Nextdoor Raises $18.6M From Benchmark, Greylock in First Major Funding Round
Nextdoor, the private social network focused on neighborhoods, announced its first major venture capital funding round on Tuesday morning, raising $18.6 million from Benchmark Capital, Greylock Partners, Shasta Ventures and DAG Ventures, among others.
Fresh from presenting at Allen & Company’s highly exclusive Sun Valley conference earlier this month, CEO Nirav Tolia told AllThingsD that the new funds would be used to continue growing the company over the next four years, with no immediate plans for big purchases.
Nextdoor’s major focus is on the “local,” a concept trumpeted by Benchmark partner and Nextdoor investor Bill Gurley (seen most recently in a well-reasoned post on his personal blog). As Tolia describes it, we use Facebook for friends, LinkedIn for business and Twitter for interests. Nextdoor fills in the smallest and yet most personal of cracks — the neighborhood.
The site is essentially home to thousands of smaller social networks, each one focused on a specific neighborhood (drawn out by Nextdoor using district maps and other publicly available data). Users within each neighborhood can communicate with one another on topics that are most relevant to them, be it a local bake sale or alerting one another to suspicious activity in the neighborhood.
Nextdoor has gained significant traction as an alternative to larger social networks like Facebook and Twitter in the nine months since the site launched. The site has grown to encompass nearly 3,600 neighborhoods across 48 states, while retaining strong user-engagement numbers.
Some of the company’s largest challenges lie in its very structure. It is private by design; new users are only able to join the site after verifying by mail that they live at their stated address. And while the site’s initial growth is admirable, it moves at a snail’s pace by Internet standards. It can’t ride the same viral growth curve as a Facebook or a Twitter, as invites are doled out slowly through word of mouth and direct mail, rather than a wave of Web-based promos.
Tolia isn’t concerned about this, citing it as more of a strength than a weakness. The private, non-spammy nature of Nextdoor’s growth is what draws people to it in the first place. It’s sort of a riff on the Kevin Costner movie line: “If you build it” — and build it privately — “they will come.”
The next steps involve continuing that growth throughout the U.S. and exploring partnerships with interested parties like local governments and businesses. And, of course, the long view has Tolia’s sights set on broader horizons, potentially growing the team to support international expansion in the future.