Artisan's Bold Bet: Why This AI Startup Still Believes in Human Talent Even After Raising $25M

It’s been a challenging yet thrilling year for 23-year-old Jaspar Carmichael-Jack, the founder and CEO of AI sales agent startup Artisan. Recently, Artisan secured a $25 million Series A funding round, led by Glade Brook Capital, with participation from notable investors like Y Combinator, Day One Ventures, and HubSpot Ventures.

The Journey So Far

A year ago, Artisan emerged as a top startup from the winter 2024 Y Combinator class, having raised $12 million in September. The journey has not been without its chaos, as Carmichael-Jack and co-founder Sam Stallings navigated the tumultuous waters of early-stage startup life.

Artisan operates in the rapidly expanding AI sales development representative (AI SDR) market. The company gained significant attention through its controversial “Stop Hiring Humans” marketing campaign, which sparked various reactions, including some backlash. In a lighthearted twist, Carmichael-Jack even staged an April Fools' joke about stepping down as CEO—proclaiming an “AI CEO” would take his place.

AI vs. Human Workers

Despite the provocative marketing, Carmichael-Jack clarified that he does not genuinely believe AI will completely replace human workers. He remarked, “Human labor becomes more valuable when you have AI content.” Currently, Artisan employs 35 humans and is actively seeking 22 more, including sales roles. They also recently appointed a new CTO, Ming Li, with a rich background from Deel, Rippling, TikTok, and Google.

Addressing Customer Churn

Carmichael-Jack acknowledged that Artisan, like many AI SDR startups, has faced customer churn. While AI agents are designed to automate cold outreach, the industry is still maturing, with many products struggling to deliver results. He noted that early versions of Artisan's product suffered from poor performance, describing them as having “extremely bad hallucinations.”

However, Artisan has made significant improvements. Their flagship product, Ava, reportedly only experiences a 1 in 10,000 error rate now. By collaborating closely with model provider Anthropic, Artisan developed tighter prompts that minimize errors.

Today, Artisan boasts 250 customers and has achieved $5 million in annual recurring revenue. The company is also set to launch two new products: Aaron, for managing inbound messages, and Aria, a meeting management assistant, both expected by the end of 2025.

Targeting the Right Customers

Carmichael-Jack shared insights on customer targeting, indicating that not every company is suited for AI SDR solutions. Artisan has opted out of working with certain industries where they found clients struggling to generate quality leads. They offer flexible contracts that allow clients to exit if they are not satisfied with the service.

He emphasized the importance of qualifying customers, stating that successful clients typically achieve around a 1% response rate. To enhance targeting, Artisan is incorporating data signals from social media and news to refine their outreach strategies.

Carmichael-Jack believes their proprietary database of brick-and-mortar businesses gives them a competitive edge, and they are piloting a new success-based pricing model with Paid.ai, allowing customers to pay based on performance rather than committing to long-term contracts.

“We should only sell to those who derive value from our product,” he stated, highlighting their commitment to customer satisfaction.