Meet Notion: The All-in-One Productivity and Collaboration Tool for Individuals and Enterprises

Hey Everyone - Harry here 👋

Welcome to Issue #12 of Deep Dive with Inquisition. In this issue, we will cover the story of Notion, one of the most famous software tools for note-taking, team collaboration, and more—from its founding story to the strategies it used to become the company it is today.

Early Days of Notion:

Notion is an “all-in-one” productivity and collaboration software tool designed for individuals, students, and teams of all sizes, from small to enterprise-level. Widely used around the world, Notion operates on macOS, Windows, Android, iOS, and web platforms. Based in San Francisco, California, the company was founded in 2013 by Ivan Zhao and Simon Last.

Overview of the Global Productivity and Collaboration Software Market:

1. The global productivity software market is projected to reach $79.05 billion by 2024.

2. The office software segment within the global productivity market is expected to be valued at $28.63 billion in 2024.

3. Annual revenue growth for the productivity software market is projected to be 2.37%, reaching $88.86 billion by 2029.

4. The global collaboration software market is projected to reach $15.32 billion by 2024.

5. Annual revenue growth for the global collaboration software market is expected to be 1.70%, reaching $16.67 billion by 2029.

6. Major companies in the global productivity and collaboration software market include Google (Google Workspace), Microsoft (Microsoft 365), and Atlassian (Jira and Confluence).

The Rise of Notion: How it was First Started:

Notion was first conceived when Ivan Zhao, Co-Founder and CEO, and Simon Last, Co-Founder, aimed to create a “LEGO of productivity tools”  - allowing non-technical users to customize the platform to their liking without writing a single line of code. The founders secured an initial seed investment of $2 million in 2013 and developed the initial beta of Notion, which functioned as a website builder until 2015. However, Zhao and Last soon realized they were building on the wrong tech stack after encountering frequent crashes and slow performance on the platform.

In 2015, the founders faced a crucial decision about the company's future, with two options available:

1. Lay off the entire team, close down the San Francisco office, and move to a country where the founders do not know the language or culture.

2. Close the company and lay off the entire team.

The founders chose the first option. Ivan borrowed $150,000 from his mother and moved to Kyoto, Japan, despite not knowing the language or culture, hoping to fully focus on rebuilding the product from scratch without distractions. While in Kyoto, Ivan worked on designing the platform, while Simon handled development. Both worked nearly 18 hours a day.

The story truly begins in 2016 when Notion 1.0 was introduced as a flexible platform combining note-taking, tasks, wikis, and databases into one system attracting early adopters and tech-savvy users within the tech ecosystem.

Working in a country where they didn’t speak the language naturally isolated the founders, allowing them to focus entirely on building the product. Zhao and Last launched Notion 1.0 on Product Hunt—a well-known platform for sharing online and physical creations—in 2016. It was a massive success, receiving over 6,500 upvotes and earning the #1 Product of the Week and Month, as well as the 2016 Golden Kitty Award.

How Did Notion Become One of the Fastest-Growing and Largest "All-in-One" Platforms for Productivity and Collaboration?

Startups are never easy, even though they may seem “easy” from the outside. Like many other successful startups, such as Airbnb, Notion went through a rollercoaster of highs and lows, and its growth didn’t take off during its first few years. It took four years after launching its first full product for the company to experience a near-death scenario, its first layoff, and a complete rebuild of the product from scratch. However, explosive growth began when the company launched Notion 2.0, having built its foundation during the initial launch by listening to users’ needs and wants while fostering a community. Notion 2.0 was also launched on Product Hunt, where it received the #1 Product of the Day, Week, and Month, with over 9,000 upvotes. Additionally, the company was featured in The Wall Street Journal with the article titled “The Only App You Need for Work-Life Productivity,” highlighting the product and stating that Notion captures the best of Google Docs, Microsoft Excel, Dropbox, and more.

The founders were specifically obsessed with creating a product that could be used for everything, whether personal or work-related. They aimed to make the platform as clean, minimalistic, and easy to use as possible to appeal to users who don’t know how to code. This realization came when the founders discovered that people don’t want to build apps but instead want tools that help them live more productive and organized lives.

This is why the design of Notion needed to be clean, minimalistic, and easy to use—driving the company to obsess over providing the best possible design and user experience. They achieved this by asking users for feedback, implementing it, and making the platform accessible to a wider audience by launching Windows, Android, and iOS versions after the release of Notion 1.0, while focusing on creating their own community.

By 2019, the company had achieved 1 million total users, launched its ambassador program (the first step toward building the Notion community), and was featured in The Wall Street Journal, along with multiple highlights from Product Hunt. Since its founding, Notion has achieved an estimated 35 million users worldwide, including 4 million paid users, has over 350k followers on the r/notion subreddit, reached a valuation of $10 billion, and fundraised up to the Series C round, with a estimated total fundraising amount of $343.2 million.

Below are the strategies that contribute to Notion’s growth:

1. Build a product so good that people will become its biggest advocates:

   → Notion’s product was so good that its users began creating content explaining the product, showcasing their customizations, and spreading the word within their communities—significantly contributing to the company’s growth.

2. Having a great product design matters a lot:

   → One of the major reasons Notion’s product stood out compared to competitors like Google Workspace, Microsoft 365, and Evernote was its ability to customize everything while maintaining simplicity for those who value minimalism. The minimalistic approach and value stem from the product's design, making the design aspect crucial for any product.

3. Community-led growth works really well:

   → Notion’s community approach was first recognized when the Head of Marketing saw that users had created their own subreddit, r/notion, and were posting content on various social media platforms, including product tutorials, templates, and more. The company identified this and decided to further fuel growth by becoming a community-centered company. They actively listened to users by implementing initiatives such as displaying third-party templates on the platform, hosting and sponsoring events, launching an ambassador program, and offering an official Notion certificate to verify product expertise. All these initiatives have fueled the growth of the Notion community, leading to product-led growth for the company.

4. Make Your Product Accessible to People:

   → Notion follows a freemium model, which allows people to explore its product and use it daily for free, especially since the company provides an unlimited number of pages and blocks for free plan users. However, for those who need to collaborate on a large scale or require additional features, Notion offers different plans to meet the needs and wants of its paid users.

5. Integrate your product into the everyday tools that already exist:

   → Even though Google Drive, Google Sheets, Google Docs, and other Google Workspace tools are direct competitors of Notion, the company has successfully positioned itself as a tool that integrates with everything—from Slack, one of the most widely used messaging tools for teams around the world, to its direct competitor, Google Workspace. This strategy has helped Notion attract more users because, whether you are a small team of three or a large enterprise with 1,000 or more employees, you need various tools for different purposes. Notion facilitates smooth integration with your most-used tools—not by replacing them, but by enabling collaboration through seamless connectivity.

6. You don’t need to reinvent the wheel. Seriously.

   → Notion wasn’t the first company to offer features like notes, wikis, to-do lists, or Kanban boards. It didn’t invent note-taking or to-do lists, yet it managed to change how we take notes, collaborate, manage tasks, and share information by approaching these tasks differently from traditional methods. Notion didn’t reinvent the wheel but viewed it from a new perspective, finding a better way to utilize existing tools. It provided these tools as a product to its target users and consistently met their needs and wants through updates, new feature releases, and, most importantly, by listening to feedback.

Challenges for Notion:

1. Navigating Competition from Existing and Emerging Players:

   → Notion must navigate competition from both established and emerging competitors, such as Google, Microsoft, Evernote, and Obsidian, all of which are major players in the global productivity and collaboration software market. To support ongoing growth, it will be crucial for the company to further scale its community and continue satisfying its current users through regular product updates.

2. Increasing the Number of Paid Users:

   → As you know, Notion operates on a freemium model, generating revenue from its paid users. According to CNBC, Notion is estimated to have around 4 million paid users out of a total of 30 million users worldwide, meaning approximately 13% of its customers are paid users. This is an impressive figure for a company like Notion. However, navigating the crowded market while scaling both the total number of users and the number of paid users will remain a challenge.

Future of Notion:

1. Continuing Its Global Expansion:

   → In recent years, Notion has expanded into global markets by offering region-specific languages, providing templates from both the company and independent contributors, and introducing ambassador and community leader programs. These initiatives have not only facilitated successful launches in various countries but also helped build communities tailored to specific regions. To sustain its global expansion, it will be crucial for the company to continue offering diverse language options for its platform and templates while also building region-specific communities to establish a strong foundation and support further growth.

2. Expanding its toolset through active mergers and acquisitions (M&A):

   → Since Notion positions itself as an “All-in-One” platform, it needs a variety of tools beyond those currently available on the platform. For example, Notion recently introduced new features such as “Calendar,” “Charts,” and “Forms.” Although these features are already present in many of its competitors and indirect competitors, Notion released them in response to user demand and to further its goal of becoming a true “All-in-One” platform. For instance, to launch “Notion Calendar,” the company acquired Cron in a 8 - figure sum in order to expand into the calendar market. We can expect more features that blend existing tools with Notion’s design to be added to the platform, either developed in-house or acquired through mergers and acquisitions of other companies that align with its competitive strategy.

3. Notion x Open AI X Anthropic = Notion AI:

   → It’s clear that AI is the future, and companies are increasingly looking to integrate AI into their products and services. Notion is no exception; it has also found a way to incorporate AI into its platform. The company aims to further solidify its position as the “All-in-One” workspace by leveraging AI to enable users to ask questions and perform various tasks. The development of Notion AI will be crucial for the company’s growth, as AI capabilities continue to advance rapidly. By implementing and refining AI features, Notion can enhance user experience, potentially leading to higher satisfaction and attracting new users.

Below is the official link to the explanation of Notion AI from Notion.

Key Takeaways from the Story of Notion:

Many founders believe that you need to reinvent something as a startup to become “big.” However, the truth is that you don’t always need to create something entirely new. Instead, you can provide a better solution for an existing problem that already has many solutions.

This is the story of Notion — a comprehensive workspace platform that addresses challenges in the productivity and collaboration market by offering a solution that meets the needs of its target users. While many features of Notion are already available in other solutions, the key difference lies in its unique approach. A simple tool that allows for flexible customization based on specific user preferences was one of the main factors in Notion’s success.

The journey was not smooth for Notion, especially in its early days. The company nearly failed due to insufficient funds and the need to rebuild and redesign everything from scratch after choosing the wrong tech stack. It was challenging from Day #1. Even after raising millions of dollars, competing against giants like Google and Microsoft, as well as emerging competitors like Obsidian, remains a major challenge. Startups are like running a long marathon, and every founder has a story to share, whether good or bad.

Several factors contributed to Notion’s success. Key elements include its simple design that allows infinite customization based on user needs, the development of a strong community that fosters direct contributions (e.g., users creating and monetizing Notion templates), and seamless integration with popular tools for both individuals and enterprises. The story of Notion exemplifies that in entrepreneurship, the journey is a long marathon rather than a short sprint, and it is crucial for entrepreneurs to persevere, as the founders of Notion did. Notion’s success stems from its customizable design, strong community, and smooth integration with other tools used by both individuals and enterprises.

Below are the key strategies Notion used to become the company it is today:

1. Entrepreneurship is about surviving and navigating through the noise:

   → Notion almost failed due to a lack of cash and the choice of the wrong tech stack. It is crucial for founders to survive and navigate through the noise, even when the situation isn’t ideal.

2. You can always improve existing solutions instead of reinventing the wheel.

   → One of the things Notion did was provide a new solution from a different approach. The company didn’t reinvent the wheel; instead, it simply offered a solution to a problem from a fresh perspective and method. You don’t always need to reinvent the wheel; sometimes, you just need to approach an existing problem from a new angle.

3. Having a great product is a necessity:

   → Notion created a product that was simply beautiful. The simple design, which allowed for limitless collaboration, is just one of the features of a great product. No matter how effective the marketing is, success requires having a great product that not only addresses pain points but also includes other factors such as excellent design—especially in an extremely competitive market with many alternatives (e.g., Notion vs. Google Workspace, Microsoft 365, Obsidian, Trello, Asana, etc.).

4. Building a community, especially during the early stages, is crucial:

   → Having a community for your startup is crucial. Notion was able to grow its community not only because of its product but also due to the company's focus on its community and its efforts to provide value and entertainment. For example, providing company-generated templates alongside featuring free or paid templates created by enthusiastic individual users illustrates how Notion delivers value and entertainment. This approach not only offers more resources to general users but also allows individual creators to monetize their work, adding significant value to the community.

5. Making your product accessible is crucial:

   → Creating an amazing product that solves pain points is only part of the equation; making it as accessible as possible is equally crucial. If the entry barrier is too high, especially for products that follow a freemium model, people may not discover how great your product or service is. It is essential to capture core users in the early stages and leverage their feedback to drive growth. Satisfied core users will spread the word and become advocates for your product or service — just as Notion has done and continues to do.

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Thank you so much for reading!

-Harry