In a mixing bowl, combine the turkey, salt, pepper, shallot, garlic, parsley, Parmesan, breadcrumbs, and egg (if desired). Mix just until combined. Don't overwork.
Form 12 meatballs from the mixture.
Heat the Instant Pot on sauté mode. When hot, add the oil. Then add the meatballs and sear until browned, about 2 minutes per side. Allow them to sear well before turning, so they don't stick to the pan.
Turn off sauté mode.
Pour in the chicken broth and use a spatula to carefully deglaze the bottom of the pot.
Close the lid and turn the pressure valve to sealing, if necessary. Press the pressure cook or manual button and set the cook time to 6 minutes.
After the time is up, allow a 5-minute natural release, then manually release the remaining pressure.
To make the gravy, turn back on sauté mode and remove the meatballs from the pot. Once the pot is hot, add the butter. Stir together the cornstarch and water and add it to the pot. Whisk constantly until the gravy boils and thickens. Return the meatballs to the pot to warm them up in the gravy.
Serve over mashed potatoes, rice, pasta, or on its own.
Notes
If the turkey meatballs are sticking to the bottom of the pan, make sure you allow them to fully sear before moving them. This will help them release from the pan easier.