Notion valuation update#
Notion valuation upgrade#

This is exactly what Notion is doing, giving away core functionality, and monetizing collaboration features in the Personal Pro, Team, and Enterprise plans. The new Personal plan is what we would call a “Perpetual Free” plan, which is where you give away the core product for free, and monetize additional functionality separately. In the new model, the Personal Plan, which was $4 per month previously, is now available for free. Let’s compare that to their updated packaging: On the positive side, this strategy helps companies prevent cannibalization of their core offering, but on the negative side, it can inhibit adoption.

Notion valuation upgrade#

The plan allowed unlimited users to access core functionality up to a limit of 1,000 blocks (their term for content units).Īt ProfitWell, we call this is a “Faux Free” plan - you get free access to a product up to a certain level of usage, at which point you need to upgrade to a paid plan. Their old free plan fit into this packaging model as a universal option for both Personal and Team users to try the product. A user could tell which plan suited them within 10 seconds of being on the website. That’s ~80,000 users per employee, making it crucial that a new user can visit the pricing page and understand which package is right for them without speaking to a human.īefore this week, Notion had one of the more empathetic pricing pages I’ve ever seen. Upon raising funding in early April, Notion had ~4 million users and ~50 employees. I believe the same concept of empathy applies to a pricing page, especially if you have a self-service model like Notion. His point is that the best engineers place themselves in the user’s shoes and build with their perspective in mind. In Hackers and Painters, Paul Graham talks about the importance of empathy in designing software, calling it the single most important difference between a good hacker and a great one.

Notion valuation update#

There are deeper implications for Notion and their competitors in the knowledge management space, but before we get there, let’s talk about their old free plan, their new free plan, and what this update means strategically. “The biggest motivation is just capturing market share - getting more people to use Notion.” When asked about the change, Notion’s COO Akshay Kothari said: By giving away their Personal Plan for free, Notion has decided to commoditize personal knowledge management. The update, though seemingly subtle, is actually a big deal. I was planning on writing about Notion’s packaging this week anyway, and then they made an update mid-week! They recently raised $50M at a $2B valuation in a round that supposedly came together in 36 hours.

They use minimalistic, New Yorker style imagery throughout their website to create a hip, whimsical design aesthetic. The all-in-one workspace has been the talk of Product Managers everywhere.

If you’re in tech or follow it closely, you likely know about Notion. Each issue features analysis of a specific packaging case study readable in 5-10 minutes. Good Better Best is a weekly deep dive on pricing and packaging strategies written by Rob Litterst, who helps head up our pricing team.