Photo: Courtesy of Notion
Notion, a San Francisco-based startup that’s developed a cult following for its cloud-based collaboration tool, raised $50 million in new funding at a $2 billion valuation.
Why it matters: The entire round happened after the coronavirus pandemic spread to the U.S.
- Index Ventures led the round, and was joined by existing investors.
- Notion says it's been profitable for the past 18 months.
“I think the velocity of how fast this moved is, I think, something nobody could have predicted,” Notion COO Akshay Kothari tells Axios of the company’s decision to raise funding once the Coronavirus crisis hit.
- “I think a lot of potential recruits would want to join a stable company, and a lot of our customers would want to use Notion knowing that it’ll be around for a long time,” he adds.
- According to Kothari, after rebuffing Index Ventures and others for more than a year, the startup called up Index’s Sarah Cannon on Wednesday of last week, and was finalizing the deal by Friday.
- “The Notion team is visionary, the market is the 1B people that use Microsoft Office, and the engagement looks like Slack,” a source familiar with Index Ventures’ thinking tells Axios.
By the numbers:
- Grew from one million to four million user in the last year, and saw China-based user signups grow threefold since the virus pandemic started.
- According to Forbes, the company reportedly has an annualized run rate of $30 million.
- Notion says its latest funding gives it 10 years of runway.
The big question: “I think long term were most likely an enterprise product,” says Kothari. Can a startup that’s entirely grown on word-of-mouth take on enterprise customers?