trade talks have stalled as the prospect of 25% tariffs loom. Perspective from India: "India must be careful" Preeti Anand writes, because:
- Tariffs won't directly impact India's substantial IT outsourcing and software services, but could indirectly impact as American firms have to cut costs due to inflation.
- Expect low growth in the near term as US firms trim their budgets
- Focus on building more advanced tech skills and expanding in markets outside the US
Related: India's gated communities are flourishing (Economist) but as residents comment in this Reddit, the "rich India/poor India" issue continues.
[emerging tech]
AI & Legal Discoverability
ChatGPT CEO Sam Altman reminds us that what you and your staff share with ChatGPT could be used against you in a court of law.
This likely applies to any conversational AI solution where one company's private data or information is entered into another company's computing environment and retained there. Logs of interactions between company staff and an AI solution could be subject to discovery requests or a subpoenas during the discovery phase of litigation.
➡️ Recommended action: check in with your legal team on how best to manage this risk.
AI reducing subjective interpretation of complex medical diagnosis
Ultromics has created EchoGo the first FDA-cleared, Medicare reimbursed AI solution for detecting 2 heart conditions that are very difficult to diagnose, and often rely on costly trial and error to arrive at an accurate diagnosis.
EchoGo's AI model was trained the world's largest echocardiogram datasets, and in a trial of 430,000 echocardiograms improved detection rates by 73%.
🙏 Thank you for your change leadership, and your work to drive intentional innovation and beneficial change.
Kudos to you. You just invested your time sharpening your thinking on key issues and staying informed on the top business and tech developments. In doing so you demonstrated that you care about your own success and the success of your customers and your team. Have a great weekend! And great wins in the week ahead!
Opinions expressed are those of the individuals and do not reflect the official positions of companies or organizations those individuals may be affiliated with. Not financial, investment or legal advice, and no offers for securities or investment opportunities are intended. Mentions should not be construed as endorsements. Authors or guests may hold assets discussed or may have interests in companies mentioned.
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