July 4, 2026, (Inside AI) — Michelle Turner, a foster mother of six in Virginia Beach, had no MBA, no startup experience, and no venture capital connections. Yet in January 2025, she launched Here Now Health, a mental health platform for foster children, now certified in three states to provide Medicaid-funded counseling. The company has grown to 16 employees.
Turner credits artificial intelligence as her silent co-founder. She used AI tools to learn startup fundamentals, craft a business plan, and refine her investor pitch. “A mom of six kids who's a first-time founder, who's a sole female founder, should not be able to raise (venture capital). I don't have an MBA. I don't have these things to back me up,” Turner said. She described her AI-guided preparation as “like going to a master's level class every day from the robot. It was my startup advisor.”
Her story illuminates a broader economic shift. AI is not just for tech giants; it is enabling traditional service businesses to launch faster and cheaper. John Bailey, a nonresident senior fellow at the American Enterprise Institute and adviser to an investor in Here Now Health, said such cases are becoming common. “Things that used to take too much time or cost too much — the price to access has fallen close to zero,” Bailey noted. “It is empowering entrepreneurs to scale faster and hire people. These are not AI companies. They are traditional companies trying to deliver services but do it faster, cheaper.”
Turner’s journey began with her own experience as a foster parent, where she saw a gap in mental health care for children entering the system. With AI, she turned that insight into a venture-backed company. The technology, she said, acted as her startup advisor, democratizing access to business expertise.
The Federal Reserve is closely watching such developments. New Chairman Kevin Warsh has launched a broad review, with one panel focused solely on AI’s productivity implications. At his debut press conference, Warsh called AI the most important economic change “that we've had in my adult lifetime,” and said the U.S. “is ultimately going to be better off” because of it. But he added, “that certainly doesn't mean it's not going to be disruptive.”
Some Fed officials have raised the possibility of structurally higher unemployment. Others point to labor’s declining share of national income, questioning if AI will disproportionately benefit capital. Richmond Fed President Thomas Barkin is wrestling with these risks but also sees AI easing worker shortages in skilled trades. “We are all quick to see the disasters, which is about jobs getting replaced,” Barkin said. But he noted that firms in auto repair or manufacturing “are still in a world of saying they cannot get enough workers,” and are using AI to boost productivity.
The AI investment boom is already driving demand for data centers, pushing up power and labor costs. Jean Boivin, head of the BlackRock Investment Institute, described competing narratives of scarcity versus abundance. “Scarcity is the story of the moment” with the AI boom driving up costs, he said, but “we are also talking about abundance....We are talking about AI that can lead to significant breakthroughs...Growth that might be breaking out of a 2% world.”
Torsten Slok, chief economist at Apollo Global Management, attributes a recent uptick in new business formations to AI, which is “dramatically reducing the cost and complexity of launching a company. As these firms scale, they will create jobs.”
Yet the transition may be painful. A recent study by the Brookings Institution and Opportunity@Work warns that about 23 million workers, particularly those without college degrees, face a high risk of AI displacement. Their logical next career steps are into roles highly exposed to automation, potentially stranding them in lower-paying jobs. The impact is concentrated in Florida, the Northeast, Texas, and California.
The Fed’s challenge is navigating the short-term disruption against the long-term promise of a productivity boom. Turner’s success shows AI’s potential to level the playing field for entrepreneurs. But for millions of workers, the path forward remains uncertain.
