Julie Bush on Valinor's Berkshire-for-defense model tackling the unsexy 80% of the defense market

Uh thank you so much for coming on the show. Have a great rest of your day and have a nice 2026. Good vibe. Our next guest is Julie Bush, the co-founder and CEO of Valenor Enterprises. They recently closed a massive series. Julie, welcome to the show. How are you doing?

What's going on?

Hey guys, it's so great to be here. I feel like you've had a thousand of my friends on and it's good to finally make the show.

Well, we've literally had some of your friends on. We've had the we've had Colin from Friends and Family on the show.

Yes.

The friends. had con founders fund was on earlier today.

I I spent a decade at Palunteer so I've

overnight success.

Yeah. Yeah. We got all of them. Uh but for those since it is your first time on the show, uh please give us an introduction on yourself and Valenor.

Yeah. So Julie Bush, co-founder and CEO of Valenor Enterprises and uh we're bringing a new business model to defense and national security. Um, you guys know as well as I do that the barriers to entry in this market are so high. And so we've built something really unique. We're an operational holding company to service the longtail problems, the the unsexy things that nobody is able to go after because the barriers of entry are so high. So you're really incentivized to go after the moonshots like the next generation fighter jets and the Golden Domes, but there's basically 80% of the the market that's just untapped. So, uh, walk me through operational holding company. Uh, what are you adding to? What are you holding? How old are these companies? How big are they? Uh, what can I compare it to in other pieces other holding companies that I might be familiar with?

Yeah, we're we're trying to be Berkshire Hathway for defense tech, right? And so for us, uh, we're we're holding product companies and, you know, that's usually software software defined hardware. Uh we started a little over a year ago and today we have five publicly launched product companies. Um we have 10 in the in the works. So we're actively working on three more and we likely will add two more before the end of 2026. So we're moving pretty quickly here and we're tackling everything from power systems for unmanned um autonomous systems

to combat casualty care. So think about parts of the the market that are really really critical but again like there hasn't been innovation there in in decades.

Yeah.

So talk

so so this so this is an example of a company like a company that maybe at scale like could only ever be a $50 million revenue business if they get every key customer. And so it's hard to like raise a lot of money at for an opportunity like that and build out some crazy gotom market team and and uh and so they can partner with you uh to get that distribution and basically get this platform to make it easier to sell into the government. Am I saying that uh right? Where am I wrong?

Yes, exactly. Like we can both build and buy companies. We hold them. We're the majority owners of them. We we run we centralize all the go to market and all the operations. And that allows us to move really really quickly. And then we decentralize engineering and we basically run them like product lines but their own they're their own subsidiaries. So we have a ton of flexibility. We're their capital allocator. Um, so you know, I I I know you guys also were following Defense Tech hype, but um, we're able to get great outcomes for our DMs and the engineering teams and these subsidiaries cuz, you know, they're not out there fundraising like they're focused on building a great product and um, we're we're basically doing everything else.

And and is uh I imagine part of the thesis here is you've have like hundreds of new defense tech companies and and and government contractors created. A lot of them will build great products but maybe not get to the scale where they can uh uh you know IPO or anything like that and you can come in and actually provide like an outcome and then the opportunity to actually continue to scale that business and so may maybe like a year or two years from now they'll there'll be even more opportunities on on the buy side.

That's right. That's right. I I mean I when I think about the market like I think we could be one of the ways many of these companies are able to be sustainable and endure after the hype goes away. I always like to say like we want to be the most sustainable company in this market um or platform of companies in this market and yeah I think earlier you said so um what about like is this like are we looking at like a $50 million TAM here for this product? I mean, I like to think

a lot of what we're working on, they're like

hundreds of millions of dollars tams behind them. Um, they just don't have to be 10 billion, right? Like they don't need to be Ander. They don't need to be Palunteer. And right now, everyone's getting pitched to be like like I'm the Ander of X. I'm the Palunteer of Y. Yep.

And there's really only going to be a handful of those companies.

Speaking of Anderol, are you Adam Porter Price's worst nightmare? Are you guys going up against each other to try and buy companies or do you target different market segments so you don't actually run into each other uh in back-to-back board meetings when a company is choosing to sell?

No, I mean I actually see him as a great partner for us and Steman, you know, sends me lists things they need, right? So I think they could be buyers of our of our assets. Yeah. just like I think the primes could be like the other large primes they need more innovation than Anderol does, right? Um just h so happens AP is like brilliant at uh M&A for Anderall, right? And so um I actually look to him as someone who is is really important to us.

Um and

so have you guys sold any any of the businesses yet or is that a is that a future?

No, I would say we're we're a little early for that, right? Um, but I do think, you know, it could be interesting in the next 18 months to see what happens. And of course, like each one of these is is their own individual strategy and like we can hold them too and we want to hold them. We we want I I think we can make a lot of these companies profitable really quickly because we can drive down their operating costs.

Yeah. How are you processing sort of the defense tech hype waves? you know, Ukraine happens, everyone wants to talk counter UAS. Uh Taiwan heats up, everyone wants to talk about uh surface vehicles and rebuilding the Navy and and those are important projects, but you can get sort of whiplash. Is there are there is there are there real pockets of value when there's a lot of energy and maybe a lot of executive orders and truth social posts about a category or do you want to sort of zoom out and be looking for more uh opportunities that might become big uh narrative arcs in the next five years or something like that? How do you think about these defense waves?

I love this question. I you know I've been in this market 20 years. I was at Palanteer 10 years. Built out most of the government business there. Um I think when there is a crisis or there is a you know we the pandemic was a a great example of this like it does create a different level of action within the government. I think this is part of why you know right now with department of war it's it's great to see them putting like sticks and carrots out there because it's creating action without a crisis. I don't think we want to wait till there's a crisis for you know us to be in a bad position. But I do think the hype comes in waves and you know you can seize it. I think Palanteer does a really good job of seizing that. That's something I really learned there. And and for us, you know, we are looking at things that are timely. There are things we are not going to build or buy right now just because we know where this administration's priorities are for the next 3 years. Um but I do think you want to be ahead of the curve. So we have a product called dispatch for example which is um essentially an autonomous power station for unmanned systems. You know the drone market is like proliferating and drone dominance is a huge program in department of war but you can't extend autonomy if you still have personnel in the way that are powering your systems. And so this is like a docking station just like you would like charge your iPhone from for anything on the blue UAS list. And like that's a little bit early, but I think like we're going to seize on that because it can be a first mover in that space.

Yeah. How do you think about dualuse technologies? When I look at the legacy primes, almost all of them have wound up at least with some sort of commercial business. Palunteer obviously famous uh Anderal not yet, but I'm hoping for a consumer drone that I can fly around maybe with a camera on it. Uh

they have General Dynamics, they have Gulfream.

[laughter]

Uh and and it sort of just sometimes it just happens over time. Sometimes it feels deliberate and you see it in pitch decks at a seed round where the company says, "Hey, we're going to do this military thing," but then eventually there's this obvious add-on in commercial or oil and gas or something else. Uh do you think that dual use can be a distraction? Do you like thinking about it in the near term? How how are you processing the dual use nature of some of these technologies?

I love this question. I think it's I think it's a distraction honestly like for for Palunteer

it was critical and like really when you think about Foundry and those platforms those are meant to be for like any use case in the world like

you know so the fact that

uh it is dual use makes sense for them but I think today you know traditional venture incentivizes your products to become dual use because that makes you that means your TAM is so much greater and again this is why I think 80% of the government market is like being left untapped. Uh cuz most of the use cases are single use and like honestly that's really critical too and um I think if you your products over time can become dual use even if you are thinking that they have a single-use focus initially. Uh and I think if you start your products in government you have a much greater likelihood of making them dual use for commercial versus vice versa. If you start your product in commercial and you try to move to government, it's incredibly difficult. You know, when you think about compliance, you have to like rearchitect your entire platform for it to become Fed RampI or to meet impact level accreditation status. So, um I'd much rather see our products if they like they don't have to become dual use. They can be single use and I think the government needs single-use products, but many of them are already dual use. You know, some of our initial buyers were actually commercial customers and like that's valuable too because it establishes commerciality, but it has to be focused like your first customers have to be in government uh in our in our ecosystem and um I just think dual use is way overhyped.

Talk about the fundraising strategy to date. Yeah. So, my seed round uh was myself, Trace Stevens at Founders Fund, Paul Quan at General Catalyst, and Grant for Standig at Red Partners. All of which I like deeply trusted or I never would have done this. Like I'm a little bit of a unique founder, mom of two. Uh you don't see a lot of defense tech women founders. Um but um I like that. Uh, [laughter] but you know, I Trey and and Paul and Grant were people I deeply trusted when we started this process and they've been incredibly supportive of this journey.

Um, and I think they recognize the need for a new model in this space. And so, as we've continued our kind of fundraising strategy, it was important to me at the A that we brought in Colin um, and kind of friends and family capital. You know, he's OG Palunteer CFO.

Yeah.

Seen what it's like to build a generational defense tech company from the inside. someone I deeply trust. We were executives there together and I also think they're brilliant capital allocators and at the end of the day we fund our companies. We are a capital allocation machine.

That's great.

Um and so they've been an awesome partner.

Congratulations on all

we got a gong. We we got a hit for you.

Thank you so much for coming on the show today. Hope you rest week again soon. I'm sure there'll be plenty of news to discuss.

Sounds great.

Cheers, Julie. Talk to you soon.

Goodbye.

Next up, we have our Lambda Lightning round. We got Winston Weinberg, co-founder of Harvey. Look at this thing.

Oh, I like [laughter] the sound of that.

Good job.