Onboarding: do we show the whole app or hide it?

When a new user lands in my product, they see everything — every menu, every button, every setting, every empty state. It's honest. It's also completely paralyzing.

I watch session recordings and people just freeze, hovering over the sidebar like it's a test they didn't study for.

The alternative is a stripped-down first-run experience that reveals features only as they become relevant — cleaner, calmer, one clear path. But now I'm curating reality, and the moment I un-hide the rest, the user feels baited: "wait, where was all this before?"

There's a version of this where the guided path is the product and the full app is a reward, and a version where it's just a funnel with extra steps.

Which one have you built — and did your retention actually improve, or did you just move the confusion three screens later?