Matt Rice, Partner, Ballast Point Partners

In an interview with Invest:, Matt Rice, partner at Ballast Point Partners, discussed the firm’s rebrand, the evolving role of AI in healthcare and technology investments, and Tampa Bay’s business ecosystem. “The openness of the business community is really something that’s unique,” Rice said.

What have been the most significant changes for the firm over the past year?

We are in the final stages of deploying our fourth fund, a $190 million vehicle. We make minority growth equity investments across healthcare, software and technology-enabled services businesses.

Over the past 12 months, we have generated several exits across our recent funds — a meaningful distinction at a time when capital distributions across the private markets have been constrained. 

We also rebranded from Ballast Point Ventures to Ballast Point Partners. The “Ventures” label carries associations with high-risk, high-loss investing that simply does not describe what we do. We have maintained a very low loss ratio across our recent funds — generating strong returns through investment discipline, not by swinging for the fences. The new name more accurately signals our growth equity identity.

How would you describe the current investment environment for healthcare and technology companies?

The central theme is artificial intelligence. Every company presenting to us is trying to position itself as either insulated from AI risk or benefiting from AI as a tailwind. Our job is to evaluate whether those claims are truly defensible.

The challenge is that the space is changing incredibly quickly. One advantage of our strategy is diversification. About 40% of our portfolio is healthcare, while 60% is software and tech-enabled services.

That diversification matters because some sectors are more exposed to AI-related disruption than others. Healthcare is generally viewed as more insulated than enterprise software for example, so having exposure across multiple industries helps balance risk.

Which technologies are genuinely transforming operations today?

On the healthcare side, we are seeing the greatest impact in technology-enabled services businesses. Many healthcare workflows involve clinical expertise, compliance, and regulatory oversight. AI can help automate portions of those workflows and improve efficiency.

The primary benefit we are seeing is not headcount reduction — it is the ability to scale revenue without scaling costs at the same rate. Many of our portfolio companies are growing 25% to 30% annually, and AI is enabling their teams to absorb that growth without proportional headcount additions.

That creates stronger capital efficiency, which is a core focus for us. Our strategy is fundamentally different from the traditional venture model, which accepts sustained losses in exchange for hypergrowth. We invest in companies that are already generating revenue with proven business models, and we prefer businesses that can grow efficiently without continuously burning investor capital.

How are healthcare providers and operators adapting to current pressures?

The most pressing challenge is managing internal uncertainty around AI adoption. Within any organization, you will find employees who lean into it and those who resist because they are concerned about displacement.

That dynamic is still playing out across many businesses. Companies are trying to determine how AI will affect different roles and how aggressively to adopt it. Some employees are hesitant because they assume their positions may eventually be replaced.

From an investment standpoint, the management teams that handle the transition thoughtfully — communicating clearly, upskilling where possible, and deploying AI in ways that augment rather than simply eliminate roles — are the ones we believe will build more durable organizations.

What advantages does Tampa Bay offer entrepreneurs and investors?

One major advantage is that Tampa Bay is not dependent on one single industry or vertical. The market has diversified significantly over the last 20 years.

Historically, Tampa had strong concentrations in hospitality, real estate, and call centers, but today the economy is much broader. You see that both through company relocations and new business formation.

Following the pandemic, many entrepreneurs and operators relocated to Tampa for lifestyle reasons or because remote work gave them more flexibility. Many of those people stayed, started businesses, and contributed to the ecosystem. That influx of talent has meaningfully accelerated the depth and quality of Tampa’s entrepreneurial ecosystem.

How would you describe Tampa Bay’s business community?

I have always thought Tampa offers the best of both worlds. It is still small enough to maintain a close business community where people are willing to make introductions and explore opportunities, but it also has the infrastructure and amenities of a much larger city.

You have strong schools, professional sports teams, a great airport, and significantly improved infrastructure compared to 20 years ago. While growth has also created challenges like traffic, overall it has been very positive for the region.

How important are relationships and local engagement in your investment philosophy?

It is critical because we are fundamentally investing in people. We make minority equity investments, so alignment with our entrepreneur partners is extremely important.

Our network helps us identify opportunities, recruit operators, and support portfolio companies. That network effect is particularly strong in Tampa.

Many people relocated here from other markets, and there is a strong pay-it-forward mentality. People remember when they first arrived and others took the time to meet with them and help them build relationships.

The openness of the business community is really something that’s unique here.

How will investors and operators need to evolve in the coming years?

You cannot answer that question without talking about AI. Leaders do not necessarily need to become experts, but they do need to understand the implications of these technologies and how they will affect teams and operations.

The traditional playbook used in growth equity or private equity 10 or 15 years ago is not necessarily sufficient anymore because business models are changing so rapidly.

Adaptability will continue to be critical, especially during a period of major technological transformation like the one we are experiencing now.

What are the firm’s priorities moving forward?

We are focused on continuing to evolve our strategy while also developing our team and growing the firm.

We recently launched the fundraise for Fund V, and we still have investments to make from Fund IV. Capital formation and capital deployment run in parallel in this business — you have to continue building LP relationships even while you are actively investing. And we all have existing portfolio companies we’re working closely with on a regular basis. Helping entrepreneurs build businesses and realize their dreams is by far the most important and rewarding part of our job.