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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
💼 This week’s insurance deep dive
📡 5 emerging trends from our industry radar
💬 Top insights from surveyed innovation leaders

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Thoughts from our blog.

In today’s newsletter:

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Quick hits.

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

🤖 In a recent article by The Financial Times, AI agents are evolving from simple assistants to autonomous systems capable of executing complex tasks with minimal human intervention. This shift enables innovation teams to focus on strategic initiatives while AI handles routine operations.

🌍 The European Commission has announced a €500 million funding package to attract top researchers, aiming to position Europe as a global leader in science and innovation. This initiative responds to shifts in global academic dynamics and underscores the importance of talent in driving innovation.

📉 91% of innovation departments in 2025 say the era of ‘innovation theater’ is ending, according to a survey by ITONICS, as leadership now expects measurable results linked to business goals. Teams must focus on revenue, cost savings, and transformative growth.

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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 and software: AI agents evolving from co-pilots to autopilots

AI agents are transitioning from simple “co-pilots” to more autonomous “autopilot” systems, capable of executing complex tasks with minimal human intervention. This evolution is driven by advancements in large language models (LLMs), machine learning, and computing power.

2. Pharmaceuticals and healthcare: Surge in M&A deal value

The biopharmaceutical industry saw a 101% quarter-on-quarter increase in total deal value in Q1 2025, reflecting renewed confidence and strategic urgency among major players. This surge is driven by looming patent expirations-190 drugs are set to lose exclusivity by 2030, prompting large companies like Merck, Bristol-Myers Squibb, and Pfizer to pursue acquisitions to replenish their pipelines.

3. Manufacturing: Smart factories and digital transformation

Smart Factories and Digital Transformation: The industry is investing in smart factories that leverage edge-cloud integration, software-defined automation, and comprehensive digital transformation strategies to increase flexibility, reduce costs, and enhance responsiveness to market demands.

A sample of smart factories and digital transformation companies in FounderNest

4. Defense: The drive for advanced technologies

Key technological focus areas include artificial intelligence (AI), autonomous and unmanned systems, cybersecurity, hypersonic weapons, and space technologies. The drive for digital transformation in manufacturing and maintenance is also spurring deal activity as companies seek specialized capabilities.

5. Insurance: Global M&A recovery expected in 2025

Global M&A Recovery Expected in 2025: Despite a slowdown in 2024 due to geopolitical uncertainty, high interest rates, and regulatory challenges, 2025 is expected to see a recovery in insurance M&A activity. Rising investor confidence, lower interest rates, and US policy shifts are expected to drive deals, with the E&S (Excess & Surplus) sector attracting foreign investment.

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Deep dive: Insurance.

Comprehensive, personalized industry insights - straight from our platform.

TL;DR

🏁 M&A is recovering in 2025, but stays below pre-pandemic levels
🤖 Insurtech funding is steady, driven by large AI-led investments
🌍 Ageing populations, climate risk, and regulation are impactful

1. 🏁 M&A activity: Recovery, not a boom

After a slowdown, insurance M&A is expected to modestly recover in 2025, led by U.S. deal volume and broker consolidation in the UK. The Middle East is also accelerating activity, but overall dealmaking remains below pre-pandemic levels, with a focus on strategic partnerships and tech-ready MGA acquisitions.

2. 🤖 Insurtech: Funding stabilizes, AI takes center stage

Global insurtech funding hit $3.2 billion in Q3 2024 and is on track to reach $4.2 billion by year-end, driven by large AI-focused deals despite fewer overall transactions. Mega-rounds from firms like Altana AI, Alan, and Zing Health led the surge, while late-stage startups, though seeing reduced funding, are expected to fuel the year’s final push.

3. 🌍 Macro trends: Demographics, climate, and regulation

By 2025, the global median age will reach 32, driving demand for retirement and longevity products, especially for underprepared Gen Xers. Climate risk is a growing regulatory focus, with UK authorities pushing for better risk management and capital alignment. Meanwhile, the cyber insurance market is set to grow 8% to $16.6 billion, maintaining strong momentum despite a slowdown.

Summary

The insurance industry in 2025 is defined by cautious optimism: M&A is recovering, insurtech is maturing with a clear tilt toward AI, and demographic and climate forces are driving both risk and opportunity. Strategic focus is shifting to tech integration, local partnerships, and product innovation for an aging, digitally savvy population

Find here the full research‍

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Top insights from innovation leaders.

Over 50 global innovation leaders gave us their insights about lessons they have learned from strategy and execution to measurement and scaling. Here is a quick summary:

Common challenges:

Innovation efforts often stall due to internal bottlenecks, cultural resistance, and the phenomenon of “pilot purgatory,” where initiatives fail to scale.

Evaluating trends:

Corporate innovation in 2025 is defined by tightly aligning with business goals like revenue growth and sustainability.

Securing internal buy-in:

Successful innovators craft compelling narratives, initiate small-scale pilots to build trust, and foster a sense of ownership among stakeholders.

Measuring success:

Beyond traditional KPIs, storytelling and framing the opportunity cost of inaction are vital in demonstrating the value of innovation initiatives.

Scaling strategies:

Effective scaling requires structured processes, dedicated resources, and a culture that embraces calculated risks.

Download our Corporate Innovation Playbook for even more insights.

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