Last fall, I wrote a short blog post about the “chaos in consumer productivity.”

The market for keeping life organized isn’t so orderly.

Last fall, I wrote a short blog post about the “chaos in consumer productivity.” In it, I highlighted the intense competitive jostling that had been happening in 2013, mostly in the note-taking and task management markets. Looking back, I realized that it was actually an even more eventful year than I thought — and it hasn’t slowed down. Partially for my own benefit running Fetchnotes, I wanted to compile an in-depth analysis on the state of the consumer productivity software industry as of April 2014. Again, I’m mostly interested in the notes/tasks space — there’s a LOT happening in calendaring, documents, etc. that I don’t know nearly as much about.

6 acquisitions/shut-downs of funded companies since January 2013

The most interesting part of 2013 was how many large players were removed from the marketplace. I estimate about 10 million people were affected.

Astrid

4M users, $1.9M raised in 2012 led by Google Ventures. Acquired by Yahoo and shut down in August 2013.

Catch Notes

3.5M users, $9.3M raised from Excel Venture Management. Mysteriously shut down in August 2013, later came out they were acquired by Apple.

Orchestra/Mailbox

Unsure of final user base size, but was once one of the most popular to do list apps for iOS. Raised $5M from CRV, Kapor Capital, CrunchFund, SV Angel and others. Pivoted to Mailbox and acquired for $100M by Dropbox in February 2013, shut down Orchestra in September 2013.

Well

No public user figures, but raised $1.1M from PivotNorth Capital, Venrock and others. Hasn’t technically shut down, but the last update was in March 2013 and several team members now appear to be working on something called Lootsy according to their Twitter profiles.

Do.com

Previously Manymoon, acquired by Salesforce for $25-35M in 2011. Raised undisclosed amount by Harrison Metal, shut down in January 2014.

Donna

Produced by Incredible Labs, acquired by Yahoo and shut down in February 2014. Raised $2.5M from Khosla Ventures, Betaworks, CrunchFund, Ashton Kutcher, and Maynard Webb.

That’s 10 million people in a relatively short period of time suddenly looking for new tools. Those users are signing up for the remaining players, which is sowing the seeds of consolidation in an incredibly fragmented market. Mass movements like that are very rare, and it wouldn’t be the first time a fragmented industry suddenly consolidated into one giant (Google with search and Facebook with social networking).

Major Fundings

• Any.do raised another $3.5M, led by its $1M first round investors Genesis Partners, Innovation Endeavors (Eric Schmidt’s fund), Blumberg Capital and Felicis Ventures in 2011 (after launching their first app, Taskos, in 2010). Any.do reportedly has 9M total users as of March 2014.
• Wunderlist raised a $19M Series B by Sequoia Capital ($23.9M total), after starting out in 2010. Wunderlist reported having 6 million users in November of last year.

We didn’t beat our chest about it, but Fetchnotes had some funding too. ☺

Major New Entrants, Pivots, Expansions and Relaunches

• Any.do released Cal, showing its plans to become a “productivity suite.” They seem to be prepping the release of an email and notes app soon, according to the bottom of their website.
• Google announced Google Keep.
• Simplenote showed it’s still relevant with a new update (they had about 750K last year, I wouldn’t be surprised if they crossed 1M).
• Todoist announces Wedoist.
• Teuxdeux relaunches.

Other interesting new products I’m watching…

• Carrot
• Vesper (by Jon Gruber)
• Checkmark
• Upword

So where does that leave the consumer market for “keeping track of stuff”?

Primary Players (5M+ total users)

• Evernote (80M users)
• Microsoft OneNote (it comes with Office, so who knows how many people actually use it, but it’s Microsoft so they get included)
• Any.do (9M users)
• Wunderlist (6M users)
• Remember the Milk (5M users)
• Google Keep and Google Docs (no idea how many users, but it’s Google)
• Springpad (5M users)

Active Secondary Players (above 100K but less than 5M total users)

• Fetchnotes ☺
• Clear
• Anylist
• Todoist/Wedoist
• Things
• Simplenote
• Teuxdeux
• Finish
• Carrot
• Vesper
• Toodledo
• Workflowy (more of an outlining tool, but a lot of people use it for lists)
• Trello (also more of a collaboration product, but a lot of people use it personally)

I’m sure I’m missing a few, and especially in the second group I had to do some guess work about user bases (why I left them off). It’s also really hard to make comparisons, as you never know when they’re reporting registered or active users. More importantly, the category lines in this space are really blurry, and it’s often hard to pin down the “right” label for a product —is it a task manager or collaboration tool? Notes app or to do list? Consumer or enterprise? The answers usually aren’t clear.

Feel free to comment on any you think are relevant that I may have missed.

Observations

The challenge of free

With the exception of Remember the Milk (which had the benefit of being one of the first entrants in 2004), the primary players were all venture-backed, free and the core focus of the company (or of a team within a large company). To achieve scale, you need to be free or freemium. To achieve scale with no revenue, you need funding/resources. To raise money, you need to go all in.

There are a handful of companies that defy these rules and get into the hundreds of thousands, or rarely even into the low millions of users, but they never break out. There’s nothing wrong with that, but I think the market is large enough and the behavior ubiquitous enough that a Facebook or Google is going to happen.

“To do list” and “task management” apps have a low ceiling

There is a highly concentrated and avid group of “to do listers” that will adopt these products, propel them to the hundreds of thousands of users, or in a few cases to the millions. That market is growing, mostly driven by the widespread adoption of smartphones and simplification of interfaces.

At the same time, not a single one of those products, at least as of last year, has more than 1% penetration on US iPhones.

There’s a relatively defined “playbook” (in terms of features and approach) for building task management software that will get you a few hundred thousand users, if not several million users, but they don’t get much bigger. They seem to just be trading the same ~25-50M people total that think in a way conducive to a task manager — organized, structured, and caring deeply about their personal productivity. I don’t think it will ever be mainstream, and you’ll always have an upper limit on how many people actually do task management (hint: it’s not as many as you’d think). This only really matters for venture-backed companies, as their investors expect them to be worth $1B+. I just don’t see that happening.

Now, which is the only company (Google and Microsoft notwithstanding) on that list that has broken out of the single digit million range? Evernote, a notes app (already worth over $1B). I think it’s because they start with a basic unit — notes — that’s more in line with the unstructured, “dump it down” behavior most comfortable to people. There are just more people that feel a need for a tool to “jot things down” than there are people who want to “manage their tasks.” By and large, flexible, swiss-army knife tools and methods win out in the mainstream market.

Here’s that same Google Trends report for “to do list app” (red), but this time I’ve added the search trends for “notes app” (blue).

Post-publishing edit: I dug in some more and noticed if you change some of the keywords around, you might get different results. There are other supporting reasons supporting my conclusion about to do list apps, but I wanted to make sure I highlighted this so I didn’t get called out on it later ☺

Despite all that activity, the current leader in this market is actually none of these companies. It’s whatever comes with your phone, texting/emailing yourself, or just pen and paper. When you talk to the average person, they’ve never heard of any of these products.

So, where does that leave us?

I think the three biggest areas of innovation that will happen in consumer productivity software are going to relate to integration, collaboration, and intelligence.

Integration

Just think about the number of productivity tools you use on any given day — calendars, to do lists, notes, documents, email, and you could even argue messaging apps. Aside from a few exceptions and basic integrations, they mostly exist as silos. I think the future will be about piping these tools together, if not merging some of them into one product we haven’t yet imagined.

Collaboration

So much of what we do involves other people — shared shopping lists, vacation planning, school projects, etc. At the same time, collaboration tools have not yet found a way to crack the consumer market, and most of this information is still happening in messaging/email. Collaboration is also often what drives people to adopt tools for keeping track of information, but they usually don’t translate well to single-player mode. Someone’s going to figure out how to strike the right balance.

Intelligence

Everyone seems to sprinting to win the race for being the best way to keep information organized. In the process of doing so, however, you capture incredibly rich data about people — the books they read, the people they call and email, when and where they go grocery shopping, even the ideas and quotes that inspire them. You can use that data to do so much more than empower procrastination, but few people really seem to be doing anything about it.

Being a great way to stay keep track of information is no longer a unique value proposition — it’s a requirement. The next generation of productivity tools are going to be about making our information better, not just better organized.