Latest / Startup Stories with Fexingo: Conversations About Founders, Funding, and Building Companies from Zero / How Notion Built a Product Without a Category
Transcript
- Lucas: There's a moment in every startup founder's life when they realize the product they launched is not the product people want. For Notion, that moment happened in 2018, and it almost killed the company. Luna: Wait — Notion? The app that everyone uses for everything from project management to personal wikis? That Notion almost died? Lucas: Exactly. We're so used to seeing Notion as this unstoppable force — 30 million users, a $10 billion valuation — that it's easy to forget how close it came to being nothing. The founders, Ivan Zhao and Simon Last, built the first version in 2013, and it was a mess. Luna: What was wrong with it? Lucas: Everything. The original pitch was 'an all-in-one workspace,' which sounds fine in theory, but in practice it meant they tried to do too much at once. You had documents, spreadsheets, wikis, databases, even a calendar — all crammed into a single interface that was buggy, slow, and confusing. Users didn't know what to do with it. Luna: So it was a jack of all trades, master of none. Lucas: Exactly. They raised a small seed round — about $2 million from a single angel investor — and then spent years iterating without finding product-market fit. By 2016, they were running out of money. Ivan Zhao later said they had maybe six months of runway left. That's when they made the decision that saved the company. Luna: Which was? Lucas: They stripped the product down to almost nothing. They removed the calendar, simplified the spreadsheet, killed half the templates. The new version, Notion 2.0, was basically a blank page with a few building blocks — text, images, to-do lists, and a database that looked like a table. That's it. Luna: That seems counterintuitive. If users were already confused, why give them less? Lucas: Because the problem wasn't that Notion lacked features — it was that it had too many, and none of them were great. Ivan Zhao realized that the core insight wasn't 'let's build everything,' but 'let's give people a blank canvas and let them build what they need.' That shift from a product that dictates workflows to one that adapts to the user was radical. Luna: And users responded? Lucas: Slowly at first. The 2.0 launch in 2016 didn't go viral. But the users who did stay were fanatical. They built their own templates, shared them online, and started creating a community. Notion leaned into that — they made template-sharing a core part of the experience. By 2018, they had a small but passionate user base and a waitlist of about 100,000 people. Luna: A hundred thousand on a waitlist — that's not small. But still a far cry from where they are now. Lucas: Right. The real breakout came with version 4.0 in 2018. That was the 'blocks' redesign — every piece of content became a block that could be moved, nested, and transformed. A paragraph could become a to-do, a heading, a database row, or a code snippet. That flexibility, combined with the template ecosystem, finally clicked. Luna: So the secret wasn't adding features — it was making the existing ones more modular. Lucas: Exactly. And it paid off. In the year after 4.0 launched, Notion's user base grew 400 percent. They went from tens of thousands of users to hundreds of thousands. By 2020, they had over a million. And they did it without a sales team, without traditional marketing — just word of mouth and a product that people wanted to show off. Luna: I think that's part of why it worked. Notion became a status symbol among productivity nerds. If you used Notion, you were part of a tribe. Lucas: Exactly. And that tribal feeling is incredibly hard to manufacture. It's one of those startup moments where everything aligns — the right product at the right time, with a community that amplifies it. But it almost didn't happen. If they had kept adding features instead of subtracting, they would have run out of money and disappeared. Luna: So the lesson is: know when to cut. That's harder than it sounds. Lucas: Much harder. Because every founder has ego attached to their features. They think 'we built this, so it must be valuable.' But Notion showed that sometimes the most valuable thing you can do is delete. Luna: And they never raised a huge Series A, right? I remember reading they stayed lean for a long time. Lucas: They did. Until 2019, they had only raised that initial $2 million seed round. They were profitable on that tiny base because they kept costs low — no fancy office, no big marketing spend. They only raised their Series A, $10 million from Index Ventures, after they had already hit product-market fit. Luna: That's almost the opposite of the typical Silicon Valley playbook. Raise big, spend big, figure it out later. Lucas: It's refreshing, honestly. And it's a reminder that venture capital isn't a requirement for success. Notion could have died waiting for a big check, but instead they built something people loved first. Luna: Speaking of building something people love — a couple of dollars a month is genuinely what keeps these conversations going. If you've gotten something out of them, buy me a coffee dot com slash fexingo. It makes a real difference. Lucas: Yeah, listener support is what keeps this show ad-free and independent. So if you can, that's the best way to say thanks. Luna: Back to Notion — I'm curious about the team. Ivan Zhao is the face, but it's a small founding team. Who else was key? Lucas: Simon Last was the technical co-founder, and he built the early architecture. But there's also Axel Hansson, who joined later as a designer and shaped the visual language — the clean, minimal look that makes Notion feel so different from something like Confluence or SharePoint. That design sensibility was crucial. Luna: So it's not just about features — it's about how it feels to use the product. Lucas: Exactly. And that feeling is hard to copy. Notion has competitors now — Coda, Anytype, even Microsoft Loop — but none have the same community energy. The templates, the YouTube tutorials, the subreddit — it's an ecosystem, not just a tool. Luna: Do you think the 'subtraction strategy' is replicable? Could another startup do what Notion did? Lucas: I think the principle is universal — find the one thing you do better than anyone else and focus on that — but the execution is specific to Notion. They were building for knowledge workers who were underserved by bloated software. That same white space might not exist in every category. Luna: Still, it's a powerful story. And it ends well. Lucas: It does. Notion is now valued at $10 billion, with millions of users and a product that defines a category it essentially created. Not bad for a company that almost died because it had too many features. Luna: Maybe the takeaway for founders is: don't be afraid to break your own product. Sometimes the best version is the one you haven't built yet. Lucas: Absolutely. That's a good note to end on. Thanks for listening.