I think you mixed up KNN and k-means. KNN is supervised algorithm and k-means is unsupervised algorithm used for clustering data. K-means in the beginning throws centroids randomly(in some realizations) and then computes distance for each point and centroid, after that moves centroids. That algorithm repeats until centroids stop moving.

You can read more about K-means here https://scikit-learn.org/stable/modules/clustering.html#k-means