June 25, 2025

CVC does not always lead to acquisition

Innovation in 2025 is accelerating fast, with new KPIs, global partnerships, and AI-powered tools redefining how companies measure success. M&A is bouncing back across pharma, finance, and tech as leaders seek strategic growth and resilience. AI infrastructure spending is skyrocketing, reshaping cloud, data, and operations. Meanwhile, sustainability and digital-first strategies are transforming industrials and manufacturing. From precision medicine to streaming wars, every sector is adapting to stay ahead. The message is clear: agility, clarity, and execution are the new competitive edge.

(Est. reading time: 5 mins)

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It's time for another 🛰️ FounderNest Flyby Newsletter 🛰️, where we help you stay sharp with innovation trends and insights.

In today’s newsletter:

💡 Thoughts from our blog
🗞️ Quick hits from this week’s news
📡 5 emerging trends from our industry radar
💼 This week’s pharmaceutical deep dive
🤖 Infographic: The new metrics of innovation

Thoughts from our blog.

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Quick hits.

Short and sweet - news that caught our eye this week.

CVC does not always lead to M&A: Despite high CVC activity, only a small fraction of CVC-backed startups are ultimately acquired by their corporate investors. Strategic returns often come in the form of market access, technology, or competitive advantage rather than outright acquisition, highlighting the need for large organizations to clarify their innovation goals and acquisition strategies.

Innovation management maturity and challenges: According to the 2025 State of Corporate Innovation Report, 87% of large organizations struggle to turn ideas into outcomes, with weak mid-to-late-stage processes and a focus on financial metrics despite efforts to build an innovation culture.

Sector highlights in US M&A: The most active sectors for deals over $100 million included technology, industrials, and financials. Information Technology led with $87 billion in deal value for Q1 2025, followed by Industrials ($84 billion) and Financials ($77 billion).

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Industry radar.

Stay ahead of the curve every newsletter we give you 5 of the hottest topics and trends across our reference industries.

1. Technology:
The technology sector has seen a surge in deal value in Q1, reaching $64 billion - outpacing every quarter since 2022. Big Tech is projected to spend over $300 billion on AI infrastructure this year, fueling a race for data centers, computing power, and specialized software.

A sample of AI infrastructure companies in the tech industry that leverage cloud computing or data storage technologies in FounderNest

2. Financial services

Capital One’s $35 billion acquisition of Discover Financial Services is set to create a dominant player in credit cards and consumer banking. The financial sector is also seeing strong M&A in fintech and payments, driven by demand for digital solutions and customer data analytics.

3. Industrial

Industrial companies are targeting tech assets to modernize operations. HPE’s $14 billion acquisition of Juniper Networks aims to boost cloud and AI capabilities for enterprise clients. There’s also a focus on energy efficiency and smart infrastructure, with M&A supporting the shift to sustainable and digital-first operations.

4. Pharmaceuticals

After a subdued 2024, 2025 is seeing a significant uptick in pharmaceutical and biotech M&A, with large companies aggressively pursuing deals to expand pipelines and strengthen positions in key therapeutic areas such as oncology, neuroscience, and cell therapy.

5. Media and entertainment

Media companies are investing heavily in AI-driven content creation and personalized streaming. Consolidation continues as traditional and digital players vie for audience share and new revenue streams. Comcast is spinning off NBCUniversal’s cable TV networks, combining them with digital assets to focus on streaming and ad tech.

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Deep dive: Pharmaceuticals.

Comprehensive, personalized industry insights - straight from our platform.

TL;DR

💊 Patent cliff pressure: Pharma giants are using M&A to replenish pipelines and defend against looming revenue losses
🤝 Innovation by acquisition: Strategic deals target oncology, neuroscience, and advanced therapies
🌐 Global partnerships: Licensing, collaborations, and China’s rise are reshaping the innovation landscape

1. 💊 M&A defends against the patent cliff

Facing a wave of blockbuster drug expirations, pharma leaders are ramping up M&A to secure next-generation assets. 2025 has seen a sharp rise in deal value, with big players like Johnson & Johnson, Novartis, and Merck KGaA making billion-dollar acquisitions to strengthen portfolios in mental health, rare diseases, and RNA therapies.

2. 🤝 Innovation through targeted deals and partnerships

Strategic acquisitions and licensing agreements are now the norm. Companies are focusing on precision oncology, cell therapy, and digital health, often through multiple smaller deals rather than mega-mergers. AI-driven drug discovery and digital therapeutics are hot targets, accelerating R&D and market entry.

3. 🌐 Globalization and regulatory complexity

US and European firms are increasingly partnering with Chinese biotechs, tapping into global innovation. Meanwhile, regulatory and policy shifts, especially in the US are influencing deal structures and timelines. Companies are navigating a complex environment to stay ahead.

Summary

Pharmaceuticals in 2025 are defined by proactive M&A, global collaboration, and a relentless push for innovation. The winners are those who move fast to fill pipeline gaps and embrace new science and technology.

Find the full research here.

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The new metrics of innovation - how they have changed over the past decade.

In 2025, innovation measurement is shifting from protecting IP to driving performance and impact. Companies now prioritize real-time, tech-enabled KPIs that track speed, adaptability, and outcomes. Powered by AI, IoT, and cloud tools, these metrics are becoming board-level priorities, linked to higher ROI and faster delivery. However, overuse or misalignment of KPIs can hinder creativity. Industries are adopting tailored KPI strategies, emphasizing smarter, not more, measurement.

Shift from protection to performance

Traditional KPIs focused on IP protection are being replaced by metrics that prioritize speed-to-market, adaptability, and impact.

Tech-driven measurement boom

AI, IoT, and cloud platforms have enabled organizations to track significantly more real-time and predictive KPIs, making innovation measurement more dynamic and insightful.

Strategic governance

KPI tracking has become a board-level priority, with structured systems leading to more than double the innovation ROI and faster market delivery.

Cultural risks of over-measurement

While KPIs drive accountability, misaligned or excessive measurement can stifle innovation and employee creativity.

Sector-specific KPI strategies

Industries like high-tech, pharma, and finance are adopting tailored KPIs (e.g., AI, sustainability, electrification) to reflect their evolving innovation landscapes.

View the infographic here.

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