Sonder leases apartments, designs them beautifully, and rents them out as hotel alternatives. Francis Davidson started it at 19 while at McGill University. The company went public via SPAC in 2022 at a $2.2 billion valuation and then the stock crashed 90%+ as losses piled up. The idea is compelling — better than a hotel, more consistent than Airbnb. The execution has been a masterclass in how fast a hospitality company can burn cash. Still alive, still growing, still losing money.
Founded
2014
HQ
San Francisco, USA
Total Raised
$560 million
Founder
Francis Davidson
Status
Public (NASDAQ: SOND)
Website
www.sonder.comTHE ORIGIN STORY
Francis Davidson was 19 and a student at McGill University in Montreal when he started renting out his apartment on Airbnb during summer breaks. He made enough to pay his rent and realized there was a massive opportunity in providing hotel-quality hospitality in residential apartments.
In 2014, he founded Sonder to do this at scale. The model: lease apartments in desirable neighborhoods, furnish them with consistent, modern design, and offer them as hotel alternatives with keyless entry, 24/7 support, and hotel-grade cleanliness.
Better than a hotel room, cheaper than a comparable suite.
WHAT THEY ACTUALLY DO
Sonder leases apartments through master leases with landlords, furnishes them, and rents them nightly on its own platform and through OTAs (Booking.com, Expedia). Revenue comes from nightly bookings minus lease costs, furnishing, and operations.
The unit economics are the key question: can the nightly revenue from bookings consistently exceed the fixed lease cost? In strong travel markets, yes.
In downturns, the fixed lease obligations become a burden.
THE PRODUCTS
Designed apartments in 40+ cities worldwide. Keyless self-check-in via app.
24/7 guest support. Consistent, modern interior design across all units.
Business travel and group booking options.
HOW THEY GREW
Rapid geographic expansion into high-demand urban markets — New York, San Francisco, London, Dubai, Barcelona. Partnerships with landlords who preferred a professional operator over individual Airbnb hosts.
Listings on major OTA platforms for distribution.
THE HARD PART
The lease model creates fixed costs that don’t flex with demand. During travel downturns (like COVID), Sonder still owed rent on thousands of apartments.
Losses have been significant — the company has never been profitable. The stock is down 90%+ from its SPAC price, and delisting risk is real if the share price stays low.
MONEY TRAIL
Series B
2018 · Led by Greenoaks Capital
$85M raised
Series D
2019 · Led by Fidelity
$210M raised
Series E
2021 · Led by Fidelity
$170M raised
SPAC IPO
2022 · Led by Gores Metropoulos II
$250M raised
$2.2B valuation
WHO BACKED THEM
Went public via SPAC (Gores Metropoulos II) in 2022 at a $2.2 billion valuation. Pre-IPO investors included Greenoaks Capital, Fidelity, Greystar, and Spark Capital.
Total funding of approximately $560 million.
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