In 1971, Paulsen performed in the play "Play It Again, Sam" at Cherry County Playhouse in Traverse City, Michigan. He enjoyed this professional summer-stock theater so much that he became business partners in 1976 with television writer and producer Neil Rosen and bought Cherry County Playhouse. He starred in a production every summer except 1973, all the way through the 1995 season. He starred in 24 different plays, including "The Fantasticks", "The Odd Couple", "Harvey", and "The Sunshine Boys". He appeared in nightclubs, theaters, and conventions throughout the country. In 1984, he co-starred in the film "Night Patrol", a vehicle for The Unknown Comic.