SAN FRANCISCO—San Francisco hospitality startup Sonder announced on June 25, 2020 they have closed on a Series E round of $170 million led by Fidelity, WestCap, and Inovia Capital.
The company expressed in an internal blog post that they are expecting to raise additional capital, “from new and returning investors that will bring our Series E total to around $200 million.” This brings Sonder’s valuation up to $1.3 billion.
“This fundraise and valuation increase comes after the most severe downturn the hospitality industry has ever faced. While we expect the recovery from the pandemic to be long and difficult, with this latest round of funding, Sonder is well-positioned to help lead a re-invention of the travel industry in the months and years ahead,” the post added.
The hospitality giant got its start in 2012, when Francis Davidson decided to sublet his apartment over summer break during his freshman year at McGill University in Montreal.
According to the company’s website, after making a profit, during his sophomore year, Davidson and co-founder Lucas Pellan created the Sonder website to fill vacant student apartments with travelers
Since the launch of the company, Davidson has been in charge of managing units across 11 cities, and has earned more than $1 million in revenue. The company expanded and is now located in Silicon Valley.
In early March 2020, Sonder laid off 22 percent of its employees and furloughed another 11 percent, as first reported by The Information.
The layoffs impacted full-time staff in departments such as software engineers and furloughed staff were majority hourly paid hospitality workers.