Business context and reporting period
Important entity note: Despite the request metadata naming Nextdoor Holdings, Inc., this filing is for Khosla Ventures Acquisition Co. II (KVSB), a newly formed blank-check company (SPAC), not Nextdoor. It reports the period from inception on January 29, 2021 through March 31, 2021; it does not provide Nextdoor operating results.
The SPAC completed its IPO in March 2021 to fund a future business combination. It had not identified or completed a transaction in the information provided.
Financial results and position
- Revenue: None. The company reported no operating revenue and had not begun substantive operations.
- Net loss: $91,111, comprising $25,000 of formation costs, $16,111 of general and administrative expense, and $50,000 of franchise tax expense. Non-redeemable shares’ basic and diluted loss per share was $0.01; redeemable Class A shares’ earnings per share was $0.00.
- Cash flow: Operating cash used was $1.31 million; $416.34 million was placed in the trust account; financing activities provided $419.34 million. Period-end cash outside the trust was $1.69 million.
- Balance sheet and liquidity: Total assets were $419.32 million, including $416.34 million held in trust. Total liabilities were $14.72 million, including a $14.00 million deferred underwriting fee payable. Management reported a working-capital deficit of approximately $1.61 million but said post-IPO resources were sufficient through the earlier of a business combination or one year from the filing.
- Debt and other obligations: No long-term debt or lease obligations were reported. A $124,686 sponsor-related promissory note outstanding at March 31 was repaid on April 7, 2021. No off-balance-sheet arrangements were reported.
- Margins: Not meaningful because the company had no revenue.
Changes versus prior comparable period
No prior-year comparable operating period is presented; the company was incorporated in January 2021. The quarter’s principal development was the IPO and partial over-allotment exercise, which generated gross public-share proceeds of approximately $416.34 million, alongside a private placement. Accordingly, the reported loss reflects formation and public-company setup costs rather than ongoing business operations.
Outlook, risks and unusual items
- The company’s stated objective was to complete a business combination; no earnings guidance or operating forecast was provided. A forward purchase agreement allows the sponsor to buy up to $10 million of shares at $10 per share at a transaction closing, subject to conditions.
- The company generally had 24 months from the IPO closing to complete a business combination, with an extension to 27 months described in the MD&A if certain agreement milestones were met. Failure to complete a transaction would generally require redeeming public shares and liquidating, subject to the filing’s terms.
- Public shareholders may redeem shares in connection with a business combination. The filing describes a minimum target-size requirement of 80% of trust net assets at the time of agreement, subject to stated exclusions, and a minimum net tangible asset condition at closing.
- Management said COVID-19 could adversely affect the company’s financial position, operations, or target search, but the specific impact was not determinable. Management stated that the IPO alleviated substantial doubt about the company’s ability to continue as a going concern.
- Trust funds were restricted pending a business combination or specified redemption events. The sponsor’s trust-indemnity obligation has exceptions, including for certain claims where a waiver is unenforceable.
Most important facts to verify
- Confirm the filing entity: KVSB, not Nextdoor Holdings, Inc.; do not treat these figures as Nextdoor’s financial results.
- Reconcile the deferred underwriting fee: the balance sheet reports $14.00 million, while the MD&A and offering disclosures cite approximately $14.57 million.
- Reconcile trust-account proceeds: financial statements report $416,344,118, while other filing passages cite $416,344,120.
- Confirm applicable business-combination deadline and extension conditions; the filing describes both 24- and 27-month timing.
- Review the IPO prospectus and transaction documents for redemption terms, sponsor share conversion/forfeiture provisions, and forward-purchase conditions.