Nextdoor Holdings, Inc.

Good afternoon. Thank you for attending today's Next Door Q4 2021 earnings call. My name is Tania and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. I would now like to pass the conference over to our host, Matt Anderson, head of investor relations. Please go ahead.

Thank you, Tania. I'm Matt Anderson, Head of Investor Relations. Good afternoon, and thank you for joining us today to review Nextdoor's fourth quarter 2021 financial results. With us on the call today are Sarah Fryer, Chief Executive Officer, and Mike Doyle, Chief Financial Officer. During this call, we may make statements related to our business that are forward-looking statements under federal securities laws. These statements are not guarantees of future performance. They are subject to a variety of risks and uncertainties. Our actual results could differ materially from expectations reflected in any forward-looking statements. For discussion of the material risks and other important factors that could affect our actual results, please refer to our SEC filings available on SEC's website and in the investor relations section of our website, as well as the risks and other important factors discussed in today's earnings release. Additionally, non-GAAP financial measures will be discussed on today's conference call. A reconciliation of these measures to their most directly comparable gap financial measures can be found in today's earnings release. With that, I'd like to turn the call over to Sarah.

Thank you, Matt, and hello, everyone. Q4 rounded out a strong 2021 for Nextdoor. We drove significant neighbor growth at scale, meaningfully increased engagement on the platform, welcomed businesses of all sizes, and with that delivered exceptional revenue growth. We also successfully completed our public offering, growing our cash balance to over $700 million, putting us in a position of strength to continue investing for long-term growth. In Q4, we delivered strong revenue growth of 48% year-over-year and drove 32% year-over-year growth in weekly active users, or WOW, to $36 million. Total revenue growth for 2021 was 56%, and accelerated by seven points year over year from 49% in 2020. Our strategy centered on building an active valued community is working. WOW Growth is driven by both new neighbors joining and finding value on Nextdoor, but also from current neighbors becoming increasingly more active. In Q4, WOW with the percent of total neighbors increased five percentage points year over year to 52% which represents an all time high. One of our key product initiatives in Q4 was the global launch of connections between neighbors. When you connect with another neighbor, you both have a more engaging, personalized experience on the platform. Looking ahead, we plan to expand connections to all neighborhood stakeholders. We'll start by enabling neighbors to connect with small and medium sized businesses in the first half of 2022. and will follow with the ability to connect with large brands, public agencies, and other local organizations and service providers. This will allow neighbors to hear from organizations they care about, and it will enable organizations to create meaningful, authentic connections with a uniquely engaged local audience. We believe connections will drive deeper engagement with Nextdoor because neighbors want to hear from neighbors and organizations that they know and trust. We continue to drive innovation to ensure that Nextdoor is a kind, welcoming platform. This is essential both to achieving our purpose and also to building a platform where all feel safe and are actively contributing. Our just-launched Transparency Report, a first for Nextdoor, highlighted our unique approach to moderation. This approach is multifaceted, combining proactive guidance through our Good Neighbor Pledge, leading-edge machine learning technology, and human review. As a reminder, less than 2% of all content on Nextdoor is actually reported for moderation. But today, we have over 230,000 volunteer community moderators who in 2021 reviewed almost 87% of all reported content in under five hours from the time of the report, as well as an internal neighborhood operations staff. Our moderators' high speed of engagement underscores the strength of the community on Nextdoor. Nextdoor's Kindness Reminder utilizes technology to detect language that may be harmful and make neighbors consider editing their post or comments before it goes live. In 2021, neighbors who encountered the Kindness Reminder edited or even withheld their post or comment over one-third of the time. On the international front, engagement metrics surpassed even U.S. engagement, giving us confidence in our global opportunity. Our approach for the year was to increase penetration in four key markets, Australia, Canada, the Netherlands, and the UK. In Q4, total wow in these focus markets grew almost 50% year over year, and 58%, or almost three out of every five verified neighbors, returned weekly. Turning to advertisers, in Q4, we continued to make progress scaling our proprietary ad platform. Nextdoor is uniquely positioned to be the platform that advertisers can rely on to connect them to an actively engaged local audience. For advertisers, our value proposition is simple. First, we provide access to a unique audience. According to a fourth quarter 2021 U.S. data from GWI, 76% of neighbors who visit Nextdoor at least once per month don't visit SNAP 69% don't visit TikTok, and 58% don't visit Twitter. Second, neighbors come with high intent. From our Q4 Insights series, we see that 24% are more likely than the average social media user to click on sponsored posts. Third, we can deliver a highly localized message, and this drives results. On Nextdoor, localized messaging drives 58% higher ad engagement than non-localized messaging. In Q4, we partnered with Hershey's on our 2021 Treat Map, which allowed neighbors to mark if they were planning to celebrate or hand out candy. The campaign was successful in generating incremental sales for Hershey's and expanding its footprint into households who hadn't purchased candy in the past year, clearly not my house. The investment in our proprietary ad platform is ensuring we can better utilize the first-party data from our fully logged-in audience. Hence, we can serve ads that are relevant to the neighborhood that people live in, and our users find them engaging, useful, and actionable. In a world that is increasingly shifting towards cookie-less browsing, Nextdoor's value is becoming more and more differentiated. For all advertising objectives, from brand awareness through direct response, we continue to improve our measurement and targeting capabilities. For example, the majority of our cost per acquisition, or CPA-focused advertisers, have now adopted our proprietary conversion pixel, which improves ad relevance and attribution. Home Chef is one such advertiser who saw their average newsfeed CPA improve by 25% over the course of 2021, giving them confidence to meaningfully scale their spend on Nextdoor. Finally, we're enhancing our self-serve capabilities with the Neighborhood Ad Center, or NAC. This increasingly enables us to serve a wider range of advertisers and ad agencies. NAC is only available for an initial subset of mid-market customers today, but our focus on building the platform and the early success customers are experiencing give us confidence for our rollout to advertisers of all sizes in 2022. We're excited by our progress and our 2022 strategy, which is designed to increase growth and engagement for all neighborhood stakeholders and deliver a richer experience for our advertisers. ultimately driving sustainable long-term growth in our business. And with that, I'll turn it over to Mike for our financial highlight.