I feel like Evernote is a prime example of the pains of trying to convert free users to paying users for the same features, something we see in many VC funded software from its era. Once you give something away, it's damn near impossible to take it back, even if you plead your case as honestly as Evernote did.
Evernote was great. Honestly, it was worth paying for. But they gave away the farm too early, and folks feeling like what they had was being taken away from them spurned a lack of trust. Obsidian made the smartest play by giving you the editor, keeping the files outside of a database so that they're portable (so they feel safe if they ever have to move away), and telling you that if you want to own the sync story that you can, but you can pay to have the cohesive experience on every device.
Don't you think having so many competitors offering free notes apps is a large part of it?
He gave the Obsidian example, which is a great one, so no. Obsidian shows you can still do well as a noted app company if you are selling the right thing (sync).
But you can sync your Obsidian notes for free if you use free Dropbox or OneDrive accounts.
This isn't trivial when you start syncing mobile (now you need an extra app, as onedrive doesn't support local), or onto a work device (where I don't want onedrive installed)
There's work arounds (for example I forgot the name, but one plugin allows you to setup onedrive to share just one folder via logging in on each device), but the syncing story wasn't great. Quite a bit of extra setup across all devices, more points of failure etc.
Hence the smart business model, of let us handle it for you for a small cost.