Case Summary

Nextdoor Holdings f/k/a Khosla Ventures

NYSE: KIND

Case Details

  • Adamo v. Nextdoor Holdings, Inc. et al.
  • Class Period:July 6, 2021 - November 8, 2022
  • Date Filed:February 28, 2024
  • Jurisdiction:U.S. District Court, Northern District of California
  • Docket Number: 5:24-cv-01213
  • Lead Plaintiff Deadline: April 29, 2024
Days Left to
Seek Plaintiff
6

Overview

A class action lawsuit has been filed against Nextdoor Holdings, Inc. f/k/a Khosla Ventures Acquisition Co. II (“Nextdoor” or the “Company”) (NYSE: KIND) and certain of the Company’s current and former senior executive officers alleging violations of the Securities Exchange Act of 1934.  The Nextdoor lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired publicly traded Class A common stock of Nextdoor between July 6, 2021 and November 8, 2022, both dates inclusive (the “Class Period”), and investors have until April 29, 2024 to seek appointment as lead plaintiff of the Nextdoor class action lawsuit.

Nextdoor operates a hyperlocal online social networking platform that connects neighbors, public agencies, and businesses via the internet.  Nextdoor was created through the November 5, 2021 merger of a privately held company called Nextdoor, Inc. (Nextdoor Private) and a publicly traded special purpose acquisition company (“SPAC” or blank-check company), then called Khosla Ventures Acquisition Co. II, with KV Acquisition Co. II serving as the surviving entity and changing its name to Nextdoor Holdings, Inc. after the merger.

The Nextdoor class action lawsuit alleges that Defendants, throughout the Class Period, made false and/or misleading statements and/or failed to disclose that: (1) Nextdoor’s financial results prior to the merger had been temporarily inflated by the ephemeral effects of the COVID-19 pandemic, which had pulled forward demand for Nextdoor’s platform and cannibalized future advertising revenue growth; (2) rather than being sustained, such growth trends had already begun reversing at the start of the Class Period; (3) Nextdoor’s total addressable market was materially smaller than the 312 million households represented to investors; and (4) by the start of the Class Period, Nextdoor’s most important market (the U.S. market) was already substantially saturated, impairing Nextdoor’s ability to monetize users and increase its average revenue per weekly active user (“ARPU”) or U.S. weekly active users (“WAUs”).

On March 1, 2022, Nextdoor reported that the revenue growth rate in the fourth quarter had declined sequentially by 18% to 48% year-over-year growth, down from the 66% growth rate in the most recent quarter reported to investors.  In addition, Nextdoor reported a quarterly ARPU of $1.65, revealing that the ARPU growth rate in the quarter had declined substantially by 26% to just 12% year-over-year growth from 38% growth in the third quarter, which indicated that Nextdoor’s ability to monetize its platform was faltering.  On this news, the price of Nextdoor Class A common stock declined approximately 14%.

Then, on May 10, 2022, Nextdoor revealed that its global WAUs growth had increased just 1% sequentially (from 32% year-over-year growth in the fourth quarter of 2021 to 33% year-over-year growth in the first quarter of 2022), and that U.S. WAUs had suffered a sequential decline of approximately 100,000 thousand users.  On this news, the price of Nextdoor Class A common stock fell approximately 8%.  Thereafter, on August 9, 2022, Nextdoor revealed that its platform continued to materially decline, reporting that revenue growth slowed to just 19% year-over-year during the quarter and that Nextdoor’s U.S. WAUs had declined for the second quarter in a row to 29.2 million.  On this news, the price of Nextdoor Class A common stock fell approximately 25%.  Finally, on November 8, 2022, Nextdoor reported that its revenues during the quarter declined sequentially by $1 million to $54 million, representing just 2% year-over-year growth, and that Nextdoor’s quarterly ARPU growth was increasingly negative, contracting by 12% compared to the prior year quarter.  On this news, the price of Nextdoor Class A common stock fell approximately 11%, further damaging investors.

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If you purchased or otherwise acquired Nextdoor (NYSE: KIND) publicly traded Class A common stock between July 6, 2021 and November 8, 2022, both dates inclusive, and suffered substantial losses, and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at investors@dicellolevitt.com. 

The deadline to apply to the Court to serve as a lead plaintiff in the Nextdoor lawsuit is April 29, 2024.

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