How Jasper became the fastest-growing marketing tool by finding Founder-Market Fit

How Jasper won AI content marketing by being the right Founders to solve the problem:

A lot is said for PMF (Product-Market Fit). And rightfully so.

PMF wins because you feel the market pulling your product. You aren’t constantly trying to fit it in somewhere.

But what is less spoken about is Founder-Market Fit (FMF). And again, there’s probably a good reason for that. FMF isn’t vital for success. But it’s like cutting the difficulty setting in half.

It’s something I spoke about in part 3 of the Arc deep dive, but FMF gives you this intuitive and deep understanding of your customers.

You know what they want and how they want it.

It helps you cut through what customers say, and translate to what it actually means.

Dave, JP, and Chris were the right people to solve this problem.

And because of this, they saw the problem before anyone else. And commercialized it before anyone else.

🔬 How this looks practically:

3 actionable insights to build and leverage FMF.

🪜 1. Stacking wins

Jasper isn’t Dave, JP, and Chris’s first soiree into marketing.

Far from it.

12 years ago they came together with a goal. Not to change the world or to build the next Facebook. But to build a business that makes $6k/month so they could each support their families and not have to work a traditional job.

Think they might have slightly overachieved this by now 🤣

Their first step?

A marketing agency that did paid ads (Google and Facebook) for local businesses.

They scaled this business to ~$20k/month before realizing they wanted to try something new.

They were tired of the difficulties of the agency business and struggled to picture their path to scaling it.

But they didn’t leave empty-handed. They left with their first important wins:

• Momentum (it’s important to get a small quick win to get you going)

• Fundamentals of marketing (particularly paid ads)

• How to sell

Instead of trying something completely new, they productized what they knew and started selling it as a course - i.e. teaching other people how to do it.

After running it for a while though, they were running into the same concerns. They weren’t clear on how they would scale it.

It was also around this time that they built a tool to help their customers with sales conversions:

Proof.

Which showed a pop up that “X has just bought this” on a sales page, boosting trust and increasing conversion rates through you guessed it, social proof.

Dave took it to the course members who were keen to try it out and willing to pay even though the product hadn’t launched yet.

In fact, they made $80k from presales.

They knew they were onto something here. And so decided to go for it: Applying and getting into YC.

Importantly, they didn’t leave the course business empty-handed. They continued to build on their marketing ladder:

• Marketing their own product

• Selling a product and not a service

• Building community

They used all of this to scale Proof to ~$2M ARR.

But they still weren’t sure if they had found PMF.

They were making a lot of money. But were burning even more.

And the thing with PMF is if you’re not sure you have it. You probably don’t.

But then Dave had an idea:

Being part of YC they could get early access to OpenAI. He wanted to use this model to help people with performance marketing. Reducing the time required, scaling volume, and increasing results.

So again, he jumped on some calls with their current users and did some live demos.

And then it clicked.

Proof did not have PMF.

They had been building for years and had never had users jumping at them and begging them to use it like they were for this new AI tool.

And now they were on the final step of their ladder. Having built-up wins (even though Dave refers to them as “failures”) that sequentially built on their knowledge and skills. And made them the perfect people to take on the problem Jasper was solving.

Helping marketers create better content, quicker.

🌍️ 2. Distribution advantage

It’s no secret that products are becoming less differentiated. Especially AI products.

The barrier to entry has never been lower to build an awesome tech product.

Nor has it ever been as popular.

Because of this, distribution has become even more important. In a sea of products that all look similar, those who can get theirs into the hands of users will be the ones that win.

Lenny Rachitsky did an awesome job of listing out 7 different ways to own a distribution advantage:

1. Starting with a pre-existing audience

2. Developing a unique viral loop

3. Being first on an emerging platform

4. Having a remarkable story

5. Starting with pre-existing strategic relationships

6. Closing early strategic partnerships

7. Bringing extraordinary hustle

Jasper? They have 6 of them. Possibly even all of them.

1. Pre-existing audience: They had 6 years of building up a client base of marketers, many of which were currently enrolled in courses they were running. This gave Jasper a pre-made starting point when launching.

2. Viral loop: This will be covered more in next week’s episode, but to sum it up: the more users Jasper gets, the more data they collect, which means the better they can fine tune their model, which leads to better results. And ultimately more customers. And so the loop continues.

3. First on an emerging platform: Jasper were one of, if not, the first to build on Open AI’s model for a marketing-specific use case. Before GPT-3 was ever released to the public. So when it did launch, they were there to capitalize on it.

4. Remarkable story: 3 friends who want nothing but to support their families while running a business together? Personable. 3 successes and 3 pivots later? Remarkable.

5. Pre-existing strategic relationships: This is the one I’m not 100% sold on. They were in YC, so had a connection (not quite partnerships) with the YC network. You be the judge if this deserves to be here!

6. Early strategic partnerships: Getting access to OpenAI before its public launch safely ticks this box.

7. Hustle: Once again, not much to say other than 3 successes and 3 pivots. They know how to find customers, close them, and deliver.

Because of this, Jasper was able to get in front of the right people before anyone else. And cheaper than anyone who doesn’t check these boxes.

👨‍🔬 3. Domain expertise

Okay. So Jasper were able to get in front of their ideal users before anyone else.

But what about once they got there? How did they keep them?

Simply put, by understanding their problem, solution, and user base better than anyone else.

Dave and the team had become experts in marketing. They had 12 years of experience in it at different levels and use cases.

They knew what good looked like. And they knew what shit looked like.

This is always important in business. But even more so in AI.

Why?

Because you want to be able to fine tune the model you’re using to solve your unique use case better than its general application would.

Because of this they could make their users more successful than any other AI product could.

And this experience also positioned them as experts. Potential customers were more willing to give them blind trust. They didn’t need to prove as much.

Because they already had.

Additionally they could understand what their users wanted to achieve with Jasper and how they wanted that process to look.

They could develop domain specific workflows to achieve extremely specific use cases.

This became an extremely important part of how Jasper rushed to the lead to win the content marketing AI category and how they stayed here by creating an approachable interface on top of OpenAI.

But we’re getting ahead of ourselves.

So tune in next time to The Zero to One. Same place, Same time. Next week.

It’s been your host,

Sheldon

My picks to take your business to the moon 📽️

• How to find more customers on LinkedIn (link)

• How Morning Brew grew from $0 to $400k in one year (link)

• Sequoia (Arc) PMF framework (link)