Highlights
- PS27 Ventures focuses on AI-driven investments in B2B SaaS, FinTech, and health tech, leveraging “sticky plumbing” software that is mission-critical and deeply embedded in companies.
- The fund evaluates up to a couple thousand deals a year, using a strict minimum revenue threshold (~$240k-$300k ARR) and a comprehensive diligence process including a unique “workout” session with founders.
- AI is integrated at every step of PS27’s diligence, with proprietary grading models assessing founder traits and competitive landscape analysis enhanced by tools like Grok AI.
- Portfolio companies benefit from intensive post-investment support via weekly sales calls, fostering continuous improvement, accountability, and long-term collaboration.
- PS27 avoids inflated rounds common in 2021-2023, encouraging founders to raise smaller, more efficient capital rounds leveraging AI-driven productivity gains.
- In FinTech, the fund prioritizes companies innovating seamless, non-crypto payment systems for easier peer-to-peer cash flow.
- Hale’s transition from Navy nuclear engineer to VC investment manager provides him with unique operator insight, enhancing his empathy and value-add as a partner to founders.
Summary
In this episode of The Innovators and Investors Podcast, host Kristian Marquez interviews Hale Bullen, Investment Manager at PS27 Ventures, a Jacksonville-based venture capital fund that focuses on AI-driven investments primarily across B2B SaaS, FinTech, and health tech sectors. Hale delves into their fund’s unique investment thesis, which emphasizes “sticky plumbing” software—mission-critical, embedded solutions that companies rarely replace once implemented. The interview covers PS27’s rigorous deal flow and due diligence process, with a particular spotlight on a collaborative “workout” session where the VC and founders engage deeply to close investment deals and shape the company’s next steps.
Hale also describes the firm’s extensive use of AI throughout the investment pipeline, from founder evaluation using proprietary scoring systems to competitive analysis facilitated by tools like Grok AI. The conversation highlights current market trends such as the emergence of AI agents for automation, especially in operational workflows like health tech onboarding. Within FinTech, PS27 is particularly bullish on innovations that improve the seamless transfer of payments across fragmented platforms, rather than crypto or Web3.
Post-investment, PS27 maintains a high-touch weekly engagement model with portfolio companies, supporting founders with direct advice, financial discipline, and continuous mentorship—a contrast to many larger firms with more transactional relationships. Hale notes the evolution of venture capital dynamics, especially following the inflated valuations seen between 2021-2023, emphasizing a smarter, leaner capital approach that encourages smaller, more strategic raises aided by AI productivity gains.
His background as a Naval Academy graduate and nuclear engineer turned startup operator deeply informs his empathetic and practical approach to working with founders. Hale concludes with reflection on mentorship’s value throughout his career and recommends keeping an open mind about career paths, underscoring the significance of trusted mentors in both military and professional arenas.
Key Insights
- “Sticky Plumbing” Investment Thesis: PS27’s focus on foundational, mission-critical software (“sticky plumbing”) reflects a strategic preference for enterprises relying on technology that runs deeply within their operations and is infrequently replaced. This approach reduces churn risk and ensures predictable, durable revenue streams for portfolio companies. It differentiates PS27 from funds chasing flashy, high-visibility startups, instead backing startups that deliver essential infrastructure—a high-barrier-to-entry niche that leads to long-term partnership stability.
- Robust Diligence and “Workout” Process: The six to eight-week diligence culminating in a “workout” session is designed to uncover not just financials but also leadership dynamics and team cohesiveness under pressure. Inviting the whole executive team to participate in real-time Q&A showcases how PS27 prioritizes founder transparency, alignment, and real-world problem-solving ability. This intense personal interaction helps solidify trust, identify gaps early, and align expectations for the critical first 100 days post-investment.
- AI Integration Through Founder Evaluation and Due Diligence: PS27’s deployment of AI-powered scoring systems to evaluate founder traits against data from successful startups demonstrates an innovative approach to quantifying founder potential—beyond traditional subjective judgments. Using tools like Grok AI for competitive analysis accelerates due diligence and reduces human error, providing an edge in quickly sorting through the large dealflow volume. AI’s role here exemplifies venture capital’s evolution towards data-driven decision-making.
- Emerging Themes in AI Applications: The investment in companies like OnRamp, which use AI agents to significantly reduce operational onboarding times, illustrates the concrete impact AI agents have in automating complex workflows, particularly in regulated environments like healthcare. This example reflects a broader industry shift toward AI-enabled process automation, driving efficiency and enabling companies to accelerate go-to-market timelines and reduce costs—a trend PS27 is actively backing.
- Adapting to New Capital Efficiency Paradigm: In response to a post-pandemic recalibration of valuations and capital availability, PS27 emphasizes smaller seed and pre-Series A rounds, encouraging disciplined spending and leveraging AI to “do more with less.” This approach reduces fundraising drag on founders and better aligns with realistic growth expectations. It pushes against the prior era of large, excess funding rounds, signaling a maturation of startup capital markets toward sustainability and profitability focus.
- Clear Revenue Growth and Profitability Expectations: PS27 expects portfolio companies to at least double revenue every 6 to 12 months and requires a clearly articulated path to break-even. This insistence on profitability or near-term profitability aligns with today’s economic landscape of tighter capital markets and higher interest rates. Companies without a feasible runway to profitability are typically filtered out, reflecting the fund’s risk-aware and pragmatic investment posture.
- Operator-led Venture Investing: Hale’s military and startup operational background lends PS27 significant empathy for founders’ real struggles, equipping the team to provide practical advice and meaningful post-investment support. Such operator experience in VCs is increasingly recognized as valuable for improving outcomes, as it fosters deeper communication, trust, and strategic partnership, with investors who “have been there” and can advise effectively.
Additional Insights
- Investor Specialization and Fund Size Strategy: PS27 deliberately maintains a lean fund size (~$20-$25 million) focused on pre-Series A deals to avoid the bloat and inefficiency seen in mega-funds. This specialization enables a nimble team capable of rapid adaptation to emerging AI tools and market shifts, contrasting with larger funds that may struggle with operational overhead and slower decision-making.
- Weekly Sales Calls Post-Investment: The dedicated weekly sales calls with founders exemplify a hands-on VC approach enabling continuous feedback, accountability, and dynamic problem-solving well beyond the typical quarterly board meeting cadence, fostering deeper relationships and better growth trajectories.
- Geographic and Industry Synergies: PS27 leverages its Jacksonville, Florida location strategically, tapping into regional financial service ecosystems and health systems to identify and support startups addressing local market needs—demonstrating how regional VCs can provide differentiated value by combining geographic footprint with sector specialization.
- Mentorship as a Critical Success Factor: Hale’s emphasis on having multiple mentors across different life domains highlights mentorship’s role not only in his career evolution but as a cultural pillar likely reflected in how PS27 supports its founders, reinforcing the human element intrinsic in VC relationships.
This conversation offers a comprehensive and insightful look into how a modern VC firm undercuts hype in favor of substance, utilizes AI to optimize deal scrutiny and founder evaluation, and pairs technical and operator expertise to champion sustainable startup growth trajectories.
Stay up-to-date with Harry Bullen and his work at PS27 Ventures.
Follow the show on your podcast channel of choice or listen below:
