Airbnb competitor Sonder reaches unicorn status in latest fundraising round
- Sonder, an Airbnb competitor, said it has closed a $210 million Series D funding round. This brings the firm's total valuation north of $1 billion, with $400 million raised.
- The company said it quadrupled its rentable space since last year and is projecting $400 million in revenue this year, up four-fold from 2018.
- Airbnb's former CFO, Laurence Tosi, is joining Sonder's board. Tosi left Airbnb in 2018 after reports of internal clashes with CEO Brian Chesky.
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Short-term apartment rental company Sonder said on Thursday it has closed a $210 million Series D funding round that brought the Airbnb competitor's valuation north of $1 billion.
Fundraising now totals $400 million, and the latest round was led by new investors Valor Equity Partners, Westcap, and Tao Capital Partners with participation from Fidelity Investments, Atreides Capital, ARod Corp, Spark Capital and Greenoaks Capital.Sonder said it now has 8,500 rentable spaces in 20 cities, up from 2,200 in August 2018 in 12 cities.
The company also announced a forthcoming $15 million investment with select developers who will work with Sonder on new deals in undisclosed cities. Sonder is projecting $400 million in revenue for 2019, four times its 2018 figures.
Sonder combines Airbnb-like apartment and home rentals with hotel-like accommodations. The company usually purchases units directly from building owners or developers, but will also lease properties. It is the leader in this hybrid space, with competitors like Airbnb-funded Lyric and Marriott's Homemaker.
Sonder will also be adding WestCap founder and former Airbnb CFO, Laurence Tosi, to its board. Tosi left Airbnb in 2018 after reports of internal clashes with CEO Brian Chesky.
Airbnb, now 11 years old, is contemplating an IPO, though the timing is uncertain.The company is valued around $31 billion, but has faced legal issues related to local rules around short-term rentals.Earlier this year, multiple New York real estate companies were sued for $21 million for violating a city law that forbids short-term rentals of most apartments for less than 30 days.
Sonder has been able to zone some of their rentals as hotels so that they can provide legal short-term rentals, The Real Deal reported.