1. Natural Moat
Since human body hardware is more or less immutable in its most essential parts, you don't have to worry about some LLM hype cycle replacing you. Once you build the product and clear FDA or local certifications, you're set. Unlike Uber destroying the taxi medallion business, healthcare is a beast — no tech startup dares to bypass all the regulations and gatekeeping.
2. Regulatory Moat
The medical devices I'm talking about require around $50K–$200K for FDA clearance — low enough that any small business can manage it, but high enough to discourage bottom-feeders and Chinese product dumpers. It also lets you avoid the big established healthcare corporations, because this market segment is too small for them to care about, yet large enough for you to pull in $10M–$15M a year in revenue.
Medical device manufacturing sidesteps the two fatal flaws of software development: the lack of a moat and static, almost never-changing hardware margins. LLM companies don't care about copyright, IP, or the health of the broader economy — but they can't go head-to-head with the healthcare industry, so you don't have to worry about them at all.
Then if you hit the market you are going up against the most connected, cutthrough, organized and entrenched sales forces from the large device companies who make tech b2b sales look like kindergarteners on the playground. The medical offices, site staff and hospitals all try to block access to your sales force so you are probably going to need to fund and deploy an MSL and RSL force as well and present at all the industry conferences to get any leads and traction.
Then even if you have customers who want your device it won't matter unless you develop a patient access team, lobby to secure reimbursement from insurers otherwise all your previous efforts are wasted. So now you need a market access team and you're probably $200 million in the hole, and you're dead in the water if CMS won't get onboard for reimbursement because all the private insurers generally wait and see what CMS does. Meanwhile any time any of your suppliers change you'll need to run more trials to show validation for safety and efficacy.
With average time to market is 12 years, 75% of new device companies fail for a reason.
The costs itself to enter already makes it close to impossible without outside funding which is why you see less startups in this and more vibe-coded toys that are at best experiments.
No-one would be happy to hear that they are using a "vibe coded" medical device instead of the established solutions.