Your Guide To AI And PLG

Kyle Poyar

Kyle Poyar

November 15, 2022

Jasper’s jaw-dropping Series A $125 million fundraise—at a $1.5B valuation, seemingly out of nowhere—woke many of us up to the disruptive power of AI in reshaping software.

Jasper describes itself as the “No. 1 AI content” platform, which can be used to create art, emails, ad copy, social media posts, and even blog posts. Here are some quick facts:

  • Based in Austin, Texas
  • Expects to generate $75 million in revenue in 2022
  • 2x revenue growth YoY
  • More than 80,000 customers
  • Announced the acquisition of Outwrite, a grammar checker with 1 million+ users

Now I can’t stop thinking about how AI changes what we believe to be true about how software companies grow and monetize. What does product-led growth mean in the age of generative AI? How do you convince folks to try a product that they fear could take their job someday? How should AI products be priced?

To help unpack these questions, I turned to Jasper’s Head of Marketing, Meghan Keaney Anderson. We discussed how Jasper stands out in the increasingly crowded generative AI market, how Jasper educates customers to try an entirely new way of operating, and the role of community-led growth in Jasper’s PLG strategy.

A quick detour: am I an AI nerd now?

Before I jump into the conversation with Meghan, I wanted to share more about my personal experience with generative AI products.

I took one of the newest AI darlings, Astria, out for a spin and fell hard down the AI rabbit hole. Astria—which recently debuted on Product Hunt—lets folks generate AI art from their own images, like the Picasso-inspired headshot below.

An AI-generated image of a blond-haired man with glasses and a blue jacket with an abstract picasso-esque background.

Here are my initial takeaways.

👉 You get *some* value right out of the gate. It feels like magic 🪄

But the initial value probably isn’t what you’re looking for. I tried out more than a half dozen different prompts before I got anything back that was halfway decent. Some results were…questionable. (I’ll spare you from those.)

The real benefit came from testing prompts and seeking out inspiration from others via Lexica, the stable diffusion search engine. I ultimately tried about 20 different prompts in total and sorted through over a hundred separate images to handpick the best one. In other words, humans still play an important role working with AI.

👉 You turn to the community for inspiration, education, and support.

I craved the connection with others to see what they built and how they might help troubleshoot my failed prompts.

Software companies used to differentiate on the basis of product features. With AI products, it’s safe to say that community is becoming the new moat (along with proprietary data). More robust communities draw in new users, ensure those users are equipped for success, and thereby fuel even more product adoption.

👉 You want to *show off* what you’ve built, like I’m doing now 😉

It feels inevitable that creators and influencers on platforms like TikTok, Instagram, and YouTube will be a huge part of how AI companies reach their target audiences and grow their user bases.

The only caveat: creators will only want to share when they’ve been successful and made something of value. A strong product and community becomes fuel for social media virality.

👉 You might build something cool, but will you come back to the product again and again?

Today products like Astria are a destination you have to seek out, meaning that usage will probably be one-off, episodic, or project-based. I’m excited about AI being embedded into existing software and workflows where folks already live/work.

Jasper, for example, makes a popular Chrome extension to bring AI into users’ content workflow—whether that’s in Gmail, Docs, HubSpot, Notion, Salesforce, or nearly anywhere else.

👉 Usage-based pricing makes sense for products like these, but we still have work to do to monetize AI products.

Astria, for example, charges for a “token” that lets you batch upload images as a source for generative art. Jasper’s pricing is a credits model based on the number of words written. Writing 35,000 words only costs $40 per month—a bargain relative to the amount of time required to write manually.

Inside Jasper’s 🚀 growth story

With new AI products being released nearly every day, I asked Meghan: what makes Jasper different?

She acknowledged that we’re heading for a time when AI will be ubiquitous. But she was quick to highlight that “being widely available and actually usable to achieve business outcomes are two very different things.”

Jasper was an early adopter in focusing on generative AI specific to businesses and professional content creators. They’ve gone hard after that market with the thesis that whoever has the most data, the most feedback, and the most active community can build a moat that others won’t be able to beat.

“Because our founders are marketers by trade, Jasper deeply understands the pain and has always built with the customer at the center of all decision making,” said Meghan. “Jasper has helped to build the market, educate people on how to incorporate it into their workflows, and built in tools to make Jasper practical (like a plagiarism and grammar checker).”

The other point of difference is that Jasper’s product combines writing and art, with the belief that customers will prefer a one-stop shop when producing content for different business use cases. The more jobs that Jasper can take on for a customer, the more frequently customers will come back to it and the stickier the product will be. (With usage-based pricing, Jasper can also monetize this increased usage.)

How Jasper educates users to explore AI for the first time

Meghan pointed out that despite the buzz around AI in tech circles, most folks are exploring AI for the first time. Jasper’s challenges involve “educating the market that this kind of technology exists, making it incredibly simple for customers to find real value upon first use, and ensuring they understand why partnering with AI in the long term will make them more efficient.”

That’s no easy feat. Yet Jasper has clearly mastered it; their customer count has reached 80,000 in less than two years after launching.

Jasper looks at its customers in two segments: prosumers and enterprise customers. There’s overlap, of course, as prosumers try Jasper and then bring it to their teams (#PLG).

Prosumer acquisition comes from paid social media (which you will start to notice once you visit their website!), affiliate marketing, and word of mouth. While I tend to be averse to throwing money at paid ads, it fits into Jasper’s flywheel of attracting the most customers in order to build the strongest moat. And advertising on consumer social media channels—such as Instagram— tend to be less expensive than Google Search or traditional B2B marketing.

This brings up the question: will AI companies need to outspend their competitors on marketing in order to win in the market?

Once Jasper acquires a prosumer user, they want to make the product as easy to use as possible. Jasper has a free trial that allows folks to generate whatever content they want—and then “that magic moment is instantaneous” according to Meghan. There’s fast time to value and then there’s instant value, made possible by AI.

From there Jasper invests in teaching folks how to use AI and integrate it in their writing process. The company does that through Jasper Academy, the Jasper Bootcamp training, and inviting users to join the #JasperNation community.

While Jasper hasn’t had a concentrated company effort around organic social channels like TikTok—at least not yet—Meghan told me that users have regularly taken to posting about how they use both Jasper and Jasper Art. This is a space to watch going forward.

Community-led growth at Jasper

AI helps free people up from mundane or manual tasks. With that extra time, folks can get creative about the best ways to use AI to achieve their goals. This is where community comes into play.

Meghan highlighted that “community is massively important for emerging categories like generative AI because of the power of the feedback loop.” Through community discussion and shared discoveries of individual users, Jasper finds new ways to integrate AI into the enterprise and double down on the most practical AI applications (rather than anything nefarious or unethical, which could erode users’ trust).

In Meghan’s words, “community helps people see the reality of AI as a practical tool that can make people’s work easier and free them up for the very human roles of originating ideas, conducting research, and infusing content with lived experience.”

Jasper believes so strongly in community that they actually embed #JasperNation in a featured spot right in their product dashboard. They also launch new features into their community before making a big public splash.

“We hear excitement, complaints, questions, and ideas from our community,” Meghan explained. “All these things invigorate us and are funneled into how we build and market the company.”

Who would’ve thought an AI company would be so…human?

Kyle Poyar

Kyle Poyar

Partner at OpenView

Kyle helps OpenView’s portfolio companies accelerate top-line growth through segmentation, value proposition, packaging & pricing, customer insights, channel partner programs, new market entry and go-to-market strategy.