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Nirav Tolia, Sarah Leary, Prakash Janakiraman and David Wiesen co-founded Nextdoor in 2008. Tolia had previously helped start Epinions. Early investors included Benchmark Capital, Shasta Ventures, and Rich Barton. The concept and patents that Nextdoor is based on were invented by "FatDoor" CEO Raj Abhyanker in 2006. Abhyanker pitched Benchmark Capital on Nextdoor in 2007. Nirav Tolia worked at Benchmark Capital as Entrepreneur in Residence at that time.
As of February 2014 [update], Nextdoor had 80 to 100 employees. In July 2012, Nextdoor raised US$18.6 million in venture capital funding. Dan Clancy (formerly of Google ) joined Nextdoor in February 2014.
On May 14, 2014, Nirav Tolia, then-CEO of Nextdoor, was charged with felony hit-and-run for allegedly fleeing a crash on Highway 101 in Brisbane, California, that left a woman injured. "It's ironic that the CEO of a company that is holding itself out as trying to promote neighborliness, crime watch and things like that flees the scene of an accident that he caused and doesn't bother to call 911 or stay around to exchange information or see if he caused any injuries," said the woman's attorney, Joseph Brent. On June 12, 2014, Tolia pled no contest and served 30 days of community service in lieu of jail time.
In February 2017, Nextdoor acquired the UK local social network service Streetlife in a "multimillion pound deal". Nextdoor's less stringent privacy and safety policies provoked concerns among some users of Streetlife—for example, full names and street addresses are visible to all members of a Nextdoor, but not Streetlife, neighbourhood—some reporting ensuing harm, such as abusive former partner finding out a woman's current address.
Advertising was added to the platform, including real estate advertising, in 2017. Advertising includes posts inside users' feeds about business services and products.
In July 2018, then-CEO co-founder Tolia announced plans to retire as chief executive officer (CEO), stating that he intended to become chair of the company's board following the transition. In October 2018, Square 's former chief financial officer Sarah Friar became CEO, succeeding Tolia. Tolia subsequently retained his seat as a member of the company board of directors.
In 2019, Nextdoor acquired Hoodline, a local news aggregator that is considered Pink-slime Journalism. Later that year, HuffPost and Wired reported that Nextdoor paid a firm to improve its reputation by lobbying for changes to the Wikipedia articles on Nextdoor, NBC, and several other corporations.
In November 2021, Nextdoor became a publicly traded company.
In February 2024, Sarah Friar stepped down as CEO and Tolia resumed the role. In March 2024, Tolia was accused of sexual harassment by a former employee.