Notion is a Denver-based smart home security startup that has raised $16 million in funding following a solid crowdfunding campaign on Kickstarter. Notion’s small sensors can be placed near doors and other locations around the house to monitor motion, temperature, water leaks, etc. To learn more about Notion, I interviewed CEO Brett Jurgens.
Jurgens told me that he and fellow Notion co-founder Ryan Margoles are both Colorado natives. Jurgens said he was born and raised an hour outside of Denver in the city of Longmont, Colorado. And when Jurgens was between the ages of 11 and 12, he became a back-to-back World Yo-Yo Champion. Several years later, he went to school at the University of Colorado Boulder where he studied finance and real estate.
Jurgens started out his career as an analyst in the Private Placements Group at the investment bank Piper Jaffray. In that group, Jurgens and the team helped private, growing companies raise $20 to $100 million from venture capitalists and strategic investors. Jurgens pointed out that he used banking as a stepping stone to becoming an entrepreneur as he worked at Piper between 2007 and 2009. “As many I’m sure to have tried to forget, that was a really hard time to raise money. The experience taught me a lot about which companies were surviving and which businesses and teams were being funded, even in the toughest of environments,” said Jurgens.
After that, Jurgens was hired as the first employee at Denver-based pharmaceutical company UrgentRx where he ran business development and operations, launched 6 products and expanded into more than 30,000 retail locations. Jurgens referred to this experience as “entrepreneurship on training wheels.”
Jurgens and Margoles have been best friends since they were 4 years old. And they knew they always wanted to go into business together, but it took awhile to find the right idea. “All it took was a frightened puppy and a beeping smoking alarm,” Jurgens quipped.
One day while Margoles was at work, a smoke alarm in his house started to beep due to a low battery. Margoles’ golden retriever puppy Apollo was not a fan of that noise so he ended up coming home to a total mess.
"After calming Apollo down and changing the smoke alarm battery, Ryan called me up and said, 'Brett, this is the one,” Jurgens recalled. “A smoke alarm that alerts you when it’s going off, no matter where you are, and smart enough to know if there’s an emergency! Because what good is a smoke alarm if no one is around to hear it?' Note: these were the days before Nest Protect or other smart smoke alarms."
Around that point, the two of them started talking to anyone who would listen. They ended up interviewing about 150 people and learned that consumers rarely buy smoke alarms, the alarm they had in mind to build would likely sell for $150 (compared to $15 for a basic alarm at Home Depot) and they would have to go through a lot of safety tests before selling their alarm to prove it worked. But one of the most important takeaways from surveying the respondents was that people really wanted to know about their alarm going off when they weren’t home.
In the first iteration, they decided to build a small device that could just hear the alarms that people already had. Once this idea was proposed, then people started suggesting ideas for a small device that could monitor doors for home security, water leaks, gun safes, liquor cabinets, elderly parents still at home, vacation properties, etc.
As part of the second iteration, they knew the whole home was the opportunity but different people at different stages in their lives wanted to monitor different things. “Could we make a single, small, extremely smart, multi-function sensor that could monitor all of those things at the same the time, providing a user experience that would be empowering and comfortable for any user? Yes! And we thought we could be price competitive too,” Jurgens exclaimed.
After that, Margoles started to prototype an initial sensor but quickly realized the complexity of the idea — which would require a more experienced hardware/firmware engineer. “We got lucky and through a former colleague of mine, we found our first employee Sean, a brilliant engineer who had over 25 years of experience and was looking for his next adventure,” Jurgens acknowledged. “Ryan and I paid him for six months with the goal of building a functional prototype. We all agreed that if our customer research and Sean and Ryan’s ‘building’ produced great results in that six-month period, Ryan and I would quit our jobs and dedicate our full efforts to Notion.”
It was in February 2014 that both of them started working at Notion full-time. Shortly after that, they were accepted into the Techstars accelerator program, raised a pre-seed round, launched a successful Kickstarter campaign to broaden their understanding of consumer interest and to help fund the idea, brought on a head of software to develop mobile apps and backend data platform and started production at a local Colorado-based manufacturer.
Notion was accepted into Techstars in Boulder as part of the 2014 class. There were four people in the company when they applied. The decision to be a part of Techstars in Boulder was because they knew they wanted to build the company in Colorado. During the first month — which was known as Mentor Madness at Techstars — the Notion team met with 150 mentors in a single month. “They dug deep into our idea, business model, technology, user experience, team and everything else you could imagine, to push us to think through how we could be better,” Jurgens reminisced. “In the second month we worked on product and customer development, and in the final month we launched a Kickstarter campaign and pitched our company at Demo Day.”
After Techstars, Notion applied to MetaProp, the leading real estate-focused accelerator. Notion was accepted as part of the first cohort in 2015. The main goal was to expand their network into all types of real estate and to better understand if we could help monitor much larger properties. As a result, Notion saw big opportunities with builders, real estate agents, multi-family owners/operators and others.
One of the lessons that Jurgens learned in this process was that having a “functional prototype, even if it’s ugly, will really help you validate interest from consumers and investors.” He encourages entrepreneurs to not be afraid to get their ideas out there to be tested. Notion was also about a year late shipping their Kickstarter campaign, but they learned a lot about how to continue communicating with their backers and respect them and their support. And Jurgens said that this experience also set the tone for their company culture.
Jurgens is also proud of working with a Colorado-based partner as it was extremely helpful. “Going overseas early on would have been much more expensive and difficult,” he explained.
Notion has also partnered with a number of insurance companies to reduce claims, decrease customer churn, differentiate offerings and to provide an outlet for frequent and positive engagement with their policyholders. According to studies, people are open to investing in Internet of Things and are willing to switch insurance carriers if they are eligible to receive policy discounts for installing home security products. As a result, Notion is partnering with insurers that are eager to capitalize on consumer intrigue of the Internet of Things devices to get new customers, offering smart home technology as a competitive advantage that at the same time enables a provider to maintain positive engagement with its policyholders.
“In addition, Notion’s ability to collect and analyze large amounts of data about how people engage with their homes has the potential to change the way properties are protected and insured. The true opportunity for IoT to reduce loss and predict behavior becomes more definable through mass adoption and more data,” Jurgens mentioned. “Defining and building this data platform is something we are hard at work on to the point where one day it could very well become a requirement to have certain smart home technologies installed in your home to get insurance coverage.”
Some of the enhancements that Notion has made since the public launch in 2016 include performance and reliability improvements in the second generation of the device. And there is a major focus on integrations with partners like Nest along with the insurance companies and others.
The first version of the Notion sensor had a coin cell battery that did not last long enough and was not a common battery, making it challenging to replace. And so the second generation is now powered by two AAA batteries -- which gives the Notion sensors a 12-18 month battery life on average. The communication between the Notion sensors has been improved and the bridge (hub) range has increased up to 50%. Plus the second generation has been updated with an IP67 rating to make it fully protected from dust and makes it able to withstand up to one meter (about 3 feet) of water submersion for 30 minutes. And with Nest integration, it makes the information that Notion provides more actionable. Homeowners can monitor the temperature activities across their entire home, not just the hallway where their thermostat is installed.
For example, one of Notion’s customers said that she placed the device on her front door to know when it opens and closes. And she added the temperature task because it was an option. “Over time, she started getting alerts that the sensor had detected a drop in temperature, and eventually realized this was happening because the weather stripping on her door had deteriorated. Notion helped her identify the problem and she replaced the stripping on her door. As a result, she saw her monthly energy costs go down, so Notion helped her save some money in the process too,” Jurgens highlighted.
Another interesting customer success story is about a man named Chris in Maryland. He is using Notion primarily as a temperature detection system to keep his five pet chinchillas comfortable especially when he is out of town. Chinchillas are extremely sensitive to temperature. “He’s had Notion for a while now, and twice since installing his system, Notion’s temperature threshold feature alerted him to an HVAC failure. In both situations, once when Chris was on other side of the country, he was able to send someone to his home to move the chinchillas to a cooler, safe location and have the system repaired very quickly,” Jurgens recounted. “He told us Notion saved the lives of his pets, and lets his family rest easy while away from home.”
So far Notion has partnered with six of the top 10 property insurers in the U.S., amongst others. Notion has also seen really high installation rates and the company has delivered more than 8 million “peace of mind messages to homeowners” since launching.
There are a number of people using Notion to monitor water leaks in the home. And every time Notion detects a water leak, the company sends out a survey to the system owner to determine what caused the leak and what action the homeowner took, and whether or not an insurance claim was filed. “Of all leaks Notion has detected, not a single person has filed an insurance claim. Notion has effectively helped homeowners mitigate water damages in 100% of those cases, saving homeowners over $1 million to date. That’s pretty incredible, and just the tip of the iceberg as water is by far the biggest threat to homes, causing $10 billion in claims annually,” Jurgens added.
What are some of Notion’s future company goals? “In the near term, we’re making a huge push to expand the number of homes Notion is installed in through direct sales and channel partnerships. We’re also expanding our overall product offering beyond hardware into more impactful integrations, mobile apps, data products and services that provide even more purpose and impact for property owners and our partners. We’re also focused on expanding our team in Denver and attracting more of the amazing talent this city has to offer,” Jurgens concluded. “Longer term, we see Notion becoming a requirement for obtaining property insurance. That sounds a bit lofty, I know, but the point here is that we see Notion having such a big impact on helping people protect what they love, that major industries like insurance, home and apartment developers, small business owners and others will start to incorporate and require technologies like this in their properties. Think I’m crazy? Consider the auto industry--seatbelts and airbags did not come standard. As technologies improved, and more importantly as the data to support the impact of these technological advancements proved their value, automakers and lawmakers started requiring the new technology. The same will happen for properties and we plan to play a major role in this transformation.”
