What the system does for a user
Functional requirements are what the system does for a user. Listing them is easy. Cutting them is the skill, and you will want to avoid it, because cutting feels like admitting you cannot do the rest.
It is the opposite. “Design Twitter” contains posting, timelines, follows, search, trends, direct messages, notifications, media upload, ads and moderation. List all ten and start building, and you have guaranteed that nothing gets designed properly. Say instead that you will do post a tweet, follow a user and load a home timeline, and treat the rest as out of scope unless they want one back. The problem is now finite and you have shown you can prioritise. Interviewers almost always accept the cut, and when they do not they tell you which one they want, which is information you did not have a moment ago.
Pick the ones that stress the architecture. Home timeline is the interesting choice in Twitter because fanout is the hard problem. Pick profile editing instead and you spend the hour on forms. In a chat system, message delivery and presence carry the load and group administration does not. Ask which feature, designed well, would make the others fall out, and keep that one.
Writing them down
Write each journey you keep as a sentence about a user rather than a noun. “A user posts a tweet and their followers see it in their home timeline within a few seconds” is something you can design against and test. “Timelines” is not, because it hides both the direction of the fanout and the freshness target.
Who the users are matters too, and whether and whether any of them are special, because it costs you nothing. Twitter without celebrities is a straightforward fanout on write. Twitter with them needs a second path entirely. Surfacing that in minute four instead of minute thirty is the difference between a designed system and a patched one.
Worked example
A candidate is asked to design Instagram. They spend two minutes and land on three journeys: upload a photo, follow an account, and load the feed. Explicitly cut: stories, reels, direct messages, explore, ads, comments. The interviewer accepts and adds one back, comments, because they want to see a second write path.
Then the question that changes everything: are any accounts unusually large. Yes, some have 50 million followers. That single answer means fanout-on-write would generate 50 million timeline inserts for one post, so the design needs a hybrid: fanout on write for ordinary accounts, fanout on read for the few hundred large ones. The candidate spends the rest of the hour designing that hybrid properly and finishes with time to discuss the cutover threshold. The version of this interview where the celebrity question never gets asked ends at minute 35 with the interviewer saying "what happens when Cristiano Ronaldo posts" and the whole design coming apart.