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Ask the Expert (in a crisis): How to Manage Community in a Crisis

 

July 16, 2020

Max Simkoff: Welcome, everyone, to Ask the Expert, where we ask industry leaders about their unique perspective on how to navigate some of the most difficult challenges faced by the broader real estate and financial services ecosystem during the current global health crisis, also giving you a chance to ask the experts some of the most pressing questions on your mind. My name is Max Simkoff. I’m the CEO of States Title. Today I’m very excited to welcome Nextdoor Chief Executive Officer, Sarah Friar, to talk about the topic, “How to Manage Community in A Crisis.”

To give us a quick bio on Sarah to introduce her before we begin, Sarah graduated with a master’s in engineering from Oxford University, and then moved to the U.S., to get an MBA from Stanford. Out of business school, she spent two years at McKinsey before moving on to Goldman Sachs, where she oversaw their business unit for technology and covered stocks ranging from Microsoft and Oracle to early pioneers of software-as-a-service like SuccessFactors and Salesforce. She brought her extensive financial expertise in-house with that last company. She joined Salesforce as SVP of Finance, and then became the CFO for the leading fintech payments platform. At Square, Sarah helped take the company through IPO and saw their market capitalization increase to over $30 billion. She is currently the CEO of Nextdoor. She also serves on the boards of industry leaders Walmart and Slack.

Despite her obvious success, I think a funny fact about Sarah is that she is still considered a family disappointment because they don’t understand her work — unlike her brother, who is a doctor.

Sarah Friar: I can’t believe he even made it into this webcast. He’s always there!

Max Simkoff: Welcome, Sarah. Thank you for making time for this.

Sarah Friar: Thanks, Max. My pleasure. Great to chat.

Max Simkoff: Let’s just start at a very high level. For those who don’t know – and at this point, I can’t imagine there are a lot of folks, because I’ve actually been spending some time with my parents recently, and they’re on Nextdoor and use it quite frequently – but for those who don’t know, can you just give us some background on what Nextdoor is and how is it different from the most commonly known social network, Facebook?

Sarah Friar: Sure. So for those of you that don’t know Nextdoor, or maybe tried it a few years ago, come back. Nextdoor is the neighborhood hub. We’re there for trusted connections. So meeting people that you probably don’t already know, but have something in common with you, proximity-wise, and also for the exchange of helpful information, goods, and services. So, in other words, if you need to get anything done locally, we’re the place to come to. Nextdoor is a little different from other social networks. So we really use this term, “neighborhood hub.” I would say we’re utility first, and drive to affinity second.

Ways we’re different: We are a little bit of a slower-growth platform because we made a decision right in the beginning that we would verify that you are that neighbor living in that neighborhood. So it’s a little bit of a slower growth model than say, Facebook, where they can take your address book, and immediately, all your friends are connected to their site.

Our founders were actually really taken with a Pew Institute survey that said about a third of Americans only knew one neighbor, and about a third Americans knew zero neighbors, which is very different from how probably the vast majority of us grew up. They really wanted to see, could they bring back that connected community? Could they help build social capital using technology? So that trusted connection was incredibly important. The utility aspect is very different from the graph that a Twitter, LinkedIn, or Snapchat would have. And then finally, just our purpose and why we’re here: To cultivate a kinder world where everyone has a neighborhood to rely on. And man, oh man, the last few months have certainly proven why that is needed in a time of crisis.

Max Simkoff: This “utility first, affinity second,” is really interesting. Actually, I think this is a personal story: I used Nextdoor recently to sell something, a household good that we didn’t need anymore. And it’s interesting – it’s funny how you mentioned, it’s all too common across a lot of the country – but where I live in San Francisco, for whatever reason, it’s more common. Actually, the act of selling something, and then it being hyper-local, like the person who bought it lived right down the street from us, and we ended up actually having a half-an-hour conversation standing in our driveway. It really made me realize that there is affinity that can be created through utility. It was less so us finding a way to connect generally, and a more natural way of connecting through what was a transaction that enabled us to get to know our neighbors better.

Sarah Friar: Then if I tug at that thread for a minute, if you think back to how people were connected historically, they often belong to, say, the volunteer fire department together, or they belong to like the local Rotary Club if they were all in business together. It wasn’t like a strong tie. It wasn’t like your relatives or your best friends. It’s called “weak ties,” if you look at social science. But strong, weak ties are incredibly important to how communities survive and thrive. So it’s exactly that, in some ways, you have to build some social capital. So it might be that someone asked for a recommendation for a hair salon. I haven’t had a haircut in months, but I do need one. That person responds, and then I’m like, “oh, Max, what a nice guy. It was so good of him to give me that recommendation.” Maybe we exchange something on “For Sale or Free. We’ve actually come together and realize down the line that we have very divergent opinions. At least you’re kind of starting from a place of like, Max is not inherently a bad person, we just have different perspectives.

I think there’s not enough of being able to create social capital and create weak ties to be able to have these tougher conversations, which brings us to a lot of what we’re living through today in the U.S., where there’s just not a lot of trust across people with divergent opinions.

Max Simkoff: Well, yeah, and that’s a great transition. I was wondering, how do you build affinity then in local communities where you can have these initial ways of interacting through utility? And certainly, as you’ve mentioned, there’s a lot of discourse in the platform around a wide range of topics beyond just utility. How do you build affinity in these local communities where that is primarily the interaction form? It’s moved almost entirely online.

Sarah Friar: Yeah. Some of it is just about common interests. What we all share, if you’re in a Nextdoor neighborhood, is locale, like proximity. I think right now, we’re recognizing there’s never been more power in the power of local, because we are all sheltering in place. We’re working from home. In my case, I commuted into San Francisco and spent more time in that zone with my work colleagues. Now I’m 100 percent in my neighborhood. Part of building affinity is just starting with something in common. In our case, it’s locality.

From there, it’s looking for common interests. We build things into the product like groups, for example. A lot of groups, if you go think about it, tend to be very local because they usually involve some sort of in-real-life motion. Sports teams are a great example of a group. Book clubs, mothers groups – those actually tend to stay together much longer. It’s another kind of interesting thing about research, that when people try to come together virtually, often the groups don’t stay together in the same way. We have a Groups product as a way to bring people together. We also allow people to follow different topics and interests so that you find like-minded people, maybe dog-walkers nearby.

The other thing that we really try to foster on Nextdoor is civic engagement. If you think how, again, what we have in common is local, there’s often no way to talk to, say, the local mayor’s office about some sort of zoning law that’s coming in. You’re working a lot in areas like real estate. These are places where often conversations don’t get raised. In particular, it can really hurt minority groups. That’s something I’m thinking a lot about at the moment: How can we create conversations to allow people to weigh in? To allow, on the other side, the mayor’s office that is dying to hear that feedback. People want to give it. Today, you’d have to be able to show up probably for the in-real-life meeting, although a lot of them have gone virtual. But in real life, once a week, when the town council gets together or whatever. For a lot of people, that’s just not an option. If they’re working, if they have kids right there, their lives are busy. There are lots of ways that we attempt to bring together the affinity piece, but starting with that base of utility.

Max Simkoff: You’re originally from Northern Ireland. You’ve spent parts of your career in continental Europe and Africa, and obviously more recently in Silicon Valley here in the U.S. I know that in your current role, you have spent considerable time in communities around the world. How have you seen people’s approach to community engagement differ by geography, or even, through overarching local or national cultural norms? What are the key differences that you’ve seen in people’s approach to community engagement across those dimensions?

Sarah Friar: I’ll actually start by saying positively – and I hope it’s kind of an optimistic point of view – I think the great news is that I don’t think there’s a place in the world where people don’t value community. I grew up in a pretty tough place right in Northern Ireland, which when I was growing up was at war, literally. I grew up during The Troubles. I grew up in this teeny, tiny, little village. My local town was literally the most bombed town of its size for about three decades. That included even when the Bosnian crisis was going on – not the claim to fame most people want. So that was a tough backdrop, and yet community was just so incredibly important. Our village was known for the fact that we were a desegregated village – which is such a ridiculous term – but it was an important one. In our case, Catholics and Protestants – the two divides – all lived among each other. Our neighbors, who are still my parent’s neighbors to this day, were of a different religion. But we all came together, and all kinds of religion fell away because we were kids. We were in and out of each other’s houses. They babysat for us, the whole thing.

The good news is, I think people have way more in common now. That said, Nextdoor is in 11 countries. We definitely do see differences emerge. That’s actually an important part of the way we’ve built the product. When it comes to things like moderation – which is a very hot-button issue in social media – we have done it at a very hyper-local level, because our belief is that someone in San Francisco in no way can understand the color and the context of a question, say, in my dad’s neighborhood in Northern Ireland. They would have no idea that when someone’s using certain phrases, those might not be good phrases to use because they’re very much about the local area, or vice versa. One of the things I miss is good old British sarcasm. Americans probably get a little offended by it, and the Brits think it’s hysterical. So you need that kind of local element.

Now, in my first year at Nextdoor, I literally did go to 10 out of our 11 countries. I am kind of sad because I did not get to the 11th before COVID hit. If I think about the things that I saw go on, back to your point about how do you build affinity, one topic that came up that actually made me really sad – I’ve written a whole blog post on it, and we’ve just launched a whole research study on it – was loneliness, and just how much people were telling me they felt lonely. It wasn’t like when people in the community feel lonely, they kind of hop to, “oh, it must be the elderly.” It was teenagers who kind of felt lonely because they see friends on other platforms, where it’s maybe more about how you look or what you’ve got in life, not just who you are. We saw young moms – I think about personally, when I had my daughter and I was home for the first time, I’d always been at work. I totally will admit to being a little bit of a workaholic. I really found it hard to find a tribe that I could jive with. I felt really alone. I saw young mothers talking about that. I definitely saw divorcees, and I definitely saw elderly people maybe who’d lost a spouse. What was incredible was how brave some of those people were about it. There’s this great lunch I went to in Australia where Darlene had literally created kind of a weekly lunch. She really takes time, like everyone shows up, gets a rose that Darlene has gone and bought for them. And she kind of helps curate the conversation. Like you’re sitting eating and Darlene comes over and she’s like, you have to move now. And I was like, what are you talking about? And you just pick up your meal and go sit over there. So she moves like 20, 30 people around this table. She’s actually had two marriage proposals, not to her, but to two couples that came to her lunch. And it was like a really across the community experience.

I think in the end, when you boil it down from our first principle perspective, there’s just so much more in common than what divides us now. Country by country, though, you definitely see themes emerging. The U.S. feels very different right now from what we experienced, say, in the U.K., or in Denmark.

Max Simkoff: That’s great. I’m curious, what was the 11th country that you weren’t able to visit?

Sarah Friar: It was Italy! Who doesn’t go to Italy when they have the choice? I was kind of getting ready to go, and then COVID started, and it really hurt my mojo on that one.

Max Simkoff: 2020 has obviously been quite a year. I was texting with a friend last night who was at a company that has been also quite affected by a number of things going on this year, and she remarked to me, “I just I don’t know what the rest of 2020 has to offer, but I don’t care what it is. I just want it to be over.” How did COVID-19 affect your strategy and plans for the year?

Sarah Friar: Nextdoor has been very lucky in this crisis, and it’s actually been very good for business. That always feels hard when you look out on a world where people are dying and they’re affected the way they are. Going from February into March, we saw about an 80 percent lift in daily active users on the platform, which was extraordinary. Just learning to cope with that, and not having the site go down in and of itself was pretty extreme. There was a one- to two-week period of my life when I know I had engineers who weren’t even sleeping. I would look at people and you could see the weariness.

…when a really big crisis happens, you can often feel impotent, like I have no personal agency here. But just doing one small thing really can bring back a lot of mental health in times of stress.

I think the beginning of the pandemic for us, like in hindsight, it all kind of fits. It looks like you have this great, grand plan. I’ll definitely say that as a leader, people are really good at revisionist history about what they did and why they did it, and it all sounds so good. Honestly, half the time, you’re winging it. The first thing you could see was leaders and CEOs talking about the safety of their employee base, which of course was very top of mind, but frankly, for us, our employee base relative to the neighbors we serve, is very small. We really thought a lot about the safety of neighborhoods. Then one of the biggest things was just making sure the right information was coming from trusted sources. We moved quickly to make sure that we were working with the CDC and the WHO, for example, or local health and human services departments. We really have a lot of public agencies on the platform. We didn’t have to go get new people, but we really had to help them get the right information out. For me, my source every day for what’s going on in my county right now is the health and human services that post on Nextdoor. We did a lot of work with folks like Governor Cuomo, Governor Newsome here in California, the U.K. government, and the French Ministry of Health, to make sure that their information was getting to the top of the feed.

The second thing we saw really quickly happen was help, and it was more in the spirit of help to give. I think when people have a crisis, a very human natural response is, “what can I do?” Part of it is because humans genuinely want to give something. I think when a really big crisis happens, you can often feel impotent, like I have no personal agency here. But just doing one small thing really can bring back a lot of mental health in times of stress. So we saw people saying, “hey, I can go get groceries. Do you need me to go to the pharmacy for you? I can check in with an elderly neighbor.” We wanted to make sure that we could get that help to give, front and center. We actually created a product called Help Map. Quickly, we also saw what you didn’t want to have happen in a product like that was for it to become a map of the vulnerable. You didn’t want people putting themselves on a map as “help needed.” That’s when we created Help Groups, where you could actually drill down even more to create those one-to-one interactions, but do it again in a very safe, secure way. Help was a huge theme for us from March to April.

At the same time, with my background of local business, I knew the minute I walked out of my office and we went to shelter in place, all I could see was a coffee shop on the corner that I got my coffee from every morning going to work, and the lunch spots, and just thought, oh my, those things are not going to survive. This is a CBD – a central business district, as I learned about my geography class when I was 16. If people are not showing up to work, they have no customers. So what are we going to do for local businesses? We’ve done a massive push around local businesses, because we can see on the platform that neighbors are saying, “Hey, I want to help.” Originally, it was with donations, and then it was, “are you doing pickup or delivery?” Now it’s, “how do I shop safely?” We just did a whole campaign with the state of California on “shop safely, shop local,” because we could see that the neighbors want to do that.

I would say that COVID has really sped up our business. The leadership challenge has been much more about how we make sure we’re not doing spurious things that actually don’t have longevity. How do we make sure it would still be part of the arc of how we would grow a company, even if we’re doing two years of work in six months?

The final thing that actually just launched today is nonprofits. They are often the safety nets of our community, like the homeless shelter or the Humane Society. Small businesses are always on the knife-edge of cash flow. Nonprofits are over the knife edge. Fifty percent of them only have three months’ worth of working capital; 20 percent of them only have one month. Many of them raised money through things that happen in real life, like a sponsored run or Goodwill, you go give clothes to. They’re really, really in tough shape, so we launched something called Sell for Good. If you want to put something for sale, like whatever you sold on our classifieds page, you can now put all the proceeds to a nonprofit. Then, the back end connects to PayPal, where we’re using PayPal Giving Fund. But we think it’s a really great grassroots way to help, because we know people are cleaning their garage. They’re cleaning out their spare bedrooms. They want to give.

I would say that COVID has really sped up our business. The leadership challenge has been much more about how do we not redline people, and how do we make sure we’re not doing spurious things that actually don’t have longevity. How do we make sure it would still be part of the arc of how we would grow a company, even if we’re doing two years of work in six months?

Max Simkoff: Wow, what a cool new feature. I will probably use it.

Sarah Friar: My daughter has all these American Girl toys that we’ve kept. God knows why, she’s a teenager. We just told her, “Hey, I’ve got a way for you to give back.” She’s on there right now trying to pick her charitable organization. I think even for kids, it’s a great way to teach them about philanthropy.

Max Simkoff: It is, actually. I have a six-year-old daughter who might be interested in buying those American Girl toys. We could complete the circle for you.

Sarah Friar: And for you, I got a special deal – 100 percent higher.

[Both Laugh]

Max Simkoff: I have one more question I want to ask, and I want to leave a few minutes for a Q&A. I’ve seen a few come across.

The last question I want to make sure and ask here, Sarah, is something that actually over the years I’ve sought a lot of advice from you about, and that’s leadership in general through a variety of situations. Certainly, this year has thrown a number of new challenges your way. As a leader of a large organization, and as somebody who helps leaders like myself and leaders of other big companies and small tech companies navigating very challenging waters, what has been your most important learning as a leader this year, given the current environment?

Sarah Friar: I don’t know if they are brand new learnings, but they just always underscored. When I think about my leadership this year, the two words that keep coming to mind are transparency and empathy. I think as a leader, I’ve always aimed to be a very transparent leader to begin with – some might say an oversharer. For anyone who’s worked with me on the comms side, their job is to usually to pull Sarah back, because I love to share. But I think it’s really important in times of stress that people know what’s happening. Honestly, until you’re sick of saying it, most people can’t hear what you’re saying. You really have to over-communicate through every channel available to you. Now, most leaders we’re talking about think about things in the context of the company, and I really think about it in the context of our customer base. I have a lot of customers. There are 266,000 Neighborhoods. It’s a big challenge to figure out how to get communication out to all those folks, to let them know what is going on and why we’re doing certain things.

I’m very transparent about anything that’s going on — again, because that’s how you bring the best minds to the table. Why would you close the aperture to someone who knows about a problem, when by opening it, you may get far more diverse orthogonal ideas on how to solve a particular problem?

The second point is transparency, and they’re very interrelated. Again, I feel you always do better when there’s full transparency. I had an old head of comms that used to always say, tell the truth, because you won’t forget it. Again, they kind of go hand in glove. Even within my company, for example, we share our board materials before they go to the board, they go to the company. I’m very transparent about anything that’s going on — again, because that’s how you bring the best minds to the table. Why would you close the aperture to someone who knows about a problem, when by opening it, you may get far more diverse orthogonal ideas on how to solve a particular problem? So those two words have really struck me.
Personally, as a leader, I always say, “people first,” is my mantra – like, get your people right. Everything else just works. I do my people-oriented things early in the morning, because it’s when my brain is at its best. That’s a mantra I carried from my dad, who’s a really big people-person. I think what’s become clear in a crisis is the need for purpose. People need something more than just rallying around kind of a commercial intent. I think they need to believe there’s a purpose behind why they’re doing something. Purpose-driven companies can keep going even when the going gets really tough, and stay true to that purpose.

So certainly, lots of learning, lots of mistakes – but I think the key is just being honest. When you do make a mistake, that goes back to kind of the communication and the transparency piece.

Max Simkoff: Definitely. You mentioned earlier in our discussion the revisionist history that leaders oftentimes do, when looking back on, “oh, you know, we did these things, and we did them intentionally, and we had planned for them. And that’s why it went this way.” More often than not, you’re kind of winging it as you go. But I think I’ve certainly also learned that if you’re winging it – which is the only thing you can do when things are as dynamic as they are right now – and you are being transparent, then it’s much better than figuring it out and not explaining to people that you are figuring it out. You get a lot of leeway by just telling people that you are figuring out and asking them to help.

Looking at the questions coming in, the best one that I’ve seen, that’s very relevant, certainly to our business says, “Given the flux we’re seeing in the housing market, current conditions have driven people to question their home location choices and look towards the suburbs, especially those with families. There is also a greater demand for homes with dedicated office space. What other housing market trends have you seen emerge or accelerate at this time?” I’m guessing that they may have meant. What trends have you seen on the platform?

Sarah Friar: It’s a great question, and we do spend a lot of time, as you can imagine, working with, for example, real estate agents or mortgage brokers and so on, because they’re core to a Neighborhood. I always say that real estate agents don’t sell houses, they’re selling a home. They’re not selling a school district, they’re selling a sense of belonging.

I always say that real estate agents don’t sell houses, they’re selling a home. They’re not selling a school district, they’re selling a sense of belonging.

You all know that, so I’m just telling you your business at the moment. We have seen a lot of those trends like we actually put out in our Insights reports. If you search on LinkedIn, we put them out there. We’ve done two. Our third is coming out in August. We’ve definitely seen that local is very, very top of mind. But even within the home, people are getting creative. So home gym: 27 percent of our neighbors said in our most recent survey that they were exercising at home more frequently. I know for sure, in “For Sale and Free,” I had an elliptical to sell. I think 40 people wanted that elliptical. The person who took it, I don’t know how they got in their car, but they were not leaving without it. We definitely see a lot of posts around the home offices. Again, people being creative, they’re looking for the stand-up desk – which I highly recommend, by the way, for your health and just your mental well-being. Right now, there are big pushes around home patios. They are really top of mind – grills, barbecues. Yes, we always see this conversation up Nextdoor, but it’s like double its normal level. Even around things like gear. I was talking to someone yesterday about fishing gear. I will admit, I sit on the board of Walmart, as you know, and they were like, “Fishing gear is alive again. Who knew?” Because, if you think about it, people want to be outdoors, they want to be further from people. Sports are allowing people to be more distanced.

I think people are really rethinking, do they want to be in that urban area that’s very dense? We’re definitely seeing a lot of shifts out into suburbia and even beyond. I think people for the first time are contemplating, “I could go live wherever,” because in many cases, we have the privilege of being able to work from home.

I think people are really rethinking, do they want to be in that urban area that’s very dense? We’re definitely seeing a lot of shifts out into suburbia and even beyond. I think people for the first time are contemplating, “I could go live wherever,” because in many cases, we have the privilege of being able to work from home.

Max Simkoff: Definitely. It will be fascinating and probably very exciting for you and the business to be the fabric that accommodates a lot of the transitions that we’re probably going to see. I think having that sense of community will be important now more than ever.

We’re a little over on time. I really appreciate you making time for this. This has been so wonderful. I always enjoy speaking with you, this time being no exception. I’ve learned some things that I’m going to apply to how we manage our business, and also how I interact with my community. So I want to thank you again for making the time for it. Really appreciate it.

Sarah Friar: Not at all. I love what you guys are doing. States Title – amazing company. You’ve come so far in a very short period of time. I always learn a lot, too. So thank you.

Max Simkoff: Awesome. Thanks, Sarah.