Notion’s Ivan Zhao: The Refounder

We started a mantra in the company. We want to be a jazz band, not a marching band.

I love that.

It's like a self-reflecting value thing. It's auto-equilibrium with me. So it's like, okay, I'm a jazz band person. So we've been hiring more and more jazz band person. Also, AI happened in the past 2 and a half years, so more jazz band people can really shine during this moment.

Okay, so we had manager mode, we have founder mode, there's this new mode. What should we call it?

Jazz mode, maybe.

That's not bad, actually. Hey everybody, today we have Ivan Zhao on, the co-founder and CEO of Notion. I like to think of him as the re-founder. He started the company a long time ago in 2015. He didn't have product market fit. He and his co-founder moved to Kyoto of all places and kind of restarted the company and rebuilt it. After that, they got product market fit and it really took off. He did the same thing in 2023 around generative AI in an offsite down in Cancun and literally restarted the company. And in my mind, he's the canonical example of how a SaaS company can move and become an AI company. So that's super interesting. The second thing that's interesting is just hearing how he builds the company. He's very AI native in the way he organizes the company, the way he compensates people, the way he builds today. And it rhymes a lot with some other CEOs that have interviewed, like Jack Dorsey a couple weeks ago. I hope you like it. What do you think of my outfit, by the way?

I think your outfit, it's Your pants could be looser.

Looser? Okay, on the bottom or just in general?

In general.

Okay.

I like your sneakers. I don't know what they are.

Okay, they're Italian, Premiata.

That's cool.

You're known as a very fashionable fellow. Where do you shop these days here in New York?

New York has a good store near here in like SoHo, Tribeca called La Casson. Not like a designer designer, but more like a European easy To wear.

I like the vibe. Thank you. I got up my game, Ivan.

We're just channeling some nice lady.

Let's go shopping. You want to go shopping?

It's right around here. Let's go shopping afterwards. We can go.

Okay. I want to talk about CEO stuff, not just fashion. I've been doing this Sequoia thing for a couple of years and a lot has changed in CEOdom. Like the whole manager mode, founder mode thing happened, and now it's founder mode and some new mode seems to be happening. Let's just reflect back when Paul Graham's Founder Mode memo came out. My, my personal— When was that?

It's 2022, right?

2021? No, no, no. It's like, it was later than that. It's like 2024. My reaction, by the way, was relief because I was a quirky kind of founder mode type of person, always being— everyone's trying to talk me out of doing that. What was your reaction?

I didn't have too much of a reaction, to be honest.

Yeah. Nowadays, you know, Jack Dorsey kind of redesigning his company to put AI in the middle and Brian Armstrong doing the same thing. My sense is you're kind of heading this way as well. Can you talk about your journey there, your company's journey? What's new? How are you thinking about the organization? How's it changing?

Yeah, my journey actually, I have a small detour off the founder mode, which is like, Try to delegate, trying to grow your— Notion has very big small as a company in the early days. Like we had product market fit 2019, early 2020. We're sub-10-ish people 2019 and company become profitable because we're small, right?

Did you raise venture in the early days or you bootstrapped it?

We raised venture.

You did? Okay, that must have been tough.

It was tough. Like first 5 years just C-stage money dragged us for 5 years.

Yeah, HubSpot was like that. Took us a long time to get to product market fit.

It's very tough. Yeah, it's a different type of tough compared to now. Back then, there's no product market fit, it's despair. You just black, you don't know where to go, right? So we have been very small from the get-go and we sort of taste the sweet of it because as you're small, you're profitable, easier to raise money, you're default alive. And we've been resisting growing team size. And during COVID a lot of companies really blew up. Remember that, right?

I'm sure you did.

We relatively, yeah, blew up.

You got to product market fit at the right time.

We got to product market fit around the same time. There's a lot of advice that you gotta grow. So we did grow relative to other companies, still resistant to grow a lot in terms of headcount. But that's the moment that I sort of learned, oh, you need to delegate, need to have introduced professional management. Why?

Who is telling you that?

That's a good question. Who tell us? Some investors. You didn't tell me that. I don't think so.

It was conventional wisdom amongst the investor class.

I would say there's a pro and con for that. Like we sort of, I resisted that for a long time. So we did not build a sales team. In retrospect, I should have started sales team earlier because I thought I can first principle the whole way. Like create new kind of PLG, some kind of brand new motion. That's a mistake. The other part is product, marketing, engineer, those functions sort of, I wouldn't call mistake, but would upend the traditional way of building it.

Did you hire been-there-done-that people in that phase?

We did.

And do you have any of them still?

Many of them are still with us. Yeah. Our CTO, it's last 3 years. Before that, there's another CTO during that phase. But I would say some part of Notion DNA are defined by the classic SaaS executive. Now the thing changed in the past 3 years since we're building with AI, like we're one of the earlier adopters of language modeling in our product. And you start thinking things are breaking, building with this new technology, the classic boundary between roles doesn't quite work. The analogy I like to use back then, it still is, is like building classic software is like engineering a bridge. If you can design it, you usually can build it fairly predictable. Like product manager talks to customers, pass to designer, pass to engineers. Building with language model back then is somewhat still is, it's like brewing beer. You can't truly predict the things, right? The underlying thing.

Good analogy.

You cannot tell the yeast, hey, hey guys, go towards that flavor profile more. You can't do that, right? You sort of have to throw your best people in there, see what the model, see what technology gives you. So it's not customer first, it's more like experiment with this technology first. Although the last year or so, model gets so much better now, but still the spirit is technology-first driven. development rather than customer-driven first development. That really forced us to change the, at least how we build product. Designer is the most productive thing, our designer and engineer and product people just sit in the same bucket and work with evals, work with experiences and figure out new things.

And inside your company has one of those personas kind of dominated and the other ones fallen aside or is there, they all kind of do the same thing now?

We always started by like our DNA in the early days, always blurry. Like we are one of the first to hire designers who can code. I'm a designer who can code, right? So we build a company based on my image and my co-founder's image. So those profiles really shine. Designer who can code, engineer have strong product sense, PMs not afraid to roll up sleeves and try things. Like one of our Heaviest token consumption person in the company is a PM, for example. Those people really shine and we have quite a few of them in the Notion.

Okay, so you read the Dorsey stuff, you read the Armstrong stuff. My summary of it is they think of like a big triangle org chart. It's very inefficient flow of information up and down and across it. It's been around for thousands of years and it's time to rethink it. Basically stick AI in the middle and start delegating more and more over time and letting the system make decisions and feeding it context in good ways. That's kind of my high-level summary of it. What's your take on what those two are doing? And are you doing basically the same thing?

In some sense, we're creating product for other companies to do that.

But yourself?

The high premise is similar, at least my interpretation of it. It's so much knowledge work, it's paper pushing. In the past, it's really hard, required software to push information from one person to another. But So much of the knowledge work is fuzzy. So humans need to be in the middle to push information from one to the other. And turns out language models can do really good at 2 things. One thing is to write the software to design the perfect pipes for your company to push information and decisions. Second is actually do this kind of mini decision-making in the stop between one decision point to another decision point, right? So a lot of used to companies, a lot of people just in the middle to pushing information decision around to sustain a business at scale, that could be rethink.

Okay.

The analogy I like to use, we've been using somewhat, is like before steel, buildings cannot be higher than 5, 6 floors. And New York City are largely 6-floor-tall iron and stone and bricks. After steel, there's You— information or weight structure can go much higher. Since sometimes language model plus software is that, it's the steel for organizations.

What does the organization look like now that we have the steel?

I think—

I know buildings got taller. What happens to organizations?

I think everybody's trying to figure out, right? Like Dorsey's structure is like 3 layers or something, or 3 types of people, right?

Yeah, 3 types of people that sit around the AI system that mostly train it. Extremely flat. And I think Brian Armstrong said it's 5 layers and everyone's a player coach, which I think is pretty interesting.

I think all the spirits are right. I don't think, and I believe it should be hierarchical. Like, I think people tried in the past, like flat organizational structure. I don't think that's part of human nature. Human nature are hierarchical.

And do you think that's changed now we have AI that it can be flatter or you're like, that's BS?

Oh, definitely can be flatter. Like we are getting flatter and flatter.

Okay. How many direct reports do you have?

I have 7, 8.

And generally what is it?

Company-wise, probably around 7, 8, 9 people per person.

A lot of people are going to 15, 20, 25.

Yeah. Many of our best people, 15, 20, 20-something.

Got it. How have you changed your company? How you compensate people, how you build your org, how you hire people? Just in the last year as all this stuff has developed?

Yeah, 2 years ago we start to hire different shape of engineers. No longer optimize for people's experience, optimize for people's agency, energy, optimism, curiosity. A rough framework we're using like, okay, what is the talent in the company? A talent equal to this person's capability, slash experience times this person's tastes or value system times this person's agency, will, right? What language model change is like, just like Google, everybody can access information. Language model allow everybody to be a pretty good writer and programmer. So capability got normalized, democratized, and taste becomes still important. Like what's your value system? What do you want to bring to the world? Which direction do you want to go? That you cannot change as easily. And your will, how hard do you work, this you cannot change. So we optimize for the latter too today. That means in the engineer sense, we hire for much younger people. Internally we call like IC, early out-of-school IC.

This is the opposite of the way most of the CEOs I'm interviewing are going. It's interesting.

No, I think more people are realizing.

They say that like a junior engineer powered by this stuff's more productive, but if you get a senior engineer that understands the whole system, been there a while, and they're pilled. There are like 100.

Yes. So higher for super junior, super senior.

Oh, interesting.

So the shape, it's not, it's more like the barbell shape, right? Because the senior provides taste. There's still a lot of auto-distribution information in language model architecture and language models known very bad with that. So they need to provide a direction. It's almost like this, a good engineer managing 4 to 6 coding agents at once, right? But a good, really senior architectural engineer can manage 2 to 3 junior interns or engineers. They each manage 2 or 3, then that's the number is higher, right? And they can train the next generation. I think that might be a more optimal shape than a bunch of senior people manage coding agents.

Okay. And you're— I assume you're still hiring designers and still hiring PMs. Is the ratio changing? Or are you just hiring people to do the whole thing?

The definition of designer PM are different. Like we intentionally hire designer who work as PM. PM can usually the other way, usually it's designer who can work as PM. It's harder for PM to work as designer because it's the visual craft.

It's a genetic thing.

It's more like a visual craft takes years to train, right?

But designers want to talk to customers and get feedback? Yeah.

Rare, but don't stereotype designers though. They do exist.

So if I look at your website, you're hiring engineers, junior, senior. Are you hiring PMs and designers or do you have some— I don't know how to combine those 2 words together.

Well, we hire PM designers by the way we interview them, we evaluate them. Like we're in talk with 2 to 3 design leaders. They're kind of— we evaluate them as PMs basically. Can you drive things yourself? It's not just come up with good ideas. How much are you interfacing with customers besides you're good with craft, design craft?

Some of this stuff is like the fashions change. Like for the longest time was experience, then the word everyone used was slope. We hire for slope and now it's kind of taste and curiosity and agency.

That's kind of slope though. That's like the—

Slope-ish.

How is it different?

Slope to me is just horsepower smart.

Well, intelligence is first intelligence, multiple dimensions.

Like GPU speed, like how'd you do on your friggin SATs?

But there's plenty smart people who are lazy.

That's for sure.

Do you call that high slope or low slope?

I don't know. I just always bucketed into hire the people who learn fast and are very smart. And I think it's changed too. The word taste comes up a lot in your You've been talking about taste for a long time. The industry talks— why is that all of a sudden a thing? Why is that word everywhere now?

Because taste is not in language models. Taste is in— if you zoom a long, long time, maybe it is, but right now it's not. And taste is more rooted based on your value system. Are you drinking sparkling water or still water? Are you drinking Diet Coke or iced tea? It's to each their own. There's no right answers.

The rest of you, you've got more than just engineering. You've got a bunch of HubSpot people here, which is great, but let's just take marketing. Is the criteria changed there too?

We actually changed our marketing department. We no longer have a CMO organization. This is this year, last year, this year. Yeah, we break up our CMO organization into storytelling, which is closer to product, closer to 'Cause the product is changing so fast. It's like you just, classic marketing can't keep up. We haven't shipped this fast before, right? So let's just have that sit next to product, directly connect to social where people are, discussions are happening. And then the other part is like serving the sales go-to-market function, like demand gen.

Lead gen.

Lead gen. So it's like we really, really focus on that. So rather than information round trip to a CMO, then figure out how to serve both the product side and the go-to-market side. No more, just like let both sides figure out themselves, not themselves, but more decentralized.

And are there any other of the classic marketing functions in there? It's sort of those are the two.

Those are the two. The designers, there are also designer and creative part on the storytelling side.

Like community?

Yeah, community is in there. It's a community as part of the community ecosystem organization, which is startup, Where it's one of the most important communities, Notion fans around the world, and figure out how to move our market through those people, right? That's the bucket of people.

And has the criteria changed? Sales, marketing, all the different other functions, have you changed the way you think about the hire? Like most companies have a form when you interview someone, has that form changed?

Yes, we're actually in the middle of, you know, I just described engineer one, right? Engineer and designer, it's the— we changed 2 years ago.

Yes.

Go-to-market, marketing, we changed 6 months-ish ago. Sales, we're changing right now.

And when you hire a sales rep, do they have to be AI-pilled?

Yes. We actually changed our first interview. No longer looking at your resume, build something for us. Send a Notion link, send something that you built. We look at what you built.

How about compensation? Is that changing? My sense is we had an environment where At least in HubSpot, we said people are much more productive than the average person. Now it's even more so. Have you rethought—

We are changing that as well. So they need to be extremely a lot more meritocracy. You can't peanut butter things. I think the SaaS era is kind of like playbook peanut butter. Everybody, it's like a pretty peaceful era. Right now it's wartime.

Totally.

Actually makes us ask, like, what are we doing back then?

Well, nothing changed for the longest time.

Like nothing is kind of boring, right? Like Notion, we had—

The reason I left HubSpot, it's like, okay, we're building this platform, we need to build more apps, we need to keep opening the platform, we need to hire more reps and just like keep going until a couple years ago. Now it's completely changed.

Well, you can't— welcome back to become operators.

That's why I joined Sequoia. I'm like, whoa, there's so much exciting things going on.

When we hit product market fit and COVID happened, it's more like world changing, but not like people building things and technology changing.

Do you prefer wartime or peacetime?

Wartime's way more fun. It's like—

What's the difference? What do you do differently?

You feel more alive.

Okay, but what methods do you use that are different?

I need to take care of my body. I need to exercise every day.

I didn't think you were gonna say that, but okay.

Yeah, it's like it's more fluid.

Are you more top-down versus bottoms-up?

I think the company has a good spot. Notion right now is a good spot with me in the sense that I can dance around really smoothly either direction. There's enough people I trust really well, they can bottom up and it's constantly surprised me. Like we're a company of 1,000 people. We have about 50, 60 founders in the company, ex-founders. It's like they really can lead things, right? And they welcome me to top down into jump into any part that I can work on, I'm interested in where I can provide unique value and they don't feel territorial. This is in a good place that people who didn't feel that way either no longer at Notion or let them go. So the company and me in a pretty interesting equilibrium at the moment.

I interviewed Parker Conrad from Rippling and he's similar as a lot of founders. And the way it kind of strikes me is like the bigger HubSpot got, almost all the important things cut across all those organizations. And it was just very hard to find someone who could really drive something across the org as opposed to in their org. So we did not do that. I regret not doing more of that.

That's my real— remember I said right after COVID we scaled and then we tried to scale more traditionally. I realized that's not us, right? At that point, This was 3 years ago. We started a mantra in the company. We want to be a jazz band, not a marching band.

I love that. I do the orchestra versus jazz band. I like the marching band.

Yeah, I realized I cannot be a marching band person. That's just not me. I will feel like if everybody, I delegate everything, everybody do things, what do I do? I feel like I can't do that. So it's like a self-reflecting value thing. It's out of equilibrium with me. So it's like, okay, I'm a jazz band person. So we've been hiring more and more jazz band person. Also AI happened in the past 2 and a half years. So more jazz band people can really shine during this moment.

Okay, so we had manager mode, we have founder mode. There's this new mode. What should we call it?

Jazz mode, maybe.

That's not bad actually.

Because jazz mode has some structure, right? You don't want to be like, you want other people to contribute. You don't want, you want people to have fun. It's not just you having fun or dictating everything.

Okay, let's give that a go. Let's push that out on X and see if it sticks.

I mean, it's pretty good.

Jazz mode? Yeah, because I put a survey out the other day, like, what mode is this? And I was like, is it Dorsy mode? Is it native mode? And I said, is it other mode? And somebody put in there, it's Depeche mode.

Depeche mode?

That's a band. They were making a joke, but I like jazz mode. I think that's a good idea. One other question on this new world. I work with all these startup founders. The planning's tricky. And I sat through your pitch at Sequoia and you had a plan and you had a P&L. Like, what is it actually like internally planning-wise?

Well, we grew past our plan, which like most companies at this point, if it works, you've grown past your plan, right? So I would say the financial planning is still, at least I find useful to give you a But you know, you're on treadmill, you know how fast you're running, right? That's like a financial plan in my mind. It's like, oh, am I running 7, 8, 9, what number that is? But product strategy is, oh, there's no freaking plan.

No plan.

Because what changes the market, the technology is so fast. It's not in the 6 months, it's not 3 months, it's week by week. So this, you have to jazz this thing. Financial things, march that, right? Then at least we try to be conservative, mid to conservative with financial things and take risks. And there's a buffer, like cost becomes another dimension. Like if you're just building software, don't think about cost.

No.

Now you have to, like at least I have to really think about cost.

Can I ask you about that? Like a lot of these startups' gross margins are awful. And like I Companies like HubSpot were like 86% gross margins. That's sort of SaaS normal. What are happening to your costs and your gross margins, and where do you think it settles out for companies like yours?

I don't have an answer for you.

I'm assuming your gross margins have gotten worse, but maybe you didn't hire as much headcount, so maybe operating margins are better. And how willing are you to be, like, gross margins to get radically worse?

Oh, you have to.

You're down for that.

Yeah, like, what are you doing? Then you're not in the war mode, right? I think Notion is for knowledge work, which might have a different curve than coding products. Coding product, you run frontier models, usually the more smarter, the better. And knowledge work, you can— we already start to see this. You sort of can settle with the second tier, the Chinese models, the open weight ones. They're not super smart. A lot of this kind of paper pushing information in your company. I spilled coffee on the carpet. Can HR team come someone to tidy this up next week? That doesn't require Opus to file tickets, right? So that's a lot of problem we are best at solving at Notion. So that will have a different growth margin profile than—

Yes, of course.

The biggest product market fit today, which is a coding agent.

Yes. Okay. You're kind of in my mind, the king of refoundings.

Yeah.

You've done it, I think twice, at least Claude thinks you've done it twice. Uh, your first one, you and your co-founder moved to Kyoto, locked yourself in a very small room and rebuilt.

It's not that small, but yeah.

Okay. You know, more recently, obviously you, you, you know, this is, everybody knows the story. You went to Mexico and you had early access to the models and you turned into an AI company. Talk about the different refoundings and what was your mindset at the time? There's lots of early-stage founders who need to refound and there's a lot of bigger SaaS companies that definitely need to refound.

Yeah, I like as an idea, as the best artists reinvent themselves. Miles Davis has 3, at least 3 phases, right? Picasso, 2 to 3 phases. Michael Jordan, the second one, probably not as good, but the best one truly is Steve Jobs, the king of refunding. The first version of Notion is like, it took us 4, 5 years to find product market fit. In the middle of that, we sort of find the shape of the product we want to build, but we'll be running out of money building it. So my co-founder Sam and I said, let's just lay off everybody, just go by the two of us. That's the Japan story. We rebuilt Notion from Japan.

How hard was that, the laying off everyone?

It's not easy, but sometimes your body just tells you you have to do it. Like, you know, you're dead if you don't do it. You know, just there's like a panda energy, just like—

Why the hell did you go to Kyoto of all places?

We actually, we never been to Japan because when you just say goodbye to your friends, all those people you work with, Notion by all means not big, 5 people-ish, it's morale so low, right? So Simon and I was saying, let's go somewhere that we just change the mood a little bit. And we'd never been to Japan. So initially I picked Tokyo on Airbnb, realized that the houses are so small. I love Simon, but I don't wanna cram into a small apartment with him. And Kyoto, the apartment much bigger because they didn't get burned down in World War II.

They weren't bombed.

They weren't bombed. They spared that city, too much treasures. And the house is much bigger and cheaper. So that's why we picked Kyoto. And we ran our place in SF and our office in SF. We actually become cash flow positive doing that. That's the first time. But once you land, you start coding, Just those kind of rapid coding, eating, coding, eating. It's actually really liberating.

I lived in Japan for a couple years. Was there something about Japan that was inspirational in your refounding or the way you built the product? There's a certain aesthetic there that sort of rhymes with Notion, or could you have been in anywhere? Could you have been in Thailand?

Well, usually we like Summer warm. Simon likes warm climate. Ideally he can swim. Japan just happened to be— we're both curious about it. But once you go to Kyoto, I don't know, you've probably been to Kyoto. It's a very special city.

Very special.

Yeah.

Very inspirational.

Very inspirational. Those things are hundreds, everything. Oh, this shop, 150 years old, right? Open that door, the shrine's been there for 800.

So if you were at a beautiful place in Thailand, Phuket, whatever, do you think you still would've pulled it off or is there something magical about the location that really worked?

Most of our things are a story we tell ourselves.

Of course. What story is the true story?

The story we tell ourselves is like Kyoto is a special place. If you can pull off anywhere, you can pull off from reborn in Kyoto. And it's also inspiring. Just look at the surrounding, the craft is probably craft capital of Asia, right? So just make you okay if Notion fundamentally is tool, is a tool for humans. And those people are building knives, ceramic cups, tatami seats, and like they're the tools, other tools for humans.

It's craft central.

It's craft central. And it's like, how do we, how can you not be inspired by building a better software?

Okay, you still haven't answered my question.

Which is?

If you had gone to whatever, let's pick someplace in the Philippines and it was pretty, Would you have pulled this off or was there something exceptionally important about being immersed in such a craft-centric place?

I think I would've pulled it off, but yeah, but the story is the better story.

Okay, fine. Okay, so your big refounding, not easy. Didn't immediately hit product market fit after, still not immediately.

No, it took a while after that because it took a year and a half to rebuild from scratch.

Why didn't you just quit and start a new company at that point?

We never start a company for starting a company. You want to build something. Like I got obsessed about this notion-shaped tool problem since last year college. And Simon and I were both in this kind of tools for thought community, which is you can trace the lineage back to Grateful Dead era, the first generation computing pioneers around the Bay Area. Like the lineage traced way back, directly back to there. I want to continue that lineage. So to me, it's not—

It wasn't like you had another idea kicking around. This is your life's work.

And this is like bigger than I can ever chew on this idea. So I wouldn't do anything else. He's in that community. He's obsessed with this idea too. So if we don't work on this, we'll work on another company doing the same thing.

Okay. I'm going to get back to the refounding, but just on the Grateful Dead, you study very important computer scientists from the '60s. You're a student of Steve Jobs, I'm sure. There was sort of a craft ethos about the Grateful Dead and the music back then, but certainly about the company, certainly about Jobs. Is it still here? It seems like it's a lot more commercial than craft today in Silicon Valley. Have we lost that?

I think most people don't have it. Most companies don't have it.

I agree.

Like Steve Jobs, I look up to him or people like him. It's like, interception of humanity with technology versus Silicon Valley. At least tech is largely a technology and tinker culture. And tinker culture doesn't even know the history of— it's not even science, it's tinkering, right? It's like people like to build things in their garage and something works and maybe has a product market fit and grow a business out of this.

To be fair, Woz was tinkering in the garage.

Yeah, but you require to meet someone to to bring the human side of it, right? I think tinker culture, the risk of it is like you don't know what comes before you. Science, at least you respect the history. Like if we ask people who Douglas Engelbart or Alan Kay, those computing pioneers are, most people in tech have no idea.

Honestly, the only reason I know them is I worked for this guy, Ray Ozzie.

Ray Ozzie.

Well, you would know, of course, because he's the father of Notes, but he was obsessed with those 2 and talked about them constantly.

I know Ray Ozzie. It's like Microsoft CTO for a while too, right? So That lineage is broken, by the way. The people who remember the '70s and '80s, they were sort of, people don't even, yeah, they no longer work in tech today. So tech is like industry doesn't know its past. If you don't know its past, you don't know history, which is humanity. I think your point of view is like what's in front of you, what your competitors are doing. Versus if you bring humanity, you have all other disciplines around you, you have all the history behind you. There's way more good stuff you can steal from. I wish more tech founders steal from aside or from behind.

I think they'd benefit from it too. Back to the refounding. Lots of founders are going sideways. Lots of companies that started in 2021 are going sideways. They've got 10 people. It's like maybe their cash flow break even. What's your advice to somebody who's a founder, has been going sideways for a long time, got venture dollars in like you and working on product market fit? Like, should everybody just be like, rip the bandaid off and shrink it and move to Kyoto and refound?

If their body tell them so. Like I, for me, it's like there's, You just feel it. You have to do something drastic. And Simon, during that time, was— he broke his— he got his wisdom teeth taken out or something. So I'm by myself. I was like, I remember I was at my ex-girlfriend's studio. I just like an inner urge, like, there's no way out. I have to do this. And it's like, then you feel liberated once you land in Japan.

I guess your advice would be is Probably more people should do it and they should listen to their inner body and be more risk-seeking on that because they can get stuck for a long time in a venture-backed startup. They can spend 15 years of their career on something going sideways.

I think there's no better time than now to do that because the market dynamic is wide open.

Yep, I agree. Okay, you refounded a second time when you had 1,000 employees.

Back then it was probably 500, yeah.

Okay, 500 employees, different animal. Without telling the same story you've told 1,000 times, because I think everyone knows the lore, what was it like kind of behind the scenes? What did you feel? Was it the same thing? Your body felt it? Like, what was the story?

So the second time was in Mexico, Cancun.

Right.

Happened to be out somewhere.

Right, you're always in a nice place.

We just got early access to GPT-4 model. It feels like the world is stopping. Like when you first interaction with the GPT-3 is fine. GPT-4 is a religious experience for me. It's like, holy shit. It's a full body religious experience. Like you have to do something with this. This is what changed everything. Anything you do, if you don't do this, it will be meaningless. I think the company has been fairly— there's been people doubt because they remember that around 3 years ago, that's Like the crypto era lending, right? A lot of people, is this another crypto thing? There were a lot of doubters. Some of them obviously no longer at the company, but the conviction is so clear, at least for me and Sam in early days, like we just have to do this.

Did you take 2 steps back in the business to go 10 steps forward? Like did revenue really slow while you were rebuilding everything?

Our first product actually has a Meaningful revenue boost. We launched our first AI product actually 2 weeks before ChatGPT happened. It was like AI writing product. That has a boost. But after that, we've been pretty much want to build agent product in 2022, end of 2022. And that's a slog. That took us a year and a half to really—

It didn't really work back then.

Didn't work at all. Like Simon, I would say My problem and Simon's problem, we might be living too much into the future.

Yep.

It bites you with new technology. Like we try everything, Anthropic built a model for us, we work OpenAI fine-tuning or another model, just none of them work. That was like a year and a half just go nowhere and morale is definitely low. Only start to work a year and a half. Our revenue growth inflection is around the same time, right?

When the AI product, the underlying got better.

Yeah, it's like, but that was a pretty painful period.

Was that the most painful period in Notion history for you?

Different type of pain.

What was the most painful?

Just when it was 2, 3 early days, pre-product market fit is despair. I was just like—

Despair, is that the word you use? Okay.

You don't know where it's coming from. You don't know where to go. Right. When your growth rate low, like during that period of time where we were trying to rebuilding our AI foundation multiple times, it's, yeah, that's not great. Right now, just everything on fire. It's a different type of pain.

Nice. So a lot of people, 500-person companies, a lot of SaaS companies are doing the AI thing. But certainly haven't refounded. Advice?

Start with your product. We just talked about treat it like brewing beer, not building bridges. Because that's end of the day, most tech companies, it's the product, right? So start with the product because then the founder has to be really hands-on to experience that way of building things.

Can non-founder-led companies pull it off?

I don't know. It'll be tough. I think founder has the moral high ground to change things. People are more tolerant and forgiving with founders, right? I think the person needs to use language modeling, just know how to feel it. Like you got to feel the AGI, feel the AI.

Yeah, you can't read about it. You can't watch YouTube.

You have to feel it. You have to feel it. Building is one of the best ways. for your product or build for your internal systems.

Build for yourself.

Yeah, tinker on the weekends, tinker on the side. You have to do that because like, I think at the end of the day, businesses are kind of like pathfinding entities, right? Like we're in this thing called a market. There's equilibrium for your company with the market, with your shareholder, with your company. Like we're just finding local optima, local maximums for different niches. When this new, brand new ingredient got introduced into the market, in this case language model, doors or paths are opened up and we are each company at different point in the market. Each, you have different angle, you have different niche. You have to take in this, internalize this new ingredient, figure out which path got opened for you. Truth is with the customer, with yourself, if you don't know how this this can do, you cannot find a new path. I think you have to do something. You have to feel this. You feel the AI, feel the AGI.

I think you're right. You use a word that I cringe at, but I think is good called a lot of companies calcify as they get older. Let's just say you're a company that's calcified. How do you get uncalcified?

We intentionally do a lot of acquisitions. We have 50, 60 founders at Notion.

And were they acquihires?

Acquihires, acquisitions. Founders are kind of this kind of like little decalcified meathead machinery just trying to break things, right? So keep your regenerating.

I agree with that.

Yeah, I find that really helpful.

So founders found for a reason and now all of a sudden they're in a 1,000-person company. How do you keep them motivated and not leaving and starting something new?

Well, first, some of them work on the domain that they were working on before. Like the person who's leading our AM meeting notes has a startup of AM meeting notes before. The company, the person leading our enterprise search is the founder of enterprise search product. So you give, actually give them a better platform support to do this. They, people feel appreciated. Like I just had lunch with the founder who started enterprise search product before. It's like—

You give them leverage. They give them leverage.

They actually, people care about the thing they're building, right? Versus fighting for product market fit in a really crowded market. They don't, you can argue that it might be more difficult to start new companies today compared to even a year ago.

Okay.

Because the world's getting more noisy. Like the shipping cadence from existing companies are just increasing. It's like everybody got Twitter fatigue, right? So—

And the SaaS companies have got the memo. Most of them got the memo and are shipping fast now. You were ahead of everyone, but—

Yeah, people like, it's still—

HubSpot's cranking. That's good.

No, but people are still kicking and they have to kick in different gear.

My thing these days is like, it's never been easier to start. Man, it's never been harder to scale because like in every little micro segment, if there's a little traction, like there's 100 competitors 2 days later. And the thing I've also noticed about the startup land is almost in every one of these verticals, it's a duopoly. There's like a 1 and a 2 and then 50 tied for third that are way off. And when you look back in time, the, the, the, the great companies were often founded in shitty times because people who are really grinders and people who really wanna start a company and really have a vision start in like 2022, 2023, a terrible time to start. In times like 2026, you get a lot of tourist entrepreneurs. And so I've heard people say, you know, 2026 venture is gonna be crap even though the valuations are—

Like crypto. Crypto vibe energy.

Yeah, a little bit.

A little bit. I don't disagree. Market will do their thing. Market is kind of beautiful in that way.

Yeah. Advice to founders of reasonable-sized companies who are a little scared to refound. You know, I'm CEO of a 500-person company. It's going pretty well. I'm doing some AI stuff. My board's kind of happy with me. But there's a birdie inside of me listening to Ivan and maybe I should refound advice.

Does the person need to feel the AGI first? If you feel, you realize most tech industry is support different flavor knowledge work that we're at the beginning of how this can do due to this industry.

I agree with you. How do you think organizations look like? So they're changing a lot now. What do you think they look like in like 3, 4 years? Is your knowledge work You're right at the center of this.

I think truth is probably somewhere. There's a Dorothy, Jack Dorsey's thing. There is the traditional hierarchical ones. I like to think what are invariables? Like, let's look, invariable in this case, human nature are rather static.

Like we all We don't change that fast.

Humans don't change. Humans as a species doesn't change. That's where I think it should— it will be a hierarchical organization. If you just observe bamboo or chimpanzees, right? It's like very— if you watch nature program, there's hierarchy that doesn't change. This hasn't changed since we left Africa. Division of labor makes sense. So people have different interests. You look at all the different personality tests, right? They're just different ways of saying like, People are different. There are not 10,000 flavors of them, but there are probably a dozen flavors of humans that cluster around those different dozen things. And we'll know that our legal system, well, at least right now there's no autonomous companies, right? It's the CEO, CFO have to sign up for something. So it will be a small team of humans to start. So those to me are the invariables. So this invariable tells me You need to figure out how do those group of humans collaborate. Group of humans all have different biases, preferences, different values. And it will be somewhat a small, some kind of hierarchical system there. Then how do we use this new tech, the new ingredient to passing information decision around a small, mid-sized group of humans? That's how I think about it.

I kind of think about it as like right now in companies, the AI system makes very few of the decisions. Let's call it 1%. But as that system gets more context using Notion, for example, it'll make better decisions than humans. It'll have more context and more history. And then humans will be more training that system and giving it context and giving it taste. And I think over time the system makes more and more of the decisions instead of the humans, but the humans are still really necessary.

Yeah. People say AI researchers in 18, in 15 months will not be able to make a decision to improve AI models, right? Kind of the same thing, but they're just seeing a bleeding edge for this.

Yes. By the way, I think you're incredibly well positioned for all this.

Oh yeah.

I— I worked for a while with this guy, Ray Ozzie. It was a company called Groove Networks. We were in the knowledge management industry, which is a shit industry because chief knowledge officers have no money and it was never urgent. In theory, it sounded great. Now knowledge management is actually incredibly important and works incredibly well.

I know. It's like, What's that industry called in the '90s? People hire consultants to map out their org chart and information flow. That become like what AI is for deployment and—

Totally. And your platform is ideally suited for it.

Yeah. I think we always forget that modern knowledge work is only about 150 years old. It's invented. It's not as old as fire or language. It's only 150 years old. Yeah, right. So Why cannot be a new flavor of it?

Okay, I want to talk about you.

Okay.

I don't know you super well. You're soft-spoken and I thought you were an introvert, but in getting to know you better, was I wrong about that?

I think I'm still introverted.

Okay.

Yeah, I like one-on-one conversation than one too many. I train myself to do company all-hands just by doing a lot.

A lot of founders are introverts. The world is sort of built for— I'm kind of extroverted, extroverts. Advice for founders who just don't like talking to other, you know, don't like the whole extrovert game.

I have to evolve a lot. Like, I hate—

Did you force yourself? Yeah, I did. Like, how did it work? A significant other push you?

No, I forced myself.

Okay.

To lead a group of humans, you need to do one-to-many communications. Otherwise, people don't trust you. They want to hear from you. Writing is one mode, which is like sometimes lingnan, but even more so is face-to-face. Do the all-hands. So for a while I tried to delegate all-hands to my co-founders, to other execs. No way. I have to— now at every all-hand, I open the mic, I do it, I lead the whole all-hands. Now I'm pretty comfortable with it. I still don't love it, but I don't dread it.

Okay. Advice for people doing all-hands. Everyone seems to do it differently.

Get a teleprompter.

I'm the opposite. I can't read fast enough for the teleprompter.

Really?

Yes, I hate it.

Well, that changes me because like, well, English my second language, so it's like if I have to think and speak, it's hard. So I just prefer to spoken before. And right now all those like speech-to-text model locals are so good.

They're so good.

So good. I literally like, okay, the night before, or then I just like talk to myself and got what I roughly want to say. And the time doing all hands, teleprompter's there.

Do you do them once a week, once a month, once— like what's your cadence?

We're actually changing our cadence. Used to be once a month, right now it's every other week for all hands and every other week again for AMA. So every week now. So we got the world's fastest—

Do you ever step on yourself on an AMA? Do you ever say something you're like, I got crushed for that?

Yeah, everybody has it, right? Or just you miss a good opportunity, you can actually rally people about something, but you give a non-answer. That's the worst. And non-answers—

We, at least at HubSpot, in the company meetings and the AMAs, there would be a Slack channel on it and you go back and look at it and be like, oh, what? Just like if I said something stupid or I missed an opportunity, like it would really show up in there.

That's good.

How do you manage your time and your schedule and your deep work? Like, how do you manage your energy? Like, for me, my energy is pretty good right now. It kind of goes up and down during the day more than I would like. Is that the case for you? How do you deal with that? How do you deal with your introvert versus extrovert? Like, how do you do it? What's your schedule like?

It's actually not that crazy. Wake up 7, 7 AM, make coffee for my wife. I usually like to do work in the morning, do some thinking, writing at home. Come to office, I come to work every day. Come to office. Sometimes I'm— a new habit I'm trying right now is Doing the gym during the day.

Okay. Yeah, that's a good idea. Perk you up.

Elevate my energy during the middle of the day and work in office till 7-ish. Usually social dinner with my wife, back to work, sleep until midnight, around midnight.

When do you have time to get down the cloud rabbit hole?

Weekends. Weekends, my happy time.

Now, you describe that as your happy time?

Yeah, you can be led by your curiosity rather than by your responsibility, right? And like usually Saturday, Sunday morning, I have a bit time to read the books I want to read. Sometimes it's for work related, sometimes purely just my guilty pleasure.

And during the day, like half hours, like I'm seeing one of my founders here in New York, not gonna say who it is, he's got his schedule in 10-minute blocks.

Meeting-wise?

Yes. Like, what does your day look like?

A lot of 25-minute blocks. I usually like 5 minutes between meetings and 25, 25, 25. My team packed my meetings together so I have 1 or 2-hour chunk to think. But most of my thinking time is in the morning or in the evening. Usually I get too tired in the evening. I can't think really well. Morning's better. And I do a lot of Slack. My wife joked my Slack is my social media.

Why doesn't Notion build a Slack killer?

We should.

Definitely. A lot of your team said you're humble, and I think you are too. Why?

I wouldn't use the word humble. I use the word—

Your team uses that.

Truth-seeking, probably.

They use humble.

I think you seek truth, you know, you're just one perspective of the truth, or pluralism. There are multiple flavors of truth in the world. You know the story of blind people touching an elephant?

Yes.

And we're just different blind people touching different parts of the elephant. Sometimes it could be the tail, the elephant's a snake. Sometimes the trunk is a tree, right? That's my worldview.

Okay. Tonight we're gonna have dinner with a bunch of founders and some are at like 10 employees and they hope to go and build a 1,000-person company in the next several years. What advice do you have for them?

It's a game. It's a game that's a social game. It's like there's all the good part and bad part of social game, like human or status is human thing, right? Like power is this, the CEO game is full of that game. Just like entertainment, just like sports, you have that like high school, college lunch sessions, right? You watch that in real, in a tech scene. It also Could be a pursuit of your personal values. This is something I realized more in the past 3, 4 years. It's like I need to be in equilibrium with my own value of what this company I want to build with. That gave me more sustainable energy source. I cannot just chase something where competition for competition's sake. Like I'm really competitive. I need to compete to win. That's part of me, but at the same time, I need to be true to my own values, the value of building good tools, the craft, the human side of things, the social part of being a CEO, the market dynamic, just compete for competing's sake. And the value you personally— I wouldn't say they are— this is somewhat a zero-sum game. So you need to figure out where do you want to sit in this spectrum. And your personality might be different. Some people might just compete for compete's sake, doesn't care about what they're building. Some people just want to be popular. If you just only care about craft, then you don't build a business. You might as well just be an artist. Took me a while to realize where's my equilibrium.

Are you someone that like tries to fix your weaknesses or you just lean into your strengths? And what's your advice on that?

Definitely lean on your strength. There's a necessary thing you have to do. Like one-to-many communication likely you need to do as your company scale. Maybe you can lean more on writing rather than speaking, but there's certain invariable that works, right? Within the boundary of that, you should amplify what you're good at because capabilities are becoming more and more commoditized with machines. So it's your own point of view, your strength that you can live with. That's That's more lasting.

Okay. Something I assume that isn't your strong suit is building an enterprise sales org, which seems like you're in the process of building that. And when I hear it's going exceptionally well, how did you get your head around it? How did you hire? It sounds like you hired the right person. So many companies are PLG and are desperate to move to the enterprise, and the founders are similar mold to you. Can you talk about that?

We had a mistake. I mentioned like we sort of did not buy traditional sales motion for a good 2-ish years. If we— because Notion sales can start earlier, but we want to first principle our way into it, which is, hey, we're going to design our own system. That doesn't work. Like, again, it's a reflection of human nature. A lot of things you want to talk to a seller. There's a lot of the reason the modern sales playbook has been around for 2-ish decades, right?

So I think enterprise sales is like the last function.

I agree with you. It's like that you want to see a human, you feel comfortable, you don't want to be a doctor from a robot.

No.

Then why should you buy an expensive thing from a robot, right? So it's not that hard, I would say.

Okay.

But you need to know, like a lot of smart people might think they can create something new. Like fundamentally you should not reinvent new things unless it's really absolutely necessary. I was trying to reinvent a new go-to-market motion. That's stupid.

Okay. Like I did mine. I would build HubSpot.

Yeah, right. But that's the thing made HubSpot, right? Like this inbound.

That was the thing.

You should only have, each company should only preserve your innovation point to few places, go a couple places. You cannot Spread everywhere. Like otherwise you're spread too thin. You're like, you're trying to like reinvent the wheel too many times. We try to put our innovation point onto sales back then. Just school classic sales, it works. But you can make a lot more efficient today with a lot of tools we're building internally. That's different.

Okay, so you woke up one day, you're like, we got to get good at enterprise sales. What'd you do? What are the mistakes everyone makes when they do it? Did you miss a hire or two before you got the right person?

I thought this was somewhat solved today, right?

I kind of do, but people struggle with it. Enterprise sales has changed very little since I did it in the 1990s.

Yeah. So we tried initially only have a PLG flavor of sales, like system thinker, sales system, sales leader. Didn't quite work. It's just like, then you're just taking orders and now like the PLG give you the luxury that your customer want to buy your product.

Yes, easy to sell that.

Yes, yes.

It's like fulfilling demand.

You cannot get your sellers to do something difficult when there's so much easier thing they can do. It just doesn't work. Then we realized, okay, yes, we're starting to respect the system. So our CRO, Erica, she was CRO of GitHub before. a system thinker, right? We pair Erica with our head of sales, Purvesh, which is a rah-rah, like the meat eater, right? So veins in his teeth, perfect pairing. And so we have sellers with rah-rah Purvesh, but also respect working with Erica's overall system. This is when things start to work in the past year and a half.

Got it. And so many of the organizations I deal with, the engineers look at how much money the salespeople make and Look at the rah-rah and they roll their eyes and they complain. I assume that happened here.

No, we actually, Notion culture is always pretty receptive for different people are different. So we never have the organ rejection of sellers in the company. Our engineering team love work with sales team.

Okay, awesome. Speaking of culture, I saw online some people refer to you as a cult leader and some people referred to me as a cult leader back in the day. I didn't particularly like that. How does that land with you?

I like that.

Okay.

A company is, it's sort of a religion. You have a point of view, you have your value system project to the world through a business, through a product. Like my favorite saying is Catholic Church is one of the most successful companies of all time. 2,000 years, they have their ritual, their business models. They're still around kicking.

Great founder in Jesus and a great head of sales in Paul. Right.

And there are a lot of sellers and referral systems.

Viral marketing.

Viral marketing. OG viral marketing. Yeah. And to me, religion or belief system or value system are again one of the few dozen things that's ingrained in human nature. Like people want to believe in something to find meaning and purpose. That's why wartime makes this more fun, right? Your purpose and meaning got amplified. Work and company give people that camaraderie, give people that. That's why we play sports, right? It's the same energy.

The first 4 words in culture are cult.

Yeah, probably. I need to look up the roots, but yeah, it's like, what is all hands? People go to church every Sunday. All hands every week, same thing.

We used to have a thing with our all hands that Dharmesh and I wanted it to be so inspirational that people would well up or cry during the all hands. It's like we really, really worked on our all hands.

Nothing. I don't think anything wrong with that.

Yeah.

No. Okay.

Thank you for coming on the pod. Thank you for building Notion. Thank you for being inspiration for tons and tons of founders.

I'm glad. Hopefully it'll be helpful for others.

Appreciate you.

Thank you for your time.

Okay. I hope you liked that episode with Ivan. One of the things I like about him, there's a famous quote by Oscar Wilde, be yourself, everyone else is taken. I like to think I am myself, like I'm pretty quirky and I've embraced that quirkiness. And I think at the end of the day, companies really reflect those CEOs. And I don't think CEOs should be afraid to really be themselves and kind of build the company around them. Ivan's really done that nicely. That might be a good plan for you too. The second kind of takeaway I had is, you know, I work with lots of startups and there are so many companies, let's say less than $500 million in revenue growing like 30%. They're kind of stuck and there's infinite numbers of stuck companies out there. If you're in that boat, I'd recommend a refounding moment. And the refounding's harder than it looks. It typically involves like A big step back and 2 steps forward. It's going to be hard. Your numbers will look worse in the short term. Ivan didn't do this, but when we wanted to do a refounding at HubSpot at one point, we started a new company inside of HubSpot that was completely independent from it. And that served us well. That's how Apple did it back in the day. But if you're stuck, and a lot of companies are stuck, be risk-on and Do what Ivan did. Like, he was a ye olde SaaS company and now he's a rocket ship AI company. I think he's onto it. The last takeaway I have on Ivan kind of starts back in a podcast interview I did with Jack Dorsey a few weeks ago. And it does seem to me there's a new way to build and run companies today that's a pretty big departure from the way people have done it the last 30 years. Jack's iterating on it. Ivan's iterating on it. A lot of the, call it vintage 2025 startups are iterating on it. And this is something I'm thinking a lot about. I think there needs to be a new playbook on how to be a CEO in AI native in the kind of era we're in. And I'm early in the iteration, but just roughly the way I kind of think about the way they're organized is historically there is a triangle-shaped org chart. Those org charts have been around a long, long time since the Roman Empire. They're a very inefficient way to run a company, but they've been the best way to run a company because there's been no better one. I think the problem with them is the bigger that org chart gets, the more that information gets distorted across and up and down and the slower it gets. And so it's pretty inefficient. The new way that Dorsey described, and I didn't quite get into it with Ivan, but I suspect it's similar, is it's a circle. And in the middle is all of the context in the AI system. And initially, humans are making all the decisions, but over time, as you give that kind of centralized AI system more context, it gets smarter and you're feeding it context and you turn over more and more of the decisions to them. I don't think it happens overnight. I think it's gradual, but it's an IT task to get it right. You have to be legible. I don't love that word, but you have to have a legible set of systems. You have to kind of record everything. But I think this is the new way. Companies who are doing this seem to be just moving a lot faster than the companies that aren't. And Ivan is moving at breakneck speed. And I think there's a lot of things that fall out of it. They don't need as many people. They move much faster because of that. They have much shorter planning cycles. All of those kind of one-way doors that Bezos used to talk about are really two-way doors because nothing takes that long to do. Anyway, I think there's this new playbook I'm interested in. I'm going to be talking about it on the podcast and on X. If you're interested in it too, hit me up on @bhalligan.

Thanks for tuning in.