Marlinspike is a veteran-led venture capital fund that is investing in dual-use technologies that solve national security challenges and create innovative commercial applications. Pulse 2.0 interviewed Marlinspike co-founder and Chief Investment Officer Mislav Tolusic to learn more about the firm.
Mislav Tolusic’s Background
What is Mislav Tolusic’s background? Tolusic said:
“I was born and raised in Croatia. After receiving my Bachelor of Science degree from the University of Zagreb, I began my career at Airbus UK, where I quickly realized that my strengths lay more in strategy development than in engineering. In 2003, I moved to the U.S. to pursue my MBA at Vanderbilt University. Upon graduation, I relocated to Dallas and joined Highland Capital Management, where I worked on the distressed investing team, focusing on aerospace and manufacturing. After that, and before joining Marlinspike, I served as Chief Investment Officer and Partner at AIM13|CVP Partners, an investment vehicle co-managed by Crumpton Global and AIM13, in addition to being a Partner and CFO at the Crumpton Group. It was during this time that I truly honed my skills, pioneering a hands-on approach to venture investing, building deal-sourcing networks, leading due diligence, negotiating transactions, and serving on the boards of portfolio companies.”
“When my co-founder, Neil Keegan, and I launched Marlinspike, our foremost goal was to contribute to the mission. Having grown up in a communist country, keeping America strong is deeply personal to me. We determined that the best way to contribute to this mission was to ensure that our fighting forces are equipped with the most modern, cutting-edge technologies. However, all cutting-edge technology is only as sustainable as the unit economics underpinning the companies providing it. By investing in promising companies, we are able to marry profit with purpose.”
Evolution Of Marlinspike’s Thesis
How has your firm’s thesis evolved over time? Tolusic shared:
“Our firm’s investment thesis has not significantly evolved over time; it has remained fairly constant—we are investing in technologies that have use cases in both national security and commercial markets. What has changed over time are the specific industry verticals in which we invest.”
“We generally categorize companies into product or infrastructure companies. The products we invest in typically address specific use cases (e.g., cars transport people), while our infrastructure investments enable these products (e.g., tires on a car). We generally prioritize infrastructure companies. We believe that infrastructure investments are less risky and offer greater exposure to overall market growth compared to relying on the traction of individual products in the marketplace.”
“In 2022, we spent considerable time building out our space infrastructure investments—Voyager Space, Privateer, and Rendered.ai. In 2023, we focused specifically on AI, particularly in security and edge processing. We invested in Kindo, an AI governance and security application, and Armada, a provider of edge computing services. In 2024, our focus shifted to autonomous vehicle infrastructure.”
“So, while our priorities and focus areas may shift over time, we are always seeking companies that operate at the intersection of national security and commercial industries.”
Significant Milestones
What have been some of your firm’s most significant milestones? Tolusic cited:
“During the Silicon Valley Bank crisis, we took decisive actions and ensured that all of our companies with exposure to SVB were on sound footing, regardless of governmental (in)action. If you recall, SVB suspended all withdrawals on Thursday around noon. By Thursday evening, we had a full accounting of funds tied up, assessed cash needs across our portfolio companies, and conducted an analysis of recovery rates. On Friday morning, we drew on our line of credit and made two investments into our existing portfolio companies. In parallel, we worked with all the companies to ensure they each had 30 days of liquidity. By Saturday afternoon, we had a plan in place, and all the companies were in good shape no matter what happened.”
“In my mind, it was a significant moment that demonstrated our team’s capability to execute in the most challenging environments. We played offense while the rest of the world was on defense.”
Investment Success Stories
When asking Tolusic about investment success stories, he highlighted:
“Yes, we invested in Anduril in 2022, and the company has been on a tear. Recently, the company won a Phase 1 contract for the Collaborative Combat Aircraft program—this was the first time that a large defense program was not awarded to one of the defense primes.”
“Our investment in Anduril embodies the essence of our investment theme—we believe that our defense industrial base is undergoing a fundamental change, where new companies will become the next industry champions. The aerospace and defense market is enormous—if the Department of Defense were a country it would be a member of G-20 (20 largest economies).”
Industry Focus
What are some of the industries that your firm is focused on? Tolusic noted:
“First and foremost, we are dual-use investors, meaning we focus on companies and technologies that have both defense and commercial applications. Securing a meaningful foothold in the defense industry is very difficult, so without a pathway into commercial markets, a company’s upside is limited and, therefore, off our radar as we’re focused on sizable returns for our LPs.”
“Our first fund focused primarily on aerospace, AI, robotics, and cybersecurity—industries that the DoD and intelligence community rely on, and that are also poised for innovation. Our marquee investment in Anduril is the epitome of aerospace innovation, and our investments in Privateer, Voyager Space, and OurSky were ahead of the curve, considering the multinational efforts to build the new, privately-owned space station and the entire space ecosystem along with it.”
“AI has, rightfully so, captured the interest of commercial enterprises, small businesses, and the defense industry. Our first fund featured Kindo AI, which secures proprietary data when using LLMs, and Armada, which was the first full-stack AI edge computing hardware system that now has the backing of Microsoft’s venture arm.”
“AI and aerospace remain top priorities for our firm, but as we delve deeper into defense systems, warfare, and commercial gaps, we’re increasingly focused on cybersecurity, advanced manufacturing, and niche digital tools that will power the next generation of technology.”
Differentiation From Other Firms
“First, we are a problem-thesis-driven fund—we develop theses around problems and then look for solutions. This approach allows us to focus our sourcing efforts and have pointed discussions with founders. We can quickly discuss parameters and make decisions on how much time we want to dedicate.”
“Second, we take a private equity approach to our portfolio management. This means that we take a proactive stance: we roll up our sleeves and work with founders on their toughest challenges. We like to be in the game, but not run the game—our founders run the game.”
Advice For Companies Looking To Enter Defense Sector
What advice would you give companies looking to enter the defense ecosystem? Tolusic advised:
“Defense is a hard business to be in. While securing government grants can be fairly straightforward, generating recurring revenues is a completely different challenge. Government sales cycles are very long, and decisions are never vested in just one person. You shouldn’t be surprised if I told you that there is always a committee!”
“I would advise founders to look at what public companies in the space look like and to figure out how their companies can achieve the breadth and depth required to become public. Unlike typical tech companies, public companies in defense markets have significantly more breadth and depth—multiple product lines and capabilities.”
Obstacles Faced
What are some of the obstacles you faced while working in the industry? Tolusic acknowledged:
“As defense investing continues to grow and attract more venture capital, we’re starting to see higher valuations that don’t align with the total addressable market (TAM). What many founders, especially first-timers, don’t understand is that valuations are a two-sided coin in this industry. While founders may think they have a good shot at tapping into the DoD’s $142 billion (FY 2023) procurement budget, it is an incredibly difficult and cumbersome process to unlock. If you’re a defense-focused company and have a strong round, you’ll have to keep chasing bigger rounds, which will rely on securing significant DoD capital—something that few have achieved. We’ve encountered companies with incredible technology and teams but have had to walk away because other funds were driving up valuations that we believed were not in the best interest of our LPs.”
Future Firm Goals
What are some of your firm’s future goals? Tolusic concluded:
“Our goal remains the same: Rearm & Rebuild America by investing in innovative companies that can bolster our national defense, present a deterrent to hostile nations around the world, and rebuild our industrial base.”
