#StartupsEverywhere: Paul Ehlinger, Co-Founder, Flamel.ai
This profile is part of #StartupsEverywhere, an ongoing series highlighting startup leaders in ecosystems across the country. This interview has been edited for length, content, and clarity.
Transforming marketing for multi-location brands
Founded in 2022, Flamel.ai helps multi-location and franchise brands stay true to their brand guide while delivering content at scale. With a background in venture capital, co-founder Paul Ehlinger is a seasoned expert on issues facing startups today. We sat with Paul to discuss AI, open source, and more.
Tell us about your background. What led you to Flamel.ai?
Flamel.AI is the third company I’ve helped build. Before that, I managed the state of Kentucky’s venture capital (VC) fund, was a principal investor at a larger private fund, and founded my fund called Sixty8 Capital. I’ve been in the innovation ecosystem for my entire career.
I started Flamel for two key reasons. First, I wanted to explore the generative AI space—three years ago—when it was still relatively new. It was the perfect opportunity to experiment, make mistakes, and learn while working with cutting-edge technologies.
Second, my inspiration came from my wife, who runs a local clinical psychology practice. Watching her struggle to create content with the tools available motivated me to develop something better.
I realized there was an opportunity to build technology for small businesses' local marketing needs. We've refined the focus a bit now, serving exclusively to multi-location brands with their unique challenges and struggles.
What is the work you all are doing at Flamel.ai?
We built our tech to solve marketing problems for multi-location franchises, places with over 200 locations like gyms or home services. There is a big national marketing brand and strategy that local locations follow. Many local locations don’t follow the guide enough or if they do, it's probably not great — it isn’t on brand or doesn’t follow the tone of voice the national offices want them to use.
With our system, we learn the national brand and enable the national team to share ideas, resources, and tools with local locations, easing the implementation of marketing strategies. For example, if local franchises were told to make a social campaign, now all they have to do is take a picture of this, put it here, and the software will do everything else. We started in organic social and are expanding to more marketing channels to become the marketing operating system for multi-location brands.
How have you approached AI development? What role has open source played?
In the AI space, everything's moving so fast. Our unique sauce is the multi-location issue, as there are very few companies building AI agents within that specific space. We don't try to go one way or the other. We don't have the funding to compete on the foundational model level and we don't necessarily want to. What we can compete on is understanding the value proposition of our customers the best.
We use open-source models for the broad LLM needs we have. Then, we build a couple of custom models on our end to add to the foundation model. We can fine-tune models locally based on the brand through data siloing. Only users that are part of the organization can access the data and model, and we don’t cross-train the data against other models.
There are many court cases across the country litigating the question as to whether AI models can use copyrighted content in training data. What barriers would your company face if you are confronted with a similar infringement claim?
Simply put, we don’t have the funds and time to defend against possible copyright infringement lawsuits. Larger AI companies with similar services have the time and money to defend themselves in these defining court cases. We have to hope that these questions are resolved by the ongoing litigation and we don’t have to face a lawsuit.
We set our service’s terms and conditions as best we can given the current litigation around AI and copyright, but the laws and technology are constantly evolving. At the end of the day, the possibility of a copyright lawsuit over how customers use our AI poses a regulatory risk to our business model, but we have to operate under the pretense that we can’t solve that issue today with our limited resources.
You mentioned your previous work in the funding space. Based on your experience, what recurring issues did you see concerning capital access and what ideas do you have to address it?
I took a job with the state of Kentucky, managing their fund and supporting other entrepreneurs. This fund operates as a yearly budget line item, where they allocate funding to specific types of companies outlined in the legislation. Around the same time, I launched Sixty8 Capital, a $20 million pre-seed fund still active today, focused on supporting underrepresented entrepreneurs. Female, Black, and Brown founders often face systemic challenges, and many don’t have the resources to reinvest in others. The lack of an ecosystem of support inspired me to work toward changing that.
I think I have an unfair advantage coming from a career in venture capital. I wouldn't be able to start companies like I do today if I didn't meet all these people, work with them, and make money for them. It's probably why I can do what I do out here today. I try to pay it back by being willing to connect everybody to anybody I've ever raised money from or worked with.
One thing we need to pursue is creating more angel investors. There is an information gap because a lot of the money out there [in the Midwest] was made in old industries. These investors are not used to the idea of making money from technology companies and many don’t even know that it is an option.
What role can state and federal governments play in economic development to benefit the startup ecosystem?
One of the things I always think about is continuity of resource access—at the state level especially, and then at the federal level as well. A lot of initiatives to help startups are based on these weird budgets that are on an annual or three-year basis, and sometimes those just go away.
Historically economic development has been tied to administrations. When it comes to innovation and entrepreneurship, especially if the goal is to build an ecosystem, it can’t be tied to an administration. It needs to be tied to the idea that it needs to exist regardless. Then, there needs to be ways to incentivize people to invest in the startup ecosystem, for example, by offering Angel tax credits.
Are there any local, state, or federal startup issues that you think should receive more attention from policymakers?
The urban-rural divide. All of the venture funding in the state of Kentucky goes to the cities — Louisville, Lexington, and Covington. But there are still companies coming out of the rural areas, wanting to scale but unable to get funding.
The same divide applies also with broadband access, especially in Eastern Kentucky. Policymakers need to find solutions to the digital divide to ensure that the entire startup ecosystem can innovate and grow with reliable, high-speed Internet.
All of the information in this profile was accurate at the date and time of publication.
Engine works to ensure that policymakers look for insight from the startup ecosystem when they are considering programs and legislation that affect entrepreneurs. Together, our voice is louder and more effective. Many of our lawmakers do not have first-hand experience with the country's thriving startup ecosystem, so it’s our job to amplify that perspective. To nominate a person, company, or organization to be featured in our #StartupsEverywhere series, email advocacy@engine.is.
