Airbnb competitor Sonder says after new funding round it’s now worth $1B

Sonder, a San Francisco-based startup that leases apartments and flips them into short-term rentals, closed on a $210 million funding round.

TRD NATIONAL /
Jul.July 11, 2019 08:00 AM
Sonder CEO Francis Davidson and 20 Broad Street

Sonder CEO Francis Davidson and 20 Broad Street

A hotel-room-style listing startup just obtained unicorn status.

Sonder, a San Francisco-based startup with a platform that leases apartments and transforms them into furnished short-term rentals, closed on a $210 million funding at a $1 billion valuation, the company said Thursday.

Sonder’s big funding round signals confidence in the hospitality startup that is competing with Airbnb, which largely draws income from fees it charges renters and hosts.

Unlike Airbnb, Sonder relies on an asset-heavy model that draws some comparisons to WeWork, which also leases space, outfits them and then rents them to end users.

Sonder entered the New York market last year after signing a lease at 20 Broad Street and has side-stepped the city’s strict short-term rental laws by occupying buildings that meet the zoning and building requirements of a hotel.

Airbnb, which is now valued around $38 billion, has been forced to tighten its policies in the city, where the laws restrict short-term rentals unless the owner of a home lives there.

Sonder says that it manages more than 8,500 units in 711 buildings. It currently has locations in 20 cities and said it recently signed leases in Philadelphia, Chicago, Seattle, Dubai and Dublin.

The company has raised a total $400 million, which includes an $85 million series C fundraise last August. The latest funding round was backed by Fidelity, Valor Equity Partners, Atreides Capital, ARod Corp and the Pritzker family through Tao Capital Partners. Its early stage investors, Spark Capital and Greenoaks Capital, also participated.

In addition to the $210 million fundraise, an additional $15 million in equity will be provided by developers who are partnering with the firm.


Related Articles

arrow_forward_ios
From left: Mayor Bill de Blasio, 54 West 39th Street, 62 Grand Street, and 208 West 30th Street (Credit: Google Maps)

The Airbnb crackdown continues: City targets three more buildings

Mayor Bill de Blasio and Stanley “Skip” Karol, an Airbnb host (Credit: Getty Images and Youtube)

Airbnb host narrowly clears hurdle in First Amendment claim against city

A West Village Airbnb listing (Credit: Airbnb)

Airbnb Luxe launched without listings in one of their biggest potential markets — why?

Airbnb CEO Brian Chesky (Credit: Getty Images, Airbnb)

Airbnb, once profitable, lost $322M in 9 months

Harvey Hernandez fights back against Airbnb

Harvey Hernandez fights back against Airbnb

Harvey HHernandez (Credit: Airbnb)

Airbnb sues Miami partner in branded apartments concept

The agreement was signed today at UBC’s New York Council offices in Manhattan by Nathan Blecharczyk, Airbnb co-founder, Chief Strategy Officer, and Frank Spencer, General Vice President of UBC.

Airbnb hammers out partnership with carpenters’ union

Airbnb hosts score 34K bookings for Super Bowl LIV — more than for Art Basel

Airbnb hosts score 34K bookings for Super Bowl LIV — more than for Art Basel

arrow_forward_ios
Loading...