Mike Isaac

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With Another $21 Million in the Bank, Social Site Nextdoor Launches Version 2.0

The biggest problem facing some of the more private social networks is growth. Or a lack thereof, as it happens. Insular by design, expansion of these networks takes time — a slow, persistent burn.

This is how Nextdoor, the private social network focused specifically on the neighborhood, was built. Users communicate with one another to form tighter bonds around their community, only sharing identity information directly with those inside their area, usually spanning no more than a handful of blocks.

But Nextdoor needs to expand faster, before another startup moves in on its turf (or evicts them, if you’ll pardon the analogy). And the company aims to do just that with Nextdoor 2.0, a revamp of the site with features aimed at jumpstarting growth while focusing on the startup’s strongest areas.

The biggest area of change: Instead of restricting users to their previously cordoned off districts, they’re able to post information to nearby neighborhoods, those bordering the area a user resides in. That’s different from before, where users were made to keep up with the Joneses only in their immediate vicinity.

Philosophically, it’s about crossing boundary lines where it makes sense, and posting information about local activity and goings on with those still close enough to care about it.

“It’s powerful,” CEO Nirav Tolia told AllThingsD, “because it begins to let groups emerge that transcend neighborhood lines.”

From a business and growth standpoint, however, it’s a jumpstart in increasing engagement (in theory, at least). Move folks past just keeping in communication with their closest neighbors, and you increase the potential for engagement and activity on the service itself. Sustaining that just begets more growth, and for a young startup with ambitions as high as Nextdoor’s, growth is good.

But is growth at the cost of the company’s value proposition too much? When I spoke with Tolia in the past about Nextdoor, the biggest selling point on the network was the company’s built-in constraints; it’s more private than Facebook, LinkedIn or Twitter. And it’s supposed to be.

To that point, it’s worth noting that Greylock Partners led a new funding round of $21.6 million, adding managing partner David Sze to the Nextdoor board. Sze’s history involves early work on both LinkedIn and Facebook, helping both companies grow into what they’ve become today. (Shasta Ventures, Bezos Expeditions and Google Ventures all also participated in the round.) Perhaps Sze’s influence, among others, convinced Nextdoor and Tolia that it needed a kick from a growth perspective.

For what it’s worth, Path — another private social network at which Sze is an adviser — also made major changes to its app, all aimed at kickstarting growth and engagement. Perhaps a growth rate that burns too slow isn’t enough in what Tolia described as a “winner-take-all market” such as the one he sees Nextdoor competing in. Move fast, or get usurped by someone even faster.

In that vein, Nextdoor’s 2.0 user interface has seen some tweaking, and Tolia says it has been optimized for mobile phone and tablet use, bringing feature parity across platforms beyond the desktop. We should expect mobile apps sometime in the next year or so, as well.

I imagine that when those apps do come out, they’ll sync up with Nextdoor’s third major emphasis, crime and safety. It’s one of the biggest use cases for those on the Nextdoor network, so the startup is playing to its strengths. Urgent alerts sent through the service can reach users by SMS, and Nextdoor eventually plans to integrate police and fire department notifications as well.

Time will tell on the company’s future plans. My best guess is that after cooperating with local government and now institutions focused on safety, the site will likely aim at other obvious community pillars. Churches? Or perhaps schools?

Whatever it has in mind, it certainly has the money to do it. With upward of $40 million raised and Tolia saying most of that is still in the bank, the company has plenty of room to grow.

We’ll have to wait and see if everyone in the neighborhood agrees.

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