Navigating Black Swan Events in Volatile Markets

In many ways, in this market turmoil, healthcare services is feeling like a decent bet. Relative to other sectors, it’s highly domestic, and it’s less unpredictable in periods of economic uncertainty. People still get sick during recessions. And yet, the part of healthcare that most of the readers of this newsletter inhabit — startups, venture and PE firms, innovative care delivery businesses, and so on — are certainly going to be impacted. Just look at Hinge Health, the high-growth, venture-backed virtual MSK business that is now reportedly considering delaying its IPO because of the market.

I say healthcare services very deliberately, because biotech is getting absolutely crushed.

As someone who spends too much time on X and Reddit, the prevailing sentiment amongst investors seems to be this upcoming period will continue to be a “have and have nots” market. Those in the spaces considered hot - where follow-on funding will be theoretically less hard to come by or where traction is absolutely undeniable - will continue to do well. But companies that require a thoughtful, strategic investor willing to put the time into making them successful, typically through an injection of capital, and a new strategy and/or team, I’m worried. No one has a crystal ball but we do know that the VC market does not tend to thrive in periods of unpredictability. And LPs, at some point, want liquidity.

Given the economy is on everyone’s minds, I sat down this past week with two of my favorite humans, one a health investor and the other an economist. They also happen to be married. That’s Meghan Fitzgerald, an advisor at TowerBrook and Goldman — and a nurse! — as well as a board member at publicly-traded companies like Tenet. Meghan also teaches at Columbia as an Adjunct Professor. Her husband, Michael Darda, is a chief economist and macro strategist at Roth Capital Partners, and he’s also a frequent contributor to my former employer CNBC. He’s a busy man these days, but I fired off a “Four questions with” to get his sense of things, particularly from a healthcare POV (hot take: he’s actually seeing potential).

This post kicks off with a column from Meghan on why she thinks that our sector is caught up in a “turbulent migration” or black swans, and where we need to go from here, followed by Darda’s take on the macro issues at play. I hope you find their takes as useful in navigating the current moment as I have.

Healthcare is in a major “black swan” moment

By Meghan Fitzgerald

TL;DR: The healthcare sector is facing a wave of unpredictable, high-impact transformations—from GLP-1 disruption to AI acceleration. Leaders can thrive in unpredictable environments if they build resilience and flexibility into their organizational culture and financial plans.