Sonder debuts on public markets

Hospitality company Sonder will list on the NASDAQ tomorrow January 19 via a special purpose acquisition company (SPAC) created through a business combination with Gores Metropoulos II.

San Francisco-based Sonder, founded in 2014, was valued at $1.9 billion as of October 2021. Its common stock will list with the ticker symbol SOND.

The SPAC deal brings in approximately $310 million in PIPE (private investment in public equity) capital from investors including Gores Metropoulos II, Fidelity Management & Research LLC, funds and accounts managed by subsidiaries of BlackRock, Atreides Management and Senator Investment Group. Sonder says it will also draw on $165 million of delayed draw notes, and it will have up to $450 million in cash in Gores Metropoulus II’s trust account.

In the third quarter of 2021, Sonder reported revenue of $67.5 million, $126 of RevPAR and raised its outlook for total 2021 revenue to from $200 to 205 million.

“While the travel industry has faced headwinds with the ongoing pandemic, Sonder has continued to grow at a rapid clip, proving the resiliency of our business model and demonstrating our ability to pivot quickly to address emerging trends and traveler needs. We delivered record quarterly revenue in both Q2 and Q3 and we remain aggressively optimistic on the future of travel,” says Francis Davidson, Sonder co-founder and CEO.

“Today is a historic moment for the entire Sonder team and a testament to how we’ve revolutionized the hospitality industry by reimagining and delivering what the modern traveler demands. We are really proud of what we’ve achieved to date and want to recognize the dedication of all Sonderites. We have an exceptional team in place to drive the next chapters of growth for our organization.”

Sonder’s more than 16,000 accommodations, ranging from rooms to fully equipped suites and apartments, are located in more than 35 markets across 10 countries. The company added more than 25 new buildings across the United States in the second half of 2021.

Davidson, one of PhocusWire’s Travel Movers and Shakers for 2022 , founded Sonder while in college in Montreal. In its investor presentation, the company says it plans to grow to 77,000 units and more than 30% property level profit margin by 2025.