How Obsidian Thrives with 3 Engineers, No Funding, and No Meetings at a $350M Valuation

The Small‑but‑Mighty Model

Obsidian, one of the most influential local‑first Markdown note‑taking applications, boasts a valuation of $350 million despite having only three full‑time engineers and a total staff of seven (including a CEO, two co‑founders, a support person, and a cat). The founders, Erica Xu (COO) and Shida Li (CTO), both Waterloo alumni, started the first beta in March 2020 while isolated during the pandemic, dissatisfied with existing note‑taking tools and building a fast, offline‑first, plain‑text solution.

Rejecting external capital, Obsidian funds its operations entirely through user‑paid premium services such as cross‑device sync, publishing, and commercial licensing. This cash‑flow independence lets the team avoid scaling pressures, bloated features, or data‑selling practices; their only "boss" is the daily user base.

Ramblings Channel: A No‑Meeting Culture

With no large group chats, each team member has a personal "Ramblings" channel where only the channel owner can start new threads, others reply within threads, and the channel is muted by default—eliminating interruptions and preserving deep‑work flow. The channel mixes work topics (code ideas, debugging help) with personal moments (child‑care anecdotes, travel photos), fostering a tea‑room‑style social temperature while maintaining alignment without formal meetings.

All task planning, PRDs, roadmaps, and checklists are stored in a shared Obsidian vault, while code reviews happen on GitHub, and casual chats remain in the Ramblings channels.

Plugin‑Driven Extensibility

Obsidian’s core strength lies in its extensibility. Inspired by Visual Studio Code, the app offers a powerful plugin system. The community now contributes thousands of open‑source plugins—calendars, kanban boards, mind maps, and AI integration modules—forming a volunteer "external engineering army" while the core team focuses on text rendering, performance, and core APIs.

Obsidian vs. Notion

Notion epitomizes cloud‑first collaboration, storing data on its servers and offering an integrated, subscription‑based AI assistant that requires users to expose all content to a proprietary model. In contrast, Obsidian stores notes locally as plain‑text .md files, guaranteeing data sovereignty even if the company shuts down. Users can add AI via community plugins, choosing between hosted APIs (ChatGPT, Claude) or self‑hosted models (Ollama) that run offline without transmitting data.

The article ends by asking readers which philosophy they prefer: the cloud‑centric convenience of Notion, the privacy‑first, extensible approach of Obsidian, or a hybrid of both.