Building Notion: The Journey of Creating a Horizontal Product with Ivan Zhao

The Early Years of Notion

Ivan Zhao, co-founder and CEO of Notion, describes the first three to four years of the company as the "lost years". During this time, they tried many different versions of the product before finding the right approach:

"The first version was 'everybody can make and create their software, so let's just build a developer tool that's so easy that more people can do that'. We tried that for a couple years and learned that actually most people just don't care. The majority of people wake up, they have a report due, they need to get their job done. They don't care about creating software to optimize whatever they're doing."

After realizing this, the Notion team had an important insight:

"Our realization was actually let's hide our vision, which is everybody can create their software, in the form factor that people do care about. So what kind of tool do people use every day? Productivity software."

This led them to pivot Notion into more of a productivity suite, while still maintaining the underlying vision of empowering people to create software. Ivan describes it as hiding the "broccoli" (their original vision) inside the "sugar" (productivity tools people actually want to use).

Finding Product-Market Fit

It took Notion about 2-3 years to realize they needed to build a productivity tool rather than a pure developer tool. Ivan emphasizes the importance of balancing your own vision with what users actually want and need:

"There are different energies you need to create a balance - too much of yourself, then there's no users, you're just doing an art project. And too much for business, you're building a commodity."

He notes that Notion aims to be somewhere in between, with a mix of idealism and pragmatism. The process of finding product-market fit was gradual rather than a sudden moment:

"It never hit me or us as like a binary state. It's just kind of like 'Oh good, we have people who care about this thing we make now. Oh good, people are reaching out to us or paying us.' It's a kind of very gradual ramp."

Staying Lean and Efficient

Notion has been known for staying relatively small and lean as a company, even as they've scaled to billions in valuation. Ivan shared some insights on their approach:

"We're lucky that me and Simon and AE, we have the skill set you probably can run a whole company with just couple of us. I can code, I can design, I can do marketing, storytelling, talk, close sales deals. So you sort of realize you don't need a lot."

He emphasizes focusing on systems and tools rather than just adding headcount:

"The part that you do need people, maybe you can solve better through systems, through better tools. Like Notion itself is a meta tool to do other tools. So we pretty much run everything on Notion."

This lean approach has allowed Notion to stay profitable and avoid constant fundraising cycles. Ivan notes they try to track "talent density" rather than just employee count.

Building a Horizontal Product

Notion is a horizontal platform that can be used for many different use cases, from project management to CRM to documentation. Ivan shared some lessons on successfully building this type of product:

"Segmentation is quite important because people can use Lego for different things. Only hardcore Lego fans care about Lego bricks. Most people care about Lego boxes, and they actually want the Lego box to be ready-made when you unpackage the box."

He notes they've had to shift their mindset from just providing "Lego bricks" to also offering pre-built "Lego boxes" or solutions, especially as they move upmarket to larger enterprise customers.

Ivan also emphasized the importance of having a large top-of-funnel use case to drive growth:

"Notion - we always want to build a meta tool, a tool to build other software. We somehow stumbled upon documents/notes as one use case and that just gave us a large top of funnel. There's 1 billion plus people who use this use case every day."

This allowed them to grow their user base through personal use before expanding into more business-focused use cases.

Leveraging AI

Ivan sees AI as a major opportunity for Notion, especially given their position as a horizontal platform with lots of user data:

"AI is so good at reasoning and understanding and searching things. And it can do a much better job of finding and searching things if all the information is together. That's when we realized AI is really good with bundled offerings, AI is really good with horizontal tools."

He outlined three key areas they're focusing on with AI:

1. AI writing capabilities integrated into Notion's existing surfaces
2. AI-powered Q&A and search across all information in Notion
3. Using AI to help users more easily piece together Notion's building blocks into custom solutions

On the third point, Ivan noted:

"Now we're looking at - holy cow, we spent the last 5-6 years building all those Lego blocks for knowledge work. If you're just putting an AI coding agent on top of it, you can create any kind of knowledge customer software, customer agent for whatever your vertical use cases you need."

Advice for Founders

Ivan shared some key advice for founders looking to build horizontal or bundled products:

• Don't be afraid to reset and throw away work if you find a better abstraction or approach
• Try to find a large top-of-funnel use case to drive initial growth
• Balance building for your own vision vs. what users actually want and need
• Look beyond tech for inspiration - study history, other industries, complex systems
• Think about what human qualities your product is amplifying or extending

He summarized his philosophy:

"I like to think of things as a craft - just make it better, make it for yourself. If it's unique enough for yourself and useful for others, success will follow."

Conclusion

Ivan Zhao's journey with Notion showcases the challenges and rewards of building an ambitious horizontal product. By staying lean, iterating persistently, and balancing vision with market needs, Notion has grown into one of the most popular productivity tools while maintaining its core mission of empowering users to create software. As AI opens up new possibilities, Notion seems well-positioned to continue evolving and expanding its impact.

Article created from: https://www.youtube.com/watch?v=IIPKMixTMfE