An “AI content” platform being developed by a startup named Jasper has raised $125 million at a $1.5 billion valuation. Interestingly, the tranche is the company’s first and it occurs as Jasper is buying grammar and style checker and AI firm Outwrite, which has more than a million customers worldwide.
According to CEO Dave Rogenmoser, the money will be used to develop Jasper’s core products, enhance the user experience, and expand the use of Jasper’s technology in apps. It will also support Jasper’s ongoing efforts to merge the Outwrite brand under its own, he said, and unify the two companies’ offerings in 2023. Led by Insight Partners with participation from Bessemer Venture Partners, IVP, Foundation Capital, Founders Circle Capital, Coatue, and HubSpot Ventures, it will be done so under the leadership of Insight Partners.
Rogenmoser stated, “to establish a market-leading company in generative AI we need the necessary infrastructure – that’s what we’ll raise [additional] financing for.” “We want to create a world-class company, and to do so, we want capital and extremely valuable partners.”
Early last year, Rogenmoser founded Jasper with the help of Chris Hull and J.P. Morgan, who together largely bootstrapped the business. Rogenmoser graduated from Y Combinator, and he co-founded Proof, a company that employed algorithms to tailor websites for companies. With experience in process automation and business-to-business marketing, Morgan and Hull also assisted in the co-launch of Proof, whose technology served as the foundation for Jasper.
As a marketer by profession, Rogenmoser stated, “I’ve always been fascinated by AI and saw how it was evolving from theory and academics into a disruptive, applied technology that might help people.” “With the introduction of [OpenAI’s] GPT-3, we saw an opportunity to introduce an AI content platform that might aid enterprises and professional producers in brainstorming and carrying out their job more effectively.”
Jasper uses AI to produce content for website copy, social media postings, blog posts, and more. Customers may use the platform to define in natural language what they want Jasper to write, whether it’s a keyword-rich article intended to rank highly in search engines or already published content that has been given new context.
Many startups, like Copy.ai, WriteSonic, Peppertype, Wordtune, and Simplified, to mention a few, also engage in this. A recent study by TechCrunch found that the market for AI-driven, copy-generating adtech suppliers is thriving. For its platform for creating content using AI, Copysmith received $10 million in funding in April, and Copy.ai closed a $10 million round in October.
Jasper’s language models, which Rogenmoser claims were developed for “client specificity” and trained on 10% of the web, are what make it unique. They enable Jasper’s Chrome browser plugin, which provides contextual content recommendations across platforms including Google Docs, Gmail, Notion, and Hubspot, among other apps and services.
The people with the finest feedback loops will succeed at generative AI, he said. Our goal is to create the best feedback for the AI loop possible.
Rogenmoser claims that Jasper Art, a recently released AI art-generating technology, is another way that Jasper stands out. Jasper Art transforms prompts into visuals similarly to systems like DALL-E 2 and allows users to choose elements like the medium (such as “Canvas,” “Pastel”), art style (“Van Gogh”), and mood.
Rogenmoser promotes it as an art-generating system specifically created for marketing applications, such as developing copyright-free stock images, even though there are a variety of free and paid alternatives to Jasper Art (see, for example, Stable Diffusion, Pixelz.ai, and Midjourney). Jasper Art is being used by one early adopter, Mongoose Media, to produce flat lays and backgrounds for its designers around product photographs, according to him.
Jasper Art has limits much like other AI text-to-image systems, of course. The system, which has a content filter to try to detect “sensitive” or “unsafe” images, such as those depicting violence, may contain biases that cause it to produce images that reinforce negative preconceptions, according to a FAQ on the product page (like CEOs who are mostly white and male).
Customers do not additionally have sole rights to utilize created photographs under the terms of Jasper Art’s license. Everyone is allowed to remix and repurpose the system’s generations, which may be an effort on the part of Jasper to reduce potential intellectual property and fair use issues in the future. Since systems like Jasper frequently use billions of photos from the internet, some of which are protected by copyright, image hosts like Getty Images have decided to forbid AI-generated art.
Rogenmoser admitted that there is “much to be learned” regarding limitations on AI content-generating tools and potential future regulations.
“Ethics concerning data and consumer approval is the biggest difficulty that the AI generation sector faces,” he stated. “While we are always in awe of our technology’s power, we are also acutely aware of the responsibility it bestows upon us. Although we recognize that our control over technology is limited, we are dedicated to continuing to be accountable for its influence.
Despite the difficulties, marketers seem ready to adopt AI technologies for text and picture generation. According to a Phrasee survey from 2021, 63% of marketers would think about spending money on AI to create and improve ad text. Phrasee indeed sells copy-generating software with AI, therefore this conclusion is biased. However, according to vendor-neutral analytics company Statista, 87% of current AI users are already utilizing or are contemplating using AI for sales forecasting and email marketing improvements.
Rogenmoser said that Jasper has over 70,000 clients and made $40 million in revenue last year. With the excitement surrounding AI for adtech and martech, the company anticipates ending 2022 with over double that amount of revenue, or $90 million.
Rogenmoser stated, “We are a hypergrowth firm that is also focused on profitability. “This business has grown faster since the pandemic. AI generation is the obvious choice to support creators and teams as firms explore ways to improve team efficiency.
Insight Partners’ Jeff Horing added “Jasper is positioned to be a platform to alter the way organizations produce content and communicate ideas. It’s not often that you see a shift as significant as generative AI. In such a short period, the company has created a sizable community around AI, and we regularly see new use cases being shared, especially in the workplace. We are forward to working alongside the Jasper team as they develop and broaden their mission.
Image Credit: Jasper