Sarah Friar, the head neighbor who directs Nextdoor to public markets



As a young girl growing up in Northern Ireland during the unrest, Sarah Friar saw bombs raining and the windows of her family home shatter in the explosions.

But Brother also saw the best of human nature. In his small village founded by Quakers fiercely opposed to segregation, Catholics and Protestants lived together despite their differences and the brutal conflict that surrounded them.

“Even with that backdrop, our neighbors – they were still the same people, they were still incredibly involved in our lives, even though they were Catholics, we were Protestants,” Friar said in an interview with the Financial Times. “You could always find ways to be deep friends.”

Now, as the CEO of hyperlocal social network Nextdoor, the 48-year-old is trying to recreate that camaraderie and Blitz spirit, this time, online.

Founded in 2011, Nextdoor has established itself as a niche platform against social media giants, for neighbors to share local news, assess local businesses, and trade goods and services.

Following a boost to pandemic-related engagement and after less than three years at the helm, Friar announced on Tuesday that she would go public through a merger with a company d A special-purpose acquisition backed by Khosla Ventures, raising $ 686 million in gross proceeds and valuing the company at $ 4.3 billion.

But as the business grows, continues to gain favor with Wall Street and the advertisers that generate its revenue, it will also mean overpowering the Keyboard Warriors who tend to twist their curtains and racial profiling when ‘they are behind a screen.

For investors, the question remains whether the notoriously nice brother can be ruthless enough to wring out these nasty neighbors. Her advocates, such as John Hope Bryant, a member of the board of directors of Nextdoor who runs Operation Hope, a nonprofit financial literacy organization, have no doubts: “She is the samurai soldier who walks in elegantly and has the ‘tune to dance, but she just sliced ​​you four ways from Sunday, “said Bryant. “She’s not kidding.”

Born to a district nurse and a personnel manager in Northern Ireland, Friar strove to ‘go out and see the world’. Few CEOs in Silicon Valley, where the myth of the genius founder soars and where outsiders are rare, have a more varied CV.

After graduating from Oxford University, Friar worked as a mining analyst for McKinsey in South Africa immediately after the outbreak of apartheid. She then spent more than a decade as a technology-focused equity analyst at Goldman Sachs in San Francisco after the dot-com bubble and financial crisis.

It was in this role that she met her mentor, Marc Benioff of Salesforce, who was at first furious that she had put a “sell” note on her action. But the two quickly turned to a regular debate on Silicon Valley trends, in good spirits.

When she found herself disillusioned with the financial world after the crisis, Friar called Benioff for advice on whether to join a start-up. A few minutes later, he called her back: “Come work with me. You are going to learn a lot more working with me than in any of these small businesses, ”he said.

His first stint in an operational role, as senior vice president of finance and strategy for Salesforce, was quickly followed by a longer period as CFO of the Jack Dorsey Square payments group.

While in Square, Friar “kept the streets quite satisfied with reliable projections and helped the management team strike that balance by investing in the future as well,” said Vinod Khosla, the billionaire founder of the venture capital group Khosla Ventures which launched Spac on Tuesday. .

“We didn’t always agree, but we had fun looking at that kind of compromise,” he added.

Bill Gurley, Managing Partner of Benchmark Capital and Member of the Board of Directors of Nextdoor, describes luring Friar to the post of CEO of Nextdoor in 2018 as a coup; in fact, his old company’s stock price fell 15 percent at the time. “I remember the day after the announcement, the claim I started getting from everyone in my network was ‘how did you get it?’” He said .

Today, board members describe Friar as a skillful communicator and intense workaholic; one described being bombarded with very detailed briefings and reports from the council almost daily. Others have said that she is a leader without an ego, a rare quality among the typically macho tech elite.

Nonetheless, the bet on the recent Spac boom was bold. Friar argued that the Spac process was simpler, shorter and more predictable than an initial public offering. She spoke to about eight different Spacs, she said, but chose to partner with Khosla for her “scale” and “brand.”

T Rowe Price Associates, Soroban Capital, accounts advised by Ark Invest, as well as existing investors Tiger Global all participated – and Friar has her own skin in the game, putting what she described as a “significant” amount. in the private investment in public funds.

According to the investor presentation, Nextdoor’s community of approximately 60 million verified users generated revenue, mostly from advertising, of $ 123 million in 2020, up almost 50% year-on-year. the other. The company is forecasting a similar growth rate this year of 44%. Nonetheless, the company remains in deficit, with net losses of $ 75 million last year expected to reach $ 103 million this year.

The shift to profitability will depend on the ability of Nextdoor’s promise of hyperlocal targeting to attract brands, many of which are focusing their ad investments on the Facebook-Google duopoly. Several senior advertising agency executives, as well as analysts, told the FT the platform was not on their radar. Brother promised to mature the company’s advertising offer.

Meanwhile, Friar continues to grapple with the brand’s security concerns, and it is no irony that Nextdoor has chosen to list under the ticker symbol $ KIND. Pressed by concerns that parts of Nextdoor remain a cesspool of bad behavior and misinformation, she came up with the same refrain that Facebook CEO Mark Zuckerberg has made following numerous moderation scandals: “Look, we are not perfect. “



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