How Notion Found Product-Market Fit After Failure

TL;DR

Notion found product-market fit by shifting from a confusing app-building platform to templates that helped people complete specific jobs, while preserving flexible building blocks underneath. After rebuilding the software during a reset in Kyoto, the company released Notion 2.0, added databases, strengthened distribution through global communities, and grew from eight employees to nearly 500 as its business expanded more than 100-fold in four years.

Transcript

I'm Akshay Kothari. I'm the co-founder and COO of Notion. Notion is a productivity software company. And what we're trying to do is essentially provide you one simple medium where you can essentially do all your work, everything from note taking to having a knowledge base for a company, managing your projects all in a single... Read More

Key Insights

• Shipping early is a practical way to generate feedback and momentum. Kothari initially wanted to improve Pulse before releasing it, but his professor encouraged publication of the beta version. The launch brought user feedback, product improvements, market exposure, and the foundation for turning a class project into a company.
• A real user problem is more valuable than the abstract desire to become an entrepreneur. Pulse succeeded where Kothari's earlier attempts failed because it addressed a concrete difficulty: reading news on a phone was hard in 2010, so people had a clear reason to adopt the application.
• Distribution is half of the product-building challenge. Kothari argues that even an excellent product can remain unknown if its creators do not determine how to bring it to market. This lesson later shaped Notion's approach to go-to-market operations and its reliance on enthusiastic user communities.
• Notion's original concept was a platform for building websites and web applications. Zhao wanted to give people modular components for creating software without traditional coding, but the result resembled a confusing combination of collaborative document editing and a development environment for the web.
• The first version of Notion misunderstood what most users wanted. Zhao eventually recognized that very few people wake up wanting to build applications. Most people want to complete their jobs, so the product needed to present useful outcomes instead of asking users to construct software from basic capabilities.
• A complete technical rewrite became necessary because Notion's underlying platform was unstable. The team struggled to distinguish its own defects from platform defects, faced limited time and money, reduced the company to its founders, and relocated to quieter, less expensive Kyoto to concentrate on rebuilding the software.
• Notion 2.0 reached a tipping point by combining databases with job-specific templates. The underlying customization remained available, but the company changed its message from building arbitrary software to completing recognizable tasks, such as creating a knowledge base and collaborating with colleagues or friends.
• Notion's growth combined product-market fit with complementary leadership and community distribution. Kothari joined as COO in 2018 to build go-to-market and foundational teams while Zhao remained focused on product. The company grew from eight people to nearly 500, while its business increased more than 100-fold in four years.

Questions & Answers

Q: How did Notion find product-market fit?

Notion found product-market fit by changing how it presented and structured its capabilities. Instead of asking users to build software from modular components, Notion 2.0 offered templates for specific jobs, including knowledge bases and collaboration. The database function also became an important part of the release. Users retained the ability to customize the underlying system, but they could begin with an understandable outcome rather than a blank software-building platform.

Q: Why did the first version of Notion fail?

The first version of Notion focused on letting people build websites and web applications from flexible components. Zhao later concluded that this approach reflected what the founders imagined people wanted, not what most users actually wanted. Few people begin their day hoping to build software. The product was also confusing and rested on an unstable technical foundation, making it difficult to determine whether problems came from Notion's code or its underlying platform.

Q: Why did Notion rebuild its software in Kyoto?

Notion's founders believed a full rewrite was necessary because the original technical foundation was unstable and the company was running short on time and money. They laid off the rest of the small team and sought a quiet, affordable place where they could focus on coding. Kyoto offered larger older houses, a slower pace of life, and lower costs than San Francisco, while also being somewhere they had wanted to visit.

Q: What did Akshay Kothari learn from launching Pulse?

Kothari learned that founders should favor action by releasing products early enough to receive real feedback. He had wanted to keep improving Pulse privately, but a professor pushed him to publish the beta. The release helped the team improve the application and enter the market. He also learned to solve an existing user problem and to plan distribution, because product quality alone does not ensure that people will discover or adopt it.

Q: How did Pulse become a company from a class project?

Pulse began as a Stanford class project for an 11-week course and was assembled in about six weeks. Kothari and his collaborator released the imperfect version in the App Store without knowing how it would perform. Within weeks it rose to the top of the store, and Steve Jobs highlighted it at WWDC in 2010. That exposure and the market response transformed the project into a company almost overnight.

Q: What changed with the release of Notion 2.0?

Notion 2.0 introduced the database and shifted the product toward practical templates for work. Rather than promoting Notion primarily as a system for building arbitrary software, the company showed users concrete solutions, such as a collaborative knowledge base. The flexible components remained underneath, so users could still modify the product and create custom systems. The difference was that Notion began with familiar tasks and clearer reasons to use it.

Q: Why did Akshay Kothari join Notion as COO?

Kothari joined after meeting Zhao for breakfast in the summer of 2018, when Notion had about eight employees and had recently reached product-market fit. Zhao needed a COO to scale the business, build go-to-market operations, and establish foundational teams while he continued concentrating on product. Kothari viewed the role as an opportunity to return to building and help take a promising product to a much larger audience.

Q: How did community contribute to Notion's global growth?

Notion's international user communities helped distribute knowledge, templates, guides, and practical techniques for using the product. The first Notion consultant in Korea discovered Notion during the Product Hunt release of Notion 2.0, valued its database function, and shared expertise through social media. That South Korean community reached 43,000 members, and similar communities appeared around the world, supporting adoption beyond the company's direct marketing efforts.

Summary & Key Takeaways

• Akshay Kothari moved from electrical engineering toward product and business after discovering that granular engineering work did not suit him. A year in venture capital inspired him to become an entrepreneur. At Stanford, repeated startup attempts culminated in Pulse, a news application built as a class project and released quickly to the App Store.

• Pulse taught Kothari to ship early, solve an existing problem, and treat distribution as essential. A professor encouraged him to release the unfinished product, which generated feedback and momentum. Pulse addressed the difficulty of reading news on phones in 2010, reached the top of the App Store, and was featured by Steve Jobs.

• Ivan Zhao initially designed Notion as a platform for building websites and web applications, but users generally wanted tools for completing work rather than creating software. After technical problems forced a full rewrite, the team rebuilt Notion in Kyoto. Notion 2.0 paired flexible capabilities with practical templates, databases, and community-led distribution.