Nextdoor, the neighbor-to-neighbor social media platform, is growing fast -- and especially fast for having a yet-to-be-determined business model.
Even in a slow walk through suburbia it’s easy to miss. But "being neighborly," whether it's for "common hospitality" or passing salutation, carries weight and has long embedded itself in America's urban landscape. Yet now our next-door relations may be taking on a new role with a name it's never held — or at least, not until recently.
Sarah Leary uses the term, "social network." It’s the framework Leary has affixed to it since she and fellow co-founders Prakash Janakiraman and Nirav Tolia first conceptualized Nextdoor, a neighbor-to-neighbor social media platform that’s grown at breakneck pace since its start in 2010.
The trio met through work at the consumer reviews platform ePinions — now acquired by eBay — and have adroitly cultivated Nextdoor into a platform that’s expanding almost exponentially. Just look at the numbers: company statistics show Nextdoor’s influence has grown from 176 neighborhoods to more than 38,000 today -- that number represents one in four neighborhoods throughout the U.S. The amount of Nextdoor neighborhoods doubled last year and the same growth pattern is expected to continue, Leary said. The network is likely to span the entire U.S., all of its 150,000 or so neighborhoods, in the next two to three years.
With such an upswell, cities have taken note and have already green-lighted departments to leverage Nextdoor for neighborhood notification purposes and dialogues. Most are using the service for police and other emergency management agencies: 212 and counting. For government, the emerging startup raises questions about sustainability, its business strategies and — if integrated into workflows — how best to apply Nextdoor’s high-touch access to citizens.
The idea for Nextdoor took root in the summer of 2010. The epiphany came to the founders more from what was absent in American neighborhoods than what could be added.
“I walked out my front door and realized that I only knew one person that lived on my block,” Leary said.
It was a simple observation, but one all three of the founders recognized in their own neighborhoods and social circles. They found they were not alone either. With research, the trio discovered the nation has gradually turned more isolated. According to the Pew Research Center, 20 percent of Americans can’t name one of their neighbors. Harvard Sociologist Robert Putnam has shown compelling evidence in his book, Bowling Alone, that America’s disconnection within communities has only increased.
“This was something that inspired us to say ‘Gee, can’t we use technology to bring back a sense of community to the neighborhood?,’” Leary said.
Social media giants like Facebook, Twitter, LinkedIn were connecting people together through established social circles and through personal interests, but the team realized nothing existed to connect people living right next door. Noting the gap, the three drew on their ePinion’s platform experience to test a network that would connect residents. First a resident would verify their address via a postcard sent to their home or through an alternative methods like a credit card, phone number or the last four digits of their social security card. Once approved, the Nextdoor team would give the resident access to a Facebook-styled dashboard linked to neighbors. The program was a success in their first experiment in Menlo Park, Calif., which led to a series of similarly successful trial runs across the U.S.
The network’s promise enticed major investors such as Benchmark Capital, Greylock Partners, Kleiner Perkins Caufield & Byers, Tiger Global Management, Shasta Ventures and others from Silicon Valley to back the startup at more than $100 million.
It may seem peculiar for a startup to gain such robust support without a business model. Yet Nextdoor falls into this category. Officially, there’s no business plan to chart paths of revenue or estimate ROI. However, the absence hasn’t fettered investors or halted jurisdictions from jumping in.
“It was not just Facebook that followed a model that basically said: ‘Grow users, expand engagement, and then work on revenue generation,’” Leary said, and explained the strategy has been employed by Google, Twitter, LinkedIn and others before hitting the mainstream.
“It’s kind of the playbook for consumer internet companies — and while there might be some skepticism for traditional companies — it makes sense for consumer Internet because what you’re trying to do is build audience and that’s something that just takes time to do,” she said.
And time is a luxury for Nextdoor. Leary wouldn’t go into details, but said the vast majority of seed funding is still in their bank account, enough to allow the company to consider its options. The San Francisco based company now has roughly 100 full-time employees and is growing. In July, Nextdoor hired its first Chief Business Officer Christa Quarles, previously at Disney Interactive, to develop its financial strategy.
Leary said the company aims to experiment with a few methods to monetize the site. At present, 26 percent of Nextdoor neighbor discussions center around recommendations for local service providers, 14 percent focus on personal classifieds and another 11 percent on events. All three of the categories could, if desired, be easily monetized with advertising, Leary said. The other three major discussion areas are crime and safety at 20 percent, community issues at 22 percent and “other” issues at 7 percent.
“We think there is an awesome opportunity to connect local businesses and service providers with residents in a smart way” Leary said.
While their business plan evolves, growth is the focal point. And for a company with such a targeted set of user demographics, the common question is how to draw users beyond simple word of mouth. Massive online advertising was tried, and was somewhat effective. However, Nextdoor’s ample growth is attributed to its connection to community stakeholders. Leary calls them natural neighborhood leaders, people who are direct contacts with neighbors, government decision makers or non-government community organizations.
The company has hired “city strategists” tasked with building community partnerships. Job qualifications for the position include partnership development with police departments, mayors, city managers, crime watch groups, emergency preparedness groups and parent groups — among others.
“We are investing for the long haul here,” Leary said of their growth campaign. “You don’t raise $100 million to just build this and flip it. We’re trying to build a great company that’s going to be around for decades and decades to come.”
Engaging government was never part of Nextdoor’s original equation. The choice to include agencies and departments came entirely from the Nextdoors’s users, who asked for it, Leary said.
“One of the things that emerged through all of this, was a whole host of conversations around crime and general safety and…it wasn’t obvious to us two years ago that [government interaction] was going to be an important part of our service and even as part of our growth plan.”
Yet users inquired how cities — and specifically their police and emergency management services — could be integrated in the platform. Thefts, break-ins, home fires, wild fires, gas leaks, noise violations and more were all part of Nextdoor’s crime and safety discussions. The users, Leary said, began reaching out to their teams to connect the dots.
“That really was the birth of the entire platform that we built for city agencies,” she said.
The problem at the time was the platform bounded neighborhoods by mapped perimeters. If site users didn’t live within the neighborhood boundary, they couldn’t access the conversation. This included government. So a remedy had to be built. What developed was a customized dashboard specifically for departments, allowing them to share relevant information with neighborhoods, target one or many areas for announcements, while simultaneously, measuring a department’s impact on a neighborhood with interaction metrics.
To maintain privacy for residents, Leary said officials can see dialogue from their own comments and posts, but can’t see neighbor-to-neighbor conversations. It was a feature highly sought from agencies, who didn’t want to be inundated with excessive dialogue or required to reproduce resident’s personal conversations through Freedom of Information Act Requests. Since the launch, the dashboard has enabled police to solve crimes and agencies to engage residents outside of government’s typical 8-hour days. Most notably, in March, San Francisco’s Department of Emergency Management used to the service to provide real-time updates for a five-alarm fire that struck the Mission Bay neighborhood.
“We now partner with 212 agencies across the country and this is everything from the Mayor’s Office in Pittsburgh, to the police department in Dallas to the Mayor’s Office in Los Angeles,” Leary said.
Jurisdictions use Nextdoor most often for crime prevention and community policing activities. This is followed by community engagement efforts, such as city events, budget feedback and local construction projects. The third most common use is for times of disaster and to aid disaster preparedness. Agencies typically adopt Netdoor after one department admires a successful use and ends up following suit.
Right now, the government dashboard can be created in as little as two days with ongoing engineering efforts underway to expedite the process further, said Leary. Coming in the next few weeks, Nextdoor plans to unveil an updated version of the dashboard that boasts a variety of new and useful features.
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