Facebook Takes Aim At Neighborhood-Focused Nextdoor With New Service

Facebook Inc FB is working on a service that would let its users connect with their neighbors in an effort to spur closer interactions among people who dwell in proximity to each other, Bloomberg reported Tuesday.

What Happened: The new feature will allow the Mark Zuckerberg-led company to offer similar services to those of Nextdoor Inc, which is planning an initial public offering, according to Bloomberg.

Social media industry commentator Matt Navarra shared screenshots of the new feature on Twitter on Tuesday, first noticed on Bloomberg.

A spokesperson for Facebook told Bloomberg that the company was rolling out a “limited test of Neighborhoods.”

A Hong Kong-based independent feature discoverer Jane Manchun Wong had shared an earlier version of Neighborhoods in May.

Why It Matters: The launch comes at a time when Nextdoor has raised $470 million in funding and is exploring going public through different options, including a direct listing, but has rebuffed blank-check companies, Bloomberg reported.

The company is reportedly pursuing a valuation of $5 billion.

The San Francisco-based Nextdoor reportedly serves more than 268,000 neighborhoods globally, with a quarter of those in the United States, as per Bloomberg.

Users in Nextdoor's neighborhoods can sell used goods or even post about local events, as per Bloomberg.

This is not the first time Facebook has launched a feature that mimics a rival. In July, the Mark Zuckerberg-led company launched Instagram Reels to take on TikTok.

Last year the company launched its dating service to compete with Match Group Inc’s MTCH Match.com and Tinder.

This month a Democrat-led congressional subcommittee questioned Facebook’s “killer acquisitions” of rivals and demanded a prohibition on large tech giants from entering into adjacent lines of businesses.

Price Action: Facebook shares traded 2.9% higher at $275.25 in the after-hours session on Tuesday.