The Room Podcast x Bessemer Venture Partners' Wish I Knew: Sarah Friar: Career lessons on community, conviction, and capital from Nextdoor’s CEO

He said, they just freed you. I was like, you know, in the tearful moment and I'm like, what are you talking about? And he was like, they just kind of left it up to you now. Like you can stay, put your head down if you wanna do it again, but they've also given you this moment to really change careers. And that was just a big unlock moment for me.

Welcome to Wish I Knew, the show about the revelatory aha moments that founders, CEOs, and leaders discover along their own business journeys and why taking risks leads to growth. I'm your host, David Cowan. And on today's episode, we're taking a trip across the pond and going back to the 1960s, specifically Northern Ireland. Because it was then and there that we start our story today. It was a time period known as the Troubles. For those unfamiliar, the Troubles were a time of war in Northern Ireland between two communities, the Protestants and the Catholics. For three decades, they oscillated between conflict and building peace walls. So why do I bring this up? Well, today's guest, Sarah Friar, the CEO of Nextdoor, grew up in Northern Ireland during this tumultuous time of major community divide. And community will be a word we hang onto quite a bit this episode because it was Sarah's time learning about the importance of community during the Troubles that ultimately inspired her to become the CEO of Nextdoor, the social network that services over 300,000 neighborhoods globally. But to hear about how she got there, I'm gonna turn it over to my partner at Bessemer, Byron Dieter, who crossed paths with Sarah Friar during her decade-plus tenure at Goldman Sachs.

Sarah Friar, you are one of my favorite executives in all of tech, and it's so exciting to be with you here today.

Thank you, Byron. And if I'm your favorite executive in tech, you've clearly got a bit of a low bar, but thank you.

One of my favorite, but it's a short list. Uh, and you have an unusual background for a Silicon Valley, Bay Area CEO, starting way over in Northern Ireland. So tell us a little bit about that upbringing and what led you to being here with us today.

Yeah, a little atypical. Not that many of us Northern Irish folks around. People always say I'm Irish. I'm like, technically kind of, but Northern Ireland is its own country. I grew up during the Troubles. Like, my mom has a story of literally when she was in the ambulance as I'm being born, the ambulance was having to weave its way past bonfires because people had shut down roads. I mean, Bloody Sunday had happened earlier that year. It was pretty brutal.

Wild.

And yet there I was growing up in this community where my mom was the local district nurse, my dad was the personnel manager for our local mill. I grew up in a tiny village of like 2,000 people. And even though we were Catholics and Protestants who supposedly all hated each other and were willing to kill each other, right, there was a really incredibly strong sense of community. And people always came to see my mom and dad if they were sick, they needed a job, whatever it was, my mom and dad were always on your radar. And so it really instilled this like amazing sense of what a strong community gives you in life. But it also taught me that it doesn't just happen to you, it happens because of you. And I think now sitting at Nextdoor, I see a way to force multiply that in the world.

Sarah's position as CEO of Nextdoor seems so fitting for her in this context, but it was a long journey before she found herself at the helm of the company. And it all began with her passion for engineering.

I was always very into STEM, as we would say today, but loved math and science. I really wanted to go to Oxford. I couldn't afford to go to Oxford. And so I had to take this kind of zaggy moment to go find a way to pay for university. I worked for Arthur Andersen the year before I went to university, and that took me into a world of business.

Arthur Andersen, an American accounting firm, offered Sarah a 1-year scholarship that allowed her to take a gap year before college, and they also paid for Sarah's 4-year stipend for university.

From Oxford as an engineer, I had the experience of going and working in like a really hard technology environment on a gold mine in Ghana, believe it or not. Kind of ran into the "you can't be what you can't see" moment, seeing no women that look like me in this job. So I pivoted completely to work for McKinsey. They sent me off to South Africa. I learned a lot about community there as well. McKinsey sent me to business school in the US. That's why I came to Silicon Valley. And I was so lucky to get to show up here in the late '90s and just the whole amazing crescendo of what was that first tech bubble.

The tech gold rush.

Yeah, totally. But we thought it was like never gonna end.

Do you recommend B-School to young execs who come to you for advice these days?

I'm a huge fan of business school. Like really hugely changed my life. I think at the time I learned a lot. Like a lot of people used to poo-poo business school and say, oh, you're not really gonna learn anything, but you'll meet this great network. Network. I feel like I learned a ton and I met a great network. And you'll always pick up the phone for your Business School class, like always, because it's small enough that it truly is people you know, it is community. I'm usually pretty strongly in the recommending camp, but I do think that there is a time in people's lives when you have to figure out what the opportunity cost is too. There are people where I've said, you should do it, but you should keep doing what you're doing here for another couple of years. There's moments in startups where I think your ability to own things that are creating brand new things in the world, but that will be force multiplied, right? If you build something at Nextdoor, 80 million people are gonna experience it. That is like so amazing if you're able to do something like that as a young product manager in your 20s, that I would almost say, wait a while, business school will be there, but this thing you're doing right now is so immense. Like you've got too many other things you can learn right here. But I do think at some point in a career, it's absolutely worth it. And generally speaking, by the way, I just met this amazing woman from Stanford, Laura Kastorson, who runs the Stanford Center on Longevity. And she made this great point that, you know, today I think something like, don't quote me, but in 1950, only 5% of Americans lived past the age of 65. Today, 50% of today's 5-year-olds will live to be 100. So if you just think about a life that's now likely to be 100 years—

I've never heard that stat. That is mind-boggling.

It's kind of mind-boggling. It's like, what's the rush? Like, the idea that you would get all your education over and done by, by the time, you know, you're in your late 20s, it's just stupid because the world is going to change so much that we probably should have moments where you go back to school in your 40s, back to school back to school in your '80s, for God's sake. Like, if you're gonna live for 100 years, you should constantly in some ways be having those great education moments. And, you know, something I wish I had done was maybe go straight into the startup world right as I finished business school out here. I didn't. You know, again, I had a lot of debt and I needed a visa, so I went and worked for Goldman thinking that would be short and sweet. It's actually where we met along that way.

Indeed. I do wanna touch on the Goldman Sachs experience experience and kind of your entry into tech first. You'd spent over a decade there, and, and as you mentioned, that's when we first met. I remember back, uh, my first IPO with Cornerstone On Demand, we picked Goldman largely because you were so strong, and then you made the aggressive career jump over to the operating world. And so what drove the jump and how did that change your trajectory into this career?

Yeah, so you and I definitely kind of grew up at that moment in time when the world of cloud computing was coming about. Like, I definitely say that I made my career on cloud computing, but I think you did pretty well on cloud computing too, for You were one of the gurus and then you abandoned us, but we're gonna get to that too. You know, for everyone listening today, there are just these moments in time, like clearly where we're at with generative AI, like everyone's talking about it, but it feels like those moments where until you unveil what's in it for the user, they're like, AI, whatever, crypto, whatever, cloud computing, whatever. But as soon as you could add a front end to it that made it super valuable to the user. That's when it came alive. And even then, you didn't have to know where the bits and bytes were sitting. Were they sitting in your company's data center, or were they sitting up in this thing called the cloud? Like, who cares? As long as you could sign your DocuSign from your phone, you know, while you're on vacation, or tap into your CRM system sitting in the car as you wait to walk into your client, right? It's kind of mind-boggling, but today people just take it for granted. So it was a wonderful decade of my life learning and seeing these technology shifts happening. At the same time, I think I was always a bit of a frustrated operator. Like even as a consultant, the thing I hated most at McKinsey was the last day of the client engagement where we handed over these beautiful, you know, pieces of stone, your strategy, and then you're like, oh my God, this sinking pit in your stomach, they're never gonna actually implement it. And I realized I actually really enjoyed a lot more of the implementation. So it's actually, I don't know if I've talked about this really, but Aneel Bhusri, who's, you know—

Workday chairman, co-CEO.

So, I was doing a software bus trip, and of course Workday was one of the up-and-coming cloud vendors. And Aneel was just like, "You are wasted here. Like, you should come operate." He just kept getting into my psyche and in my ear. And I talked to Aneel about what I would do. He was talking about strategy role, and I was kind of like, "Oh, I don't want to do the strategy thing again." Like, I managed to like get out of that. But it caused me to start having conversations. And then one day, one of the women on my team got promoted and I came home and I said to my husband, "Okay, champagne time. It's amazing. Stephanie just got promoted." And David kind of turned to me and said, "You really don't get this excited about stocks or stock calls. I just see you so excited about people things all the time. Kind of like, are you sure you're in the right job?" So we had that first conversation. And then Goldman's like partner decision came out and I didn't make partner and I was super devastated. But my husband saying, "They just freed you." I was like, you know, in the tearful moment and he was like, "They just freed you." And I'm like, "What are you talking about?" And he was like, "They just kind of left it up to you now. Like you can stay, put your head down if you wanna do it again, but they've also given you this moment to really change career. You don't seem as happy about what you do and why you do it." And that was just a big unlock moment for me of like, You're absolutely right. Now, it was terrifying because I resigned from that job before I had a job. But, you know, I had the Anil on one shoulder saying, you'd be really good at this operating thing. And my husband saying, you don't love what you do. You're not passionate about it. And it just made for that moment where I was like, okay, I'm going to dive off the high board. I hope there's water in the pool, but I'm going to do it. I'm going to go see what this operating career is all about.

Well, clearly a lot of happy outcomes since then, but our listeners often learn more from the failures than successes. And so I'm hoping you could double-click there specifically because there's a lot of people out there that maybe were laid off in the last several quarters and they're looking at these similar career transition points. You know, how did you feel at the time? How do you view it now? What advice do you have for people that maybe have one of these unlock moments where they were successful down a path and yet there's an adjacent path that maybe is they didn't have the courage to seek otherwise, but now have an opportunity to do so.

I think you just started it really well. It's an opportunity. So you've got to get yourself into that super positive mindset of like, wow, the world just unfolded something right in front of me and let me go grab it. And I think what I learned in that period of time was number one, the value of a great network or a great community. Go talk to lots of people. And at the end of every conversation, Ask them who are the 2 other people they would introduce you to that you should go talk to. So that was number 1. That's kind of the moment where you're going super broad. You're going to get tons and tons of information in, and you're probably going to leave every day thinking, oh, that would be a good— like, every— the last thing you hear about will be like, that would be cool. Then you have to get to a point of like actually self-aware and like spend time with yourself too, almost like interview yourself. What are you both good at and passionate about? Like, a lot of people are good at things they're not passionate about. I think there are also people who are not good at things and very passionate about them. Like, that's the self-awareness thing really coming through. And if you can't get to self-awareness, make sure you have a truth-sayer around you. I'll tell you a quick funny story on that. One of the people I got introduced to was a headhunter who headhunted for CFOs, and I sat down for lunch with him and I kind of told him my background, and he just looked me in the eye and he was like, You don't even know what a CFO does. And like by the end of the lunch, he just broke me down. I was almost like crying into my, like, whatever dessert I had bought to like make up for it. You know, again, I'd gone through the really broad information gathering. Everyone thought I could do every job under the sun. I'd done the, here's what I really love to do, what I'm good at doing. And then it had this truth moment. So like, find your truth-sayers. Like if you don't at least have 1 or 2 really uncomfortable conversations where someone tells you what you don't know, you have not yet done all the networking you need to do for that new career.

People often talk about the personal board of advisors, which I love, having some people in your life that you can go to for that candor.

Yes. So that's the go broad and then start to narrow in with what you're interested in. But then I think you have to just throw away your ego as well. So when I went to Salesforce, which was actually the first job I took in that operator role—

That did have a strategy title in it though. I think you're SVP Finance Ad Strategy.

Well, this is like, I've just told you to throw away ego and then I will tell you how I didn't throw it away. Of my ego, but I, you know, I went to talk to Marc Benioff. Of course you'd wanna talk to Marc. I'd been looking at all of these private company CFO roles.

Marc Benioff, he's the founder CEO of Salesforce, the giant customer relationship management software company in San Francisco.

Marc said something really interesting, which is, come work for me cuz you'll learn a lot more at a slightly bigger company where we do 100 things in a period. Versus if you go to a private company that's small, you'll kind of have to do one or maybe two things, and you won't learn as much in that moment. And, you know, look back on that and definitely, 'cause once I went to the small company, I saw that, but I needed that bigger company moment to get the diversity of learning. On the throwing away your ego point, the job that they hired me to was run FP&A, and I was like, oh my God, I just can't tell anyone at Goldman I'm like going to be the head of FP&A.

FP&A, by the way, stands for financial planning and analysis and relates to business forecasting.

Like in hindsight, oh my God, I ridicule myself because—

but this is where the ego is tied up in perhaps—

totally, because the people who do the job, by the way, are amazing. And I didn't even know what the job was, but that's why I retitled it finance and strategy, because I knew I wanted to go hire a bunch of people who had maybe a similar background to me if we were gonna do all of like the planning for a— it was a good size, it was about a 5,000-person company at the time. Like, I thought Salesforce was big, nothing to the juggernaut it became. But I wanted to go hire people with that sort of banking background, PE background, VC background, alongside good kind of understanding of financials. And I didn't think they would come work for FP&A, but they did all run to work in F&S, finance and strategy. So, I made that title up.

As you built your all-star team.

Yeah. So, on the one hand, I took down my ego, 'cause I was like, I'm just gonna do this job, I don't know what it is. I'm just gonna dive in. On the other hand, I had an ego moment.

Sarah was crushing it in her leadership position at arguably the most successful software company in Silicon Valley, only to give it up and boldly join an ambitious but speculative venture. Coming up, we'll get into Sarah's time at Square and of course, her decision to lead Nextdoor. Stay tuned. Sarah spent just over a year at Salesforce in a newly minted position before deciding she was ready to make an even bigger jump and become a CFO herself at a fintech company called Square back in 2012. Square is the mobile payment company co-founded by Jack Dorsey, who is also a co-founder of Twitter. And Sarah spent nearly 7 years working right beside Jack. As the company continued to grow and go public in 2015.

Talk to us a little bit about how the two of you complemented each other and what was appealing for that role.

Yeah, so Jack had been on the scout for a CFO for Square for a long time, and I think he'd interviewed mostly everyone in Silicon Valley who'd been a CFO. And this is very Jack, where I always feel like his key points of strength, number one was I think he was great at hiring. I think he is great at hiring. He has a remarkable way of putting a team around him that complements all the things that he doesn't want to do. Like, I think he's great at the kind of ideation point, like the bending the laws of physics. I think he's also amazing at design, but he knows he doesn't want to do a lot of operating, frankly. And so he gathers people around him that are very loyal to him because he lets them fly, but also that complement the places that he doesn't want to lean in. Not because he couldn't do it, but because he doesn't want to do it. And I did not know how lucky I was going to get working with someone like that because Jack took my career— you know, I came in as a CFO. I can remember I joined Square, and, you know, in Salesforce, I had probably a 100-person team. And I went to Square, and I had like a 15-person team.

And I didn't remember you said the whole company was only 200 when you joined?

It was 200 people. Wow. And like most of my 15 people, by the way, were in chargebacks, which are this thing that's very related to a fintech or to, you know, someone in the card processing space. And then very quickly, Jack would keep adding things like, can you do this? Can you do that? And so, you know, throughout my course of 7 years at Square, I probably ran most parts of the company except pure kind of product. Like I got to co-found and create products like Square Capital, Square Payroll, which is really crazy to think of a CFO being in the midst of that. But again, Jack very much was like, if you can do it, I'm gonna keep giving it to you until, like, you cry uncle and, like, move it on to someone else.

And I suspect that's something that you've carried forward, given, uh, the, the praise for the approach. Well, what about as you think back? So you had a front row seat at two of the absolute defining companies in this cloud wave, and we've now had trillions of dollars of market cap created and countless thousands of jobs created. What are the things that you're most proud of about your Salesforce and Square time? What are the things that you look back and say, not only was I part of that, but I helped transform and create that?

Such a lovely question. I mean, I'll always be inordinately proud of the team and the people that I had the pleasure of either recruiting and bringing on to the team, or, you know, by luck, they somehow happened in there because someone else was smart enough to actually recruit them. And when I recruit, I look for smarts first, loyalty second, and experience more of a distant third. And loyalty is kind of a funky word because I've realized in hindsight, it's probably more grit is what I mean by loyalty.

I was going to ask you to double-click on that because you don't often hear that.

I think it's more grit than loyalty, but I do think that startups are really hard. Like, every company is hard. Like, from the outside, it might look like Square was straight up and to the right. Square was like Swiss cheese. There was always something that was falling apart, not working. People forget our IPO wasn't the most successful moment in time. And you needed people that could get through the really tough times that were those leaders who always found positivity and kind of led people not just with their heads but with their hearts. So that's kind of number one, very proud of the people. I think I'm also proud though of being able to find these big trends and say, I'm going to attach my wagon to that trend because I'm just a fundamental believer that the world is changing, right? I remember being at a whiteboard with Jack when he was hiring me. And talking about like the why of Square. And it was really, it was my analyst training coming to bear. I was looking at this company and saying, number one, you have this advent of wireless happening, right? People forget that Square, I think, was like the second app to ever go on an iPad because the iPad had just been invented. That was what got us into those early days Square merchants. So one was this growth of wireless. The second was the consumerization of tech, right? We use this very fancy term, for the fact that people were starting to use like corporate-y things on their phone to do things. And then I think the third thing was the banking industry had not been at all disrupted, right? If you went and looked at the S&P and looked at the amount of market cap in say something like telco, the telcos had been decimated by what ultimately came afterwards. You know, all of these industries one by one had kind of—

The tech assault had worked through them, but fintech wasn't a thing yet.

Fintech was not a thing. And so when you looked at those three overlapping circles and kind of put them on a page, if you could put Square fundamentally at the, you know, literally the nexus of it, I was like, this company has to work, or at least a company like it is going to work. The same was true in the generation before, right, looking at Salesforce, that you saw that the cost of compute was coming down, that the ability to do more— it was also kind of based somewhat on wireless or the ability to kind of move bits and bytes fast and the growth of consumer devices, again, you could kind of understand why the cloud was going to work. And I, you know, I'd go to New York, meet these investors, and they would say about Salesforce, it's a good idea, but it's never going to have a market cap more than $10 billion because banks are never going to move their data out of their data centers. And I think when you saw it from a different angle, you were like, there's no way this isn't going to happen. And so I think that's the second thing I'm proud of is being able to cut through a lot of noise, simplify it to 1, 2, or 3 trends and say, this is the bullseye.

I can hear from the passion in your voice. That's the perfect jumping off point. You jump to Nextdoor.

Nextdoor, the social network company where Sarah currently serves as CEO. Sarah took a risk joining the company in 2018. but it was a risk rooted in passion.

Tell us a little bit about what was so compelling. Do you remember when you first heard about it and what your initial thoughts were about the opportunity?

Yeah. I mean, I've been on the platform for a long time just 'cause I'm, it's high utility. A lot of my neighborhood's on Nextdoor. It's how we get stuff done where I live. But when the CEO job came around, there were kind of 3 things that spoke to me. Number 1 was community, and that's why I started with my roots. Like I'm at a stage of my career where when I work on something, I want to feel like it can have a really big impact on something I think matters in the world. So if you want to be super selfish and say it's all about me, turns out knowing 6 neighbors or more will absolutely make you a happier person and make you live longer. So it's, it's really basic.

Right? Like social construct has benefits.

Absolutely. Totally. And you know, if you've read any of like Bob Putnam's work or whatever about bowling alone, He has endless stats to prove it. So I want to work on something that's big, but doing something in the world I care about. That was kind of number one. Number two, with my analyst hat on, I do love big data environments, and Nextdoor has a local knowledge graph that is unparalleled, right? There's no one else has what we have, which is endlessly created dynamic local content, right? What's that noise? I lost a dog, right? These are all things that are incredibly real-time. You can't go Google search for them, and it brought together this cast of characters from a resident to a small business to a big business, but all have different ways of using data that I think you can create a big business model around. Now, we still clearly have a lot of work to do on that front. Generative AI, I think, actually is a big lean-in moment for us because you're training a big model on data that only we have access to.

Oh, intriguing. I wouldn't have thought of that, but absolutely in that context, it makes a ton of sense.

Yeah, data really unique. And then I think the third thing always brings you back to people. I was so happy at Square. I was not taking any phone calls. It was a friend who inbounded, of course, and said, hey, would you be willing to take— just have a chat with me? He knew all the right buttons to press about community stuff I cared about. And then when I met the team, like, Nextdoor is a place where people really do join, not just because they're great at what they do and experts at what they do, but they have this extra passion for community. And what I found at Square is the people who have that extra gear about the passion for the thing, they're the people who run through walls. Like when the shit really hits the fan, like they're the people you want in your core.

When they believe they're gonna work the evenings and weekends and have the grit that you talked about before.

They do. And, and so I really love that. And I think that's continued. Like again, when I joined Nextdoor, we were 200 people. Now we're 700 people. And I still see, like we hire for that grit, frankly.

And it makes sense why grit was a trait they looked out for in potential hires. Nextdoor over the last few years has made headlines for facing a set of challenges that were extremely unique to their market of local communities around the world.

In the internet world, of course, when you get these massive user bases, you inevitably get some bad actors and challenges in this as well. And so, um, maybe can you talk through a little bit about just how you faced some of these community challenges and and the adversity. I know that there was, you know, racial profiling with some of the users as an example. And how have you dealt with these challenges and how have you addressed them?

Yeah, so I mean, you have to hit them straight on. We as a team have the way we run our company, we call it pillars. We have a pillar for growth, pillar for engagement, but we have a pillar for vitality. You have to do the work. It's like, yes, neighbors are wonderful. They do amazingly, unexpectedly awesome things. But there's always the underbelly of like some things that are just not very nice. Now, in the end, the number one thing when you come through the door is you're a real person at a real address. So we take the time to verify you. Second thing is we actually ask you to take a pledge in the neighborhood. So that's steeped in a lot of deep social science. For example, SPARK is a group in the behavioral science arena about things like if you take a pledge upfront, and then are reminded later that you might be breaking the rules, you actually inherently act better. We also really changed the way we think about moderation. So at Nextdoor, anyone can report a piece of content or a person. At that point, most of that goes to community moderators, and we have about 220,000 active moderators. That makes us bigger than Facebook in terms of the moderator platform. They take down content in under 5 hours if it truly breaks our guidelines. Now, there's still that tough racism, discrimination. When we see someone reporting for that, that comes off the platform as fast as possible. We hold ourselves to a really high bar of views, actually, of content. But like one other thing I'm really proud of, we launched something called the Kindness Reminder. And this was where we know that when you stop people mid-flight, right before they're about to post, and this is a good example where AI is already in action on the platform, 'cause we know from our data the likelihood of a post being reported, we can score it immediately. We stop you and we make you read something. And honestly—

Well, in real time.

Yeah, totally. We could make you read the phone book, anything, because—

The cooling off period.

What's happening is you're— this front part of your brain that I'm pointing at that no one can see since you're listening to me, but your frontal lobe is now in action. You've gotten out of that old dinosaur brain. So that's number 1. Number 2, we insinuate that the thing that it's gonna be reflected in a more negative way in a future state, which humans don't like. So we say, "Hey, looks like what you're writing will probably get reported. Would you like to edit it?" And so today you can edit it. About a third of people edit. But where I'm excited about something like generative AI is like, can we now suggest? Because you don't wanna stifle debate. Like, I grew up in Northern Ireland. If Catholics and Protestants couldn't have had really hard conversations, about terrible atrocities that happened in neighborhoods, we would never have gotten to peace. So I don't wanna stop conversations, but it's how can people stay constructive? And so these are places where I think Nextdoor has actually been on the real bleeding edge of innovation, even though the big platforms have more people and more money to put at it. I actually think we have done it because we care and we're passionate about it.

And I think the community The community gives you a lot of credit for that. I would also encourage our listeners to Google the transparency reports, as I feel like Nextdoor has done a fantastic service for the community in being transparent and also setting an example for other similar businesses to follow. Now, uh, the company did go through the IPO journey, and I wanna ask you a question on that because you've literally been now on every side of this journey, including the investment banker taking companies public, private to public CFO. And then a CEO taking your company public. And let me be blunt, did you get this one right with your timing? If you could go back in time, would you take the company public when you did? What lessons maybe are applicable to others? Um, and could you have predicted the, uh, the global chaos that ensued over these last few quarters?

Um, the phrase that sticks with me is raise money when you can.

Hear, hear.

So my old head of the audit committee at Square, David Veneer, former CFO of Goldman Sachs, He used to joke, he's like, I'm gonna give you the CFO playbook, Sarah. Page 1 says, raise money when you can. Page 2 says, raise money when you can. And then he had like a whole shtick where he kept—

Page 3 is never run outta money.

Page 100 was still like, never run outta money, raise money when you can. So that's always stuck with me. So in the case of Nextdoor, 2021, we were coming off this amazing year of growth because everyone cared about their neighborhood during COVID Everyone found their neighborhood. And we had maintained the engagement. So our numbers were incredible. We looked at our business and said, like, one of the things that struck me is when I looked at other platforms like Pinterest, Twitter, Snap, pre-IPO, they had all raised anywhere from $3 to $6 billion. And we had raised about half a billion dollars, right? People outside of Silicon Valley, they're like, half a billion dollars, that's so much money. But I was looking at these platforms that had raised so much money that we were trying to not so much compete with, but like muscle up to be the same scale as—

Relative to your peer set, it was pretty efficient.

And so we said, there's a moment in time, there is a lot of surplus money that wants to go to work. We have a need and we think we can deploy it in an incredibly growth-effective way. Um, are we early? Yes. Eyes wide open. We're totally an early company because we've really only begun our monetization journey. But do we have the team? Do we have great ideas? And do we have proof points of strong product market fit? Yes. Okay. We should go raise money when you can. Now being a public company in 2022, particularly one that makes their money through advertising, it's clearly been a bumpy ride.

Few headwinds out there for the sector.

Yes. But then, you know, my other favorite financial quote is always like, in the short run, the market's a popularity machine. In the long run, it's a weighing machine. Thank you, Philip Graham. It's my favorite phrase. I tell it to people all the time. Like when they're like, why is their stock up today? Why is their stock down today? I'm like, I don't know. Did you create value today? Did you destroy value today?

Think long-term and it should settle out.

It will. Like in the end, stocks will trade to fundamentals. Now you might not have the fundamentals. That's a bigger problem, but that's what will happen. Markets will normalize. They are cyclical for a reason. Sometimes it just takes longer. And that's why you need to raise money when you can.

Well, I've heard many people say through the years that they would never bet against Sarah Friar. So—

Can I just tell you, my husband bought me a sweatshirt and it says, "Underestimate me. That'll be fun." And so when I'm having a particularly bad day, I put that on to remind myself.

Oh, I think we all need one of those these days.

Exactly.

A lot to be excited about ahead. But talk a little bit about The Next Door vision and just some of those inspiring user stories and community stories and the impact you've seen. I constantly hear you talking about just examples that almost bring a tear to your eye and just how communities come together through adversity and those things. Can you just put a little context to those so people understand the impact that you're having at that scale?

I mean, absolutely. And this is where, like, when I tell people what I do, they often think I'm like the CEO of, like, literally their neighborhood because everyone's experience is so super hyperlocal. But Nextdoor is this interweaving of utility and community. And, you know, when I joined, we actually did some brand work and we were like, well, should we lean into utility first? But we're like, well, no, because the utility is actually amplified by the community. So here's an example we had, and it's very apropos at the moment when people are losing their jobs. So we saw a neighbor lose her job. I was trying to figure out what she could do just to earn some dollars in the neighborhood, right? And so she's totally in love with books. So she turned to Nextdoor and said that she was launching an online bookselling business, but wanted some donations of books from her local community just to get started. That's a great Nextdoor post, 'cause people always have the, "Oh my God, yeah, I have like the 5 books," or, you know, sometimes it's a sad story, like, "My father passed away, but it turns out he collected, you know, these books." So her neighborhood showed up for her, and in 120 days, She had generated $10,000 of revenue from selling 665 books online, which is kind of amazing. Something you can only do locally because you need to have this power of the community wanting to help you. They're not— probably not going to go FedEx you a bunch of books, so you have to be able to go to their house and collect it. And then for the selling back into the community, I mean, that's a place where maybe you can go more online. It doesn't have to be just only local, but I just found it amazing that a person generated $10,000— like, it's not small beans— in, you know, a quarter and is starting her business. And she's starting it with this power of her community behind her.

Community came behind and rallied, and, and they wouldn't have been connected but for the platform in that way, which is awesome. Well, what I'd like to do is jump to some rapid-fire questions if you're game, um, so our guests get to know you a little more personally. I have 5 rapid-fire questions for you. Are you ready?

I'm ready.

What are you reading or watching currently?

I am reading Chip War because I am that interesting. It's awesome.

Excellent. Okay, number 2: What's your favorite place that isn't your home or work?

Oh, that's easy. That is somewhere on the top of Mount Tam, which is where I live in the North Bay. I love green. I like being outdoors. I love hiking. So anywhere on Mount Tam.

If you could have a stage walkout song, what would it be?

I always play with my daughter Beyoncé's "Who Rules the World?

Girls Do." That is awesome. What skill would you love to learn?

I've always wanted the superpower of being able to just magically get from place to place instantaneously. And part of that is because I actually really do miss my Northern Irish community. I would love the superpower of like being able to instantaneously show up somewhere. Teleportation.

Oh, well played. What do you wish you could do more of or less of?

Oh, the first one is easy. I wish I could say no to more things because I love to overstretch myself and hence everyone around me.

Final question. On the Wish I Knew podcast, we end each episode with a parting thought for our listeners as they embark on their own personal and professional journeys. So I'll ask you this question. What do you wish you knew either before it all began or as it was unfolding?

I wish I knew at the beginning of my career this point about staying true to my values, even when it's really difficult. I think it's one of the most important things you can do as a leader. And the reason why is that the courage that it takes to stand up for what you believe in, even when it's against the grain, is hard. But when you do it, you attract really like-minded people who tend to have that grit— I'm gonna use the word grit now— the grit to come with you 'cause they're really inspired by your authenticity. And as a leader, I often get told I seem really down to earth. And I think part of it is because you kind of know what you're getting now. And I couldn't vocalize it or put it into words earlier in my career. And coming as a young woman out of Northern Ireland, I often felt like I had to be a chameleon to fit in. Like, I changed my accent because people didn't, you know, either they thought I was a terrorist or they thought I was dumb. I wanted to be more like the guys because I worked in these really male-dominated arenas. Once I kind of found my courage to say, these are my values and I won't compromise them, it's just made the journey so much easier on the one hand, 'cause there's no dissonance, but harder 'cause often I'm standing for things that are not popular at that moment in time. So I wish I knew earlier that staying true to your values will pay you back a thousand times over.

That's it for today's episode of Wish I Knew. You can find and follow the show on Apple, Spotify, Amazon Music, or anywhere you listen to podcasts, or at bvp.com/wishiknew. An extra special thank you to Sarah Fryer for joining us on today's episode. Wish I Knew is a podcast by Bessemer Venture Partners. The show was created by our very own Karen Lee and Christine Diekers. I'm your host, David Cowan. Our show is produced by the team at Philia Media. Our lead producer is Molly Getman. Our executive producer is Kate Walsh. We're engineered by Evan Viola. Our theme music is by Terry Divine King at Audio Network. Additional music by Blue Dot Sessions. And remember, it's important to always have a truth-sayer around you. That's all for season 2 of Wish I Knew. Thanks so much for listening, and If you enjoyed the show, please share with your friends and colleagues. We'll see you soon.