There’s been plenty of carping about how people spend so much time online, they turn asocial. Now, a San Francisco-based startup, led by an Indian-American, seeks to give the term social media real meaning. The company, Nextdoor, wants users to get to know their neighbours by spending time online.
Nextdoor was born of the idea that the profusion of social media platforms available today had neglected one area in which people spend much of their time in the real world — their neighbourhoods. There were sites such as Facebook for friends and interests, Twitter for news, and LinkedIn for managing professional identities but none for the little world outside one’s home.
Says Nextdoor’s co-founder and Chief Executive Officer Nirav Tolia, “A couple of years ago, when we were thinking about creating a really big company that would possibly impact many millions of people, we looked around at the world of social networks and said, ‘OK, clearly social networks have become mainstream and ubiquitous’. We thought it was actually quite interesting that none of these other big established social networks focused on where someone lived. That was the opportunity we began to pursue.”
Know thy neighbour
According to surveys by Pew Research cited by Nextdoor, a quarter of Americans don’t know a single neighbour of theirs by name but over two-thirds of all adults online use social networking sites.
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NEIGHBOURHOOD NETWORKS A US survey finds neighbours who know each other, look out for each other |
| 93% say it is important for neighbours to look out for one another |
| 67% of homeowners feel safer when they know their neighbours |
| 35% of people who know their neighbours share information about crime and safety |
| 79% of people who use an online neighbourhood forum meet their neighbours at least once a month |
Nextdoor was offered as a platform for neighbours to communicate with each other about everything from availability of babysitters to security concerns in their locality. It has expanded quickly across the US since its public launch a year ago and has raised $18 million from venture capital firms such as Benchmark Capital, Greylock Partners and Shasta Ventures.
Silicon Valley-based Benchmark Capital is Nextdoor’s biggest investor. Bill Gurley, a general partner at Benchmark, also on Nextdoor’s board of directors, says he had worked with Tolia and co-founder Sarah Leary earlier. That’s one reason why Benchmark offered funding even before the startup outlined its plans. “We backed the people and the idea came later,” says Gurley.
Tolia and Leary had earlier launched Shopping.com, an internet shopping comparison service. They had also worked together at Epinions, co-founded by Tolia.
The seven co-founders of Nextdoor started beta-testing their network about two years ago in 176 neighbourhoods of 26 states. Today, Nextdoor serves 6,500 neighbourhoods in all except one of America’s 50 states, spreading almost entirely by word of mouth. Every day, about 500,000 neighbour-to-neighbour messages are generated on the platform.
“People frequently ask me, does this work better in big cities or in suburbs or in tech-savvy areas? The answer is, it works everywhere,” says Tolia. “This notion of connecting with one’s neighbours and the benefits of doing that is a universal one.”
How it works
Each Nextdoor neighbourhood is a closed loop in the area it serves, to ensure the residents’ privacy and security. Members are only accepted after Nextdoor has verified their addresses. The size and area of each neighbourhood varies by its location. In a big city, a Nextdoor neighbourhood could be limited to just a few blocks, whereas it could cover entire townships in more sparsely populated areas.
Nextdoor serves as a virtual chat room, where neighbours exchange referrals on local businesses, buy and sell items or even alert each other about illnesses or crime in their area.
“We have an elderly neighbour who has cancer and is quite frail. She had a security issue and when other neighbours got wind of it through Nextdoor, they came out of the woodwork to offer assistance,” says Bob Thornburg, a resident of Sante Fe, New Mexico.
A user in California, Nicole Perkins, says when a teenager in her area was diagnosed with meningitis, his parents used the network to alert their neighbours, so that other children could get tested immediately. “The ability to broadcast the news very likely saved lives,” says Perkins.
Other uses include quick retrievals of a lost special needs child, and even a duck and a puppy, thanks to watchful neighbours alerted via Nextdoor. In other words, the concept of the neighbourhood watch gone virtual.
Says Tolia, “Many social networks are about status updates, photo sharing, but that’s not what we are about. Nextdoor is about utility, it’s about finding a plumber, selling a used car, learning about a gas leak. It’s about all the things that you’d want to know, given that you live in a particular area.”
In fact, in over 60 cities, including big ones such as Atlanta, Dallas and San Jose, local governments and police departments are partnering with Nextdoor to communicate with their residents. For instance, in Oakland, near San Francisco, members used Nextdoor to alert their neighbours about two young men going door-to-door, posing as salesmen. Police asked one resident to get their photo when they came to her door. With this information, they later arrested the two men and recovered goods stolen from a neighbourhood home, which was reported on Nextdoor as having been burglarised.
Beyond America
Tolia says Nextdoor has also received enquiries from governments in a dozen countries in Europe and Asia, as well as Canada, Australia and the UK. It plans to start expanding abroad in 2013. It recently hired a vice-president for overseas operations.
Nextdoor has no immediate plans to expand to India, but regularly receives messages from Indians familiar with its service asking if it’s available to them. Tolia, who says he visits India quite frequently, believes the Nextdoor concept could work in India, too. “Neighbourhood identity is a big, big deal in India. So, it’s really just a question of when on the roadmap that would make sense for us.”
For now, the company is focused on adoption and improving the product experience for members. Tolia says monetisation is not a priority and doesn’t expect to start the process for at least another year. “We’re not monetising today, but in the future, we believe it will be quite straightforward because there is already a lot of conversation going on that’s around commercial things like recommendations and classifieds,” he says.
Gurley points to the shrinking presence of traditional advertising platforms such as local newspapers and Yellow Pages, which could be targeted at specific communities. Nextdoor is already getting hundreds of requests from advertisers clamouring to go on the network, he says. “People are basically asking ‘can we advertise?’ We’ve just pushed it off to the side. We’ve kept it in the queue but from babysitter sites to real estate sites, all these people are trying to get at very local customers. I’m super-excited about how these will monetise,” says Gurley.
Another advantage of Nextdoor, he adds, is that the communications on the site are of functional utility, with built-in intent, which should lead to better advertising.
According to Gurley, the main competition could come from other big social networks, such as Facebook, if they turned to similar functions as Nextdoor’s, but says he doesn’t see that happening. He also points to AOL, which has local products but “they’re going about things differently than we are; they’re more news-oriented than connectivity-oriented”. The biggest challenge, he says, will be to maintain the quality of the product and user experience at the highest level possible.
The company that started with seven co-founders, including Tolia and another Indian-American, Prakash Janakiraman, now has a staff of 41. It has plenty of room to grow, as there are an estimated 200,000 neighbourhoods in the US. Tolia promises, “A couple of years from now, you will all live in Nextdoor neighbourhoods if you’re in the US.”
EXPERT TAKE: Vish Mishra
Recommendations from neighbours always make a difference, so I think the concept is good. Certainly, for safety and security, neighbourhood networks are very good. One of my concerns is that at least in the US, the notion of a physical neighbourhood is not the same as in India and other countries. Twenty-five per cent of the American population moves every year. But that can also be a plus, because these people will be looking for a new school or church or other services.
People living in a neighbourhood don’t always ask each other for opinion and advice. You talk to friends, people at work or other people you know in your virtual neighbourhood.
Just like any kind of social network, they want to have enough people on the network and enough conversations going and they’re going to find local merchants who will probably advertise their services on their site. They will have competition from Yellow Pages, which have also gone online. But they may not list babysitters — Nextdoor can offer more granular services that Yellow Pages do not.
If they have to monetise, they’ll be more like a Groupon-type model that basically caters to local mom-and-pop businesses and services, local delis, restaurants, not the big national brands. Nextdoor can tell local merchants that ‘we have these 10,000 people who live within a two-mile radius of where your business is located’. The challenge is just like Groupon; they have to have lots of sales people to sell into local markets. I don’t think technology is a challenge for them.
Nirav Tolia was a successful entrepreneur during the dot com days, so he has a track record of building successful businesses. And, Benchmark and Shasta are good investors.
Vish Mishra, venture director, Clearstone Venture Partners & president - TiE (The Indus Entrepreneurs), Silicon Valley
