Has the fundraising pitch process changed?

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What if the future of startups isn’t decided by who builds the flashiest AI, but by who solves the right problems?



In this episode, I’m joined again by my friend Thorgeir Einarsson, almost a year since we last spoke, to unpack how AI funding and investor expectations have shifted from hype cycles to hard realities. Thor runs PGO, a service that helps founders get truly investment-ready with real pre-diligence instead of lipstick on a pig.

Pre-seed and seed are brutal right now, and traction beats vibes. Investors are placing smaller, option-like bets at the AI application layer while steering clear of generic models. Hardware is back where it matters, from defense tech to medical devices, when firmware and software meet close to the metal. We trace the PE-ification of VC: rolling up vertical SaaS, “AI-firing” them, and rebuilding moats from customer bases and domain data. Thor flags a blind spot worth building for: AI safety and guardrails for agentic workflows. Then we get practical: preparation beats performative decks, checklist-driven pre-diligence forces the hard questions, and the playbook is simple… know yourself, know your co-founders, keep investors updated, and track the numbers.

You’ll Learn:

• The reason many VCs focus on the AI application layer
• What happens when nobody knows what a great AI company looks like yet
• The link between defense and medical devices and hardware-plus-software products
• The damage of skipping investor updates and simple monthly KPIs
• What it feels like to raise when only one to three percent get a check
• The reason pre-diligence and checklists come before the pitch
• What happens when agentic workflows scale without safety guardrails

Timestamps:

[00:00] Introduction

[05:42] Why AI investment has shifted from hype to hard reality

[12:18] The brutal truth about pre-seed and seed fundraising in 2025

[18:33] Why investors are betting smaller at the AI application layer

[25:47] How defense tech and medical devices are bringing hardware back

[32:11] The rise of “AI-firing” old SaaS companies and the PE-ification of VC

[40:26] The missed opportunity in AI safety and agentic workflow guardrails

[48:59] How founders can prepare for due diligence the right way

[56:22] Why investor updates and clear KPIs determine long-term trust

Connect more with Thorgeir on LinkedIn.

Find more from Adam on LinkedIn and YouTube, and check out Adam's CTO coaching company here.