Nextdoor Sees Brexit Opportunity to Expand Network for Neighbors

  • Startup expands social network to U.K. after Dutch opening
  • Nextdoor has raised more than $200 million from investors

Social networking startup Inc. is expanding to the U.K., saying Brexit created an opportunity for the company’s neighborhood-focused service by highlighting British concerns about a loss of community spirit.

The six-year-old company, which has raised more than $200 million from Silicon Valley backers, is attempting to distinguish itself from larger social networks like Facebook Inc. and LinkedIn Corp. by focusing on smaller, local communities. Neighbors use the service to post recommendations on plumbers and mechanics, gossip about local crime, scout for babysitters or sell old furniture.

The U.K.’s vote to leave the European Union reflected Britons’ sense of alienation from their communities, exposing concerns about immigration and identity. Nextdoor, which became available across the U.K. on Wednesday, said it aimed to help them reconnect.

“Brexit has made explicit the implicit tension that has been simmering in the U.K.,” Chief Executive Officer Nirav Tolia said in an interview. “Research suggests that the way we make progress on these issues is to reconnect with your local community.”

Looking Abroad

Tolia said the success of the U.K. rollout will help determine how quickly the company expands globally. If adoption is fast, Tolia said, the company may raise additional money to fuel growth. The firm still has about half the $200 million it has raised from venture-capital firms including Benchmark since 2010, he said.

Nextdoor, which is based in San Francisco, previously expanded to the Netherlands, the first market beyond its U.S. base. More than 3,000 Dutch neighborhoods, along with 112,000 in the U.S., have created Nextdoor networks.

The service differs from broader social networks because membership and use are limited to local residents and participants must verify where they live. Municipalities and utilities use the site to share information, and Nextdoor is beginning to experiment with advertising as a way to make money.

The company has faced criticism over accusations that it abets racial profiling when users post messages warning that someone suspicious is in the neighborhood, describing the person by skin color. Tolia said the company had reduced the amount of offensive material by putting protections in place, including algorithms that screen out such language.

In the U.K., where the Brexit vote was followed by a surge in racist and xenophobic incidents, Nextdoor will tweak its algorithms for local concerns, Tolia said. The company, which employs about 150 people in San Francisco, says it will initially have three full-staff members in the U.K.

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