Today we’re thrilled to announce that Neighborly raised a $25 million Series A round to further our mission of modernizing public finance. The investment was led by Joe Lonsdale at 8VC, Laurene Powell Jobs at Emerson Collective, with follow-on participation from Ashton Kutcher at Sound Ventures, Maven Ventures, Bee Partners, and Stanford University. We welcome newcomers Govtech Fund, Abstract.vc, and Fintech Collective.
Thank you to all of our investors for joining and mentoring us on our mission. You are visionaries who stand with us on our quest to do well financially by doing good for our nation’s communities.
Neighborly modernizes access to public finance. We connect borrowing communities with investors of every type, allowing cities to more easily issue debt and allowing community members to invest directly in their communities.
Now is the time to modernize public finance. Our nation faces three converging forces:
- Increasing borrowing costs: As the Federal Reserve begins hiking interest rates, communities will face higher borrowing costs, making it more expensive to finance public projects.
- Significantly reduced federal funding: This comes at a time when the current administration is getting ready to roll out a number of spending cuts that will drastically reduce the amount of funding available to the nation’s communities.
- Growing public project backlogs: With an ever-growing backlog of projects, communities will have to make painful tradeoffs between vital public works.
These costly choices mean potentially sacrificing parks, art programs, critical infrastructure projects, and other civic amenities that make up the backbone of our nation’s communities. Things once taken for granted in American life now seem to disintegrate at quickening pace.
It doesn’t have to be this way. Our nation holds more than enough wealth and will power to fix these problems. Supporting municipal finance is a nonpartisan effort – something that both sides of the aisle can (and do) get behind. The current financial system is set up in a way that disadvantages and costs communities much more than needed. Every basis point in the cost of issuance and borrowing means hundreds of millions of dollars per year that go to paying interest or banker bonuses. Since the cost of borrowing is so high, municipalities often delay important projects or even forgo them entirely. Consequently, our nation’s communities are unable to attend to some of the most underserved causes: schools resort to cutting critical educational programs, communities do without recreation centers, utilities and energy infrastructure remain dilapidated.
That’s why we believe that public finance is the most important capital market. Yet the $3.8 trillion municipal bond market still relies on telephones and fax machines. When we empower investors and broaden communities’ access to capital, we see a future in which communities can borrow what they need when they need it, without the high fees.
This year has already been an inflection point for public finance. Since the start of the year Neighborly has financed nearly $25 million for communities, from California to Massachusetts, for public projects including bike lanes, building renovations, energy efficiency upgrades, and conservation.
We’re a team of passionate engineers and capital markets professionals dedicated to solving some of world’s most challenging problems in technology, government, and finance. If you’re a star engineer or finance professional interested in unleashing trillions of dollars in global capital to create the next generation of public projects, join us on our mission!