Nextdoor Co-Founder Shares 3 Ways Businesses Can Better Connect with Local Communities

In the digital age, there are countless ways to connect with customers across the country and around the world. However, local communities still play a huge role in small business success — and vice versa. In fact, roughly 67 cents of every dollar spent at a small business stays in the local community, according to American Express.

That’s why it’s so important for small business owners to prioritize connecting with their local communities and serving them in the best way possible. At CO—’s 2021 Big Week for Small Business, Prakash Janakiraman, co-founder of hyperlocal social networking app Nextdoor, explained how small businesses can leverage data, digital presence, and diversity, equity, and inclusion (DEI) to forge those connections and flourish.

Gather Data About Your Audience, Test Your Business Idea, and Spread the Word

According to Janakiraman, the business idea for Nextdoor started with a simple premise. According to a Pew Research study, more than 50% of Americans don’t know all of their neighbors by name.

"We felt like technology could play an important role in bringing neighbors together for everyday things, like finding a babysitter or a plumber," the founder said.

To validate their hypothesis, the Nextdoor team quickly found the ideal candidate for their first prototype: a 90-household neighborhood in Menlo Park, California that was already connected via a listserv. The neighborhood quickly upgraded from the listserv to the Nextdoor prototype, using the platform to do everything from selling items to organizing their annual Halloween parade.

"We knew with that one initial … community that we were onto something," said Janakiraman. "But we were still in a challenge because … most people don’t know their neighbors, which means they don’t have electronic correspondence with them."

Since connecting electronically wasn’t an option for the brand, Nextdoor had to think outside the box when it came to marketing.

"In addition to calling friends and family … we needed a way for things to virally spread to people," Janakiraman explained. "We started to use postcards that we would drop on the mail and send on behalf of neighbors."

An Ideal Digital Presence Balances Spreading Awareness With Giving Back to Your Community

All businesses are looking for increased awareness and trying to get people to use their products and services. Nextdoor has the perception to see what successful small businesses do to connect with their local communities and increase their visibility. Janakiraman shared that the most successful small businesses engage with local residences through deals that target specific neighborhoods, sponsored ads, donation drives, and just offering advice and expertise.

"Businesses are a critical part of the neighborhood, they're neighbors just like residents in the neighborhood are," said Janakiraman. "For a platform like ours, it's really about speaking to the community and being a part of the community."

Janakiraman also advocates for businesses to not just build up their own awareness in the local communities but to be positive members within them.

"It's about being part of the community [and] showing up as a voice in the community… if you're an entrepreneur, there may be other business owners that are thinking about starting their own business. How can you be part of those conversations and feel like you're a part of the neighborhood?" he said. "Beyond just the transactional components of trying to drive more people, there are ways that you can show up and be part of the community and have a voice in the community."

Focus on Diversity, Equity, and Inclusion (DEI) to Ensure Your Business Reflects the Community It Serves

Companies of all sizes face the challenge of fostering cultures of diversity, equity, and inclusion (DEI). Janakiraman says this can be particularly difficult for small businesses, which often lack a dedicated DEI team. The key, Janakiraman said, is "to really show up in a way that is inclusive of all of those people and to make sure that they feel like they can be their authentic selves and feel a sense of belonging."

Janakiraman emphasized the importance of building a team that reflects the diversity of the community a business serves. He advised leaders to adopt an expansive definition of diversity that accounts for the full range of human experiences.

"Often when we talk about diversity, we talk about the things that are a little [easier] to characterize … the observable traits about people,” Janakiraman explained. “But there's so much more that constitutes our own lived experience."

For Janakiraman, diversity is only one piece of the puzzle.

"Equity and inclusion, I think, are the key cornerstones," he said. "As small business owners, what are the things that you can do to make people feel comfortable coming to your business or using your products? Do you offer different language choices for people who may not necessarily be native English speakers? Are you comfortable with people who have disabilities, for example? These are different types of diversity and inclusive practices that we need to think about."