The collapse of aparthotel company Sonder Holdings and the headache it's caused Marriott International have been making headlines lately, but there's a long story behind how these companies got here.
Last month, Marriott announced it was terminating its 20-year licensing agreement with Sonder. Soon after, Sonder announced it was ceasing operations and would initiate liquidation proceedings. A court filing by Marriott in Sonder's bankruptcy case shed some light into the final weeks of Sonder, but it took years to get to this point.
The following is a summary of Sonder’s public reporting through news releases, quarterly earnings reports and other U.S. Securities and Exchange Commission filings, in order chronologically starting with the company’s April 2021 announcement to go public through acquisition by a special purpose acquisition company.
Most of the included links connect to SEC filings or news releases hosted on online wire services. A few, however, link directly to Sonder’s website because they do not exist elsewhere, so they may at some point become unavailable.
A full list of Sonder's SEC filings can be found here.
2021
April 30: Sonder, a privately held company launched in 2014, enters into a definitive agreement to combine with Gores Metropoulos II, a SPAC sponsored by an affiliate of the Gores Group, a global investment firm, and an affiliate of Dean Metropoulos of Metropoulos & Co., a family-owned investment firm. Additional investors led by an affiliate of the Gores Group commit $200 million through purchasing shares of common stock of GM II in a private placement. The companies anticipate the expected pro-forma enterprise value of the combined company would be $2.2 billion with more than $700 million of net cash at closing. Sonder projects roughly $4 billion in revenue in 2025, four years later.
July 7: Sonder reports first-quarter 2021 revenue of $31.6 million, up 11% compared to the fourth quarter of 2020. It achieved revenue per available room of $77, amounting to 64% of its first-quarter 2019 level and 78% of the first quarter of 2020. It has approximately 5,000 live units and more than 13,000 total live and contracted units as of May 31. Sonder notifies the SEC on May 18 it needs to file the quarterly Form 10-Q late.
Aug. 10: In its second-quarter 2021 earnings release, Sonder reports revenue of $47.3 million, a 151% year-over-year increase. RevPAR grew 112% year-over-year to $100, a 30% increase from the first quarter. The company raises its full-year total revenue outlook to $180 million to $190 million, up from its initial outlook of $173 million. As of June 30, it had 5,500 live units and about 15,00 total live and contracted units. The company expands its presence into Amsterdam, its seventh city in Europe.
Oct. 28: Sonder Holdings Inc. and Gores Metropoulos II announce amendments to their definitive agreement to combine. The combined company’s pro forma enterprise value will be $1.925 billion, and Sonder will receive about $110 million in additional capital from affiliates of Gores Metropoulos and other investors. This is in addition to the $200 million in previously announced private investment in public equity. Sonder signs a non-binding term sheet for delayed draw notes of $220 million with existing PIPE investors in order to fund growth in the coming years.
Nov. 9: Sonder reports $67.5 million in revenue for the third quarter of 2021, a 155% year-over-year increase. It achieved RevPAR of $126, a 64% year-over-year increase and a 26% increase compared to the previous quarter. It again raises its full-year 2021 total revenue outlook, forecasting $200 million to $205 million. It has roughly 6,300 live units and more than 16,000 total live and contracted units as of Sept. 30. During the quarter, it launches operations in France, expands its presence in Mexico City and grows its footprint in the Middle East with two new high-rise towers in downtown Dubai.
Dec. 23: Sonder and Gores Metropoulos II share the SEC declared effective the day before its registration statement on Form S-4. Gores Metropoulos II schedules a special meeting with stockholders to seek approval of the agreement and plan to merge for Jan. 14, 2022.
2022
Jan. 18: Sonder completes its merger with Gores Metropoulos II following a special meeting of Gores Metropoulos II stockholders on Jan. 14. It begins trading on the Nasdaq Global Select Market the next day under the ticker symbols SOND for its common stock and SONDW for publicly traded warrants.
March 9: For the fourth quarter of 2021, Sonder reports $86.7 million in revenue, a 204% year-over-year increase but a $77.3 million net loss, a 7% year-over-year decrease. It also experiences a loss of $58.5 million in adjusted earnings before interest, taxes, depreciation and amortization, a 1% increase year over year but a 23% drop compared to the previous quarter. For the full year of 2021, its revenue was $232.9 million, a 101% year-over-year increase with a $294.4 million net loss, an 18% year-over-year decrease. Its adjusted EBITDA loss was $217 million, a 3% decrease compared to the year before. As of Jan. 31, Sonder reports 7,600 live units, a 69% increase compared to the year before, and 18,100 combined live and contracted units. At the time, Sonder employs 1,600 people across the organization.
May 16: For the first quarter, Sonder reports revenue of $80.5 million, up from $31.6 million in the first quarter of 2021. Net income was $22.4 million, up from the previous year’s net loss of $78.5 million. It saw negative operating cash flow of $53 million and negative free cash flow of $65 million. Occupancy reached 73%, a 700-basis-points improvement, and RevPAR of $117, a 52% year-over-year increase. At the end of the quarter, Sonder's portfolio includes 7,700 live units and 11,600 contracted units.
June 9: Sonder announces a new Cash Flow Positive plan that prioritizes reaching positive quarterly free cash flow by 2023 without the need for additional fundraising and preserving a “robust cash cushion.” It plans to cut costs by about $85 million on an annualized basis, reduce its planned signings pace and drive growth mostly through opening its already contracted units, improve growth quality through increasing its standards for incremental signings targeting 100% capital light and focusing on RevPAR initiatives.
Aug. 2: Sonder appoints Deeksha Hebbar as chief operating officer and Chris Berry as senior vice president and chief accounting officer. Hebbar was previously Sonder’s senior vice president of operations and had held roles at Google and McKinsey & Co. Berry was previously the chief accounting officer at Alaska Air Group.
Aug. 10: For the second quarter, Sonder reports $121 million in revenue, a 157% year-over-year increase, and a net loss of $43.7 million as compared to a net loss of $73.9 million the year before. It also saw a loss in operating cash flow of $41 million and loss of $45 million in free cash flow. Sonder reports RevPAR of $167, a 67% year-over-year increase due to occupancy reaching 82%, a 1,400-basis-point increase, and ADR of $203, a 38% increase. Its portfolio grows to about 8,400 live units and 10,300 contracted units.
Oct. 17: Sonder announces that company President and CEO Sanjay Banker will leave his executive roles to join the company’s board of directors starting Jan. 1, 2023, and become senior adviser to the company for a one-year period.
Nov. 9: For the third quarter, Sonder reports revenue of $125 million, an 85% year-over-year increase, but a net loss of $74.5 million as compared to a net loss of $64.6 million the year prior. The company also reported a negative $32 million in operating cash flow and negative $39 million in free cash flow. RevPAR was $158 million, a 25% year-over-year increase, with occupancy at 84%, a 1,600-basis-point improvement, and ADR of $189, a 2.7% increase. It has 9,000 live units in its portfolio and 9,900 contracted units.
Nov. 23: Sonder publicly discloses a data security breach in which someone gained unauthorized access to one of its systems that included certain guest records. Once the company discovered this breach, Sonder removed access from this individual, verified operations were not affected and began investigating the scope and impact. Among the guest information potentially accessed in the breach were usernames and encrypted passwords; full names; phone numbers; addresses; certain guest transaction receipts, including the last four digits on credit cards; and copies of government-issued identification, such as driver’s licenses or passports.
2023
March 1: For the fourth quarter of 2022, Sonder reports revenue of $135 million, a 56% year-over-year increase, while net loss was $54.8 million, an improvement compared to its net loss of $77.3 million the year before. Operating cash flow was negative $25 million and free cash flow was negative $30 million. Occupancy reached 83%, a 1,400-basis-point improvement while ADR dipped 7% to $191, resulting in RevPAR growing 11% to $158. For the full year, Sonder's revenue was $461 million, up from $232.9 million in 2021, and it had a net loss of $150.7 million as compared to a net loss of $294.4 million the year before. As of Dec. 31, 2023, Sonder has 9,700 live units with 7,900 contracted units. Its total number of employees include 993 people in the U.S. and about 702 in nine countries outside of the U.S.
March 6: Sonder appoints Dominique Bourgault as chief financial officer. At his previous role, Bourgault was chief financial officer at Blue Nile, a retailer in online diamonds and jewelry.
March 10: After the collapse of Silicon Valley Bank, Sonder reports $289 million in cash and restricted cash as of Dec. 31, 2022, over half of which was held in a AAA-rated BlackRock money market fund. As of March 9, 2023, it has about $2 million in an operating cash account and approximately $20 million in deposit accounts with Silicon Valley Bank. It also holds a $60 million line of credit facility with the bank issued over the normal course of business, of which it was using $13 million through letters of credit.
March 22: Sonder begins accepting group bookings as an expansion of its business travel segment. It partners with HelmsBriscoe, a company specializing in meetings procurement and site selection.
May 10: For the first quarter of 2023, Sonder reports revenue of $120.7 million, up from $80.4 million the year prior. It also reports a net loss of $86.4 million compared to net income of nearly $11 million in the first quarter of 2022. Operating cash flow was negative $35 million and free cash flow was negative $41 million. It achieved occupancy of 80.4%, a 7.3% year-over-year increase, grew ADR 7% to $167 and RevPAR by 17% to $134. Its portfolio includes 10,400 live units and 7,900 contracted units.
July 25: Sonder launches its first hotel collection called Powered by Sonder. The collection includes 23 boutique hotels that use Sonder’s technology and its management teams.
Aug. 9: For the second quarter, Sonder reports revenue of $157.4 million, up from $121.3 million the year before, but a net loss of $45.3 million as compared to a net loss of $45.7 million in 2022. Its operating cash flow was negative $25 million with free cash flow of negative $27 million. Occupancy remained flat at 82% while ADR dipped 3% to $200 and RevPAR decreased by 2% to $164. At the time, its portfolio includes 11,100 live units and 6,300 contracted units.
Sept. 20: Sonder enacts a 1-for-20 reverse stock split for its common stock to regain compliance with Nasdaq’s requirement of a $1 minimum bid price per share.
Oct. 3: Sonder appoints Adam Bowen as chief accounting officer effective Oct. 9. Bowen was most recently vice president and chief accounting officer for BlueLinx Holdings.
Nov. 14: For the third quarter, Sonder reports revenue of $161 million, a 29% year-over-year increase, and a net loss of $64.3 million, up from a net loss of $73.3 million the year before. It had operating cash flow of negative $13 million and free cash flow of negative $16 million. Its portfolio saw occupancy decline 1% year over year to 83%, ADR drop 4% to $185 and RevPAR fall 5% to $153. It has 11,800 live units and 5,300 contracted units.
Dec. 11: Sonder appoints board member Tom Buoy as executive vice president and chief commercial officer.
2024
March 15: Sonder delays its fourth-quarter and full-year 2023 earnings report, stating it identified “accounting errors related to the valuation and impairment of operating lease right of use assets and related items” for fiscal years 2022 and 2023. The company says it will need additional time to restate both years’ financial statements, but anticipates the restatements will increase Sonder’s overall net loss and loss per share in the impacted periods. Sonder also shares some estimated and unaudited financial highlights from the fourth quarter and full year of 2023, including revenue amounting to $164 million in the quarter and $603 million in the full year. Its RevPAR was $150 for the quarter and $151 for the full year. Its operating cash flow was negative $34 million for the quarter and negative $108 million for the year, and free cash flow was negative $35 million and negative $119 million, respectively. Sonder's portfolio includes 12,200 live units and 3,800 contracted units. It reports having 905 employees in the U.S. and 737 in nine countries outside of the U.S.
March and April: Following Sonder’s announcement it needed to delay its most recent earnings report, multiple law firms announce investigations into Sonder on behalf of shareholders, with several later announcing the start of class action lawsuits.
April 2: Nasdaq warns Sonder that because it was delinquent in filing its 2023 Form 10-K, it is out of compliance with one of Nasdaq’s listing rules and risks being delisted. Sonder has 60 calendar days to come into compliance.
May 10: Sonder informs the SEC it is unable to file its first-quarter 2024 10-Q form on time.
May 16: Nasdaq warns Sonder that because it was delinquent in filing its first-quarter 2024 Form 10-Q, it is out of compliance with one of Nasdaq’s listing rules and risked being delisted. Sonder has 60 calendar days to come into compliance.
Aug. 9: Sonder informs the SEC it is unable to file its second-quarter 2024 10-Q form on time.
Aug. 19: Sonder signs a 20-year strategic licensing agreement with Marriott International that would allow travelers to book Sonder’s units through Marriott’s booking platforms. Sonder also announces it will receive a total of $146 million in additional liquidity through a consortium of investors who committed to purchase $43 million of designated series of convertible preferred equity, existing noteholders providing $83 million in additional liquidity and other sources giving $20 million. That is in addition to a previously announced $16 million in financing from existing noteholders.
Aug. 15: Sonder receives a notice from Nasdaq that it is out of compliance with one of its listing rules because it is delinquent in filing its second-quarter 2024 10-Q Form and risks being delisted. It has until Aug. 30 to submit an update to its original plan to regain compliance with respect to its delinquent filings.
Aug. 27: Sonder files its delayed 10-K Form for the fiscal year ending Dec. 31, 2023. Along with corrected financial figures, the company outlines the risks it faced, both those inherent to the hospitality industry as a whole and those specific to Sonder. The company says it incurred net losses and negative cash flow for years since its inception and that it may not be able to achieve or maintain profitability or positive cash flow in the future. Its accumulated deficit as of Dec. 31, 2023, is $1.4 billion.
Oct. 1: A letter from Nasdaq’s Listing Qualifications Department to Sonder states the company's common stock and warrants would be suspended from trading starting Oct. 10 because Sonder remains delinquent in filing its quarterly reports on Form 10-Q for the first and second quarters of 2024 by the Sept. 30 deadline to regain compliance. Nasdaq also files with the SEC to remove Sonder’s securities from listing and registration with the Nasdaq Stock Market. On Oct. 2, Sonder submits an appeal to Nasdaq to present a plan to regain and maintain compliance. The appeal automatically suspends any delisting until Oct. 23.
Oct. 23: Nasdaq notifies Sonder its hearing panel granted Sonder’s request to stay the suspending of trading and delisting pending its appeal hearing, which is scheduled for Nov. 14.
Nov. 4: Sonder files its quarterly report Form 10-Qs for the first and second quarters of 2023. Chief Financial Officer Dominique Bourgault announced he will resign effective Dec. 2. Days later, on Nov. 7, Chief Accounting Officer Adam Bowen announces he will resign effective Dec. 31.
Nov. 11: Sonder notifies the SEC it would be unable to file its quarterly report Form 10-Q for the third quarter of 2024 on time.
Nov. 20: Nasdaq notifies Sonder it is delinquent in its filing of its quarter report Form 10-Q for the third quarter of 2024 and risks being delisted.
2025
Jan. 21: Sonder appoints Michael Hughes as chief financial officer. Hughes was previously the chief financial officer for Spirit Realty Capital, a real estate investment trust, as well as for FelCor Lodging Trust.
Feb. 12: Sonder reports its third-quarter 2024 financial results. The company says revenue was $162 million, a 1% year-over-year increase, but it incurred a net loss of $179 million, a 211% year-over-year increase that included a $58 million loss on preferred stock issuance and an $87 million change in fair value of the forward contract relating to its August 2024 securities purchase agreement for $43 million of new convertible preferred equity. Its adjusted free cash flow was negative $11 million, a 33% year-over-year increase. Its total cash, cash equivalents and restricted cash is $76 million, including $49 million in restricted cash. In its portfolio, it has approximately 10,100 live units with another 1,100 contracted units.
March 31: Sonder notifies the SEC it would be unable to file its annual report on Form 10-K for the period ending Dec. 31, 2024, on time.
April 15: Sonder sells roughly $18 million shares of its Series A preferred stock and makes amendments to its existing note and warrant purchase agreement that reduced its outstanding principal balance by 15% and about 50% of its interest rate. The company says it plans full integration into Marriott’s system by the end of the second quarter. Sonder receives $7.5 million in key money from Marriott and enacts about $50 million in annualized cost reductions through the Marriott integration.
April 29: Nasdaq notifies Sonder it is delinquent in filing its annual report on Form 10-K for the period ending Dec. 31, 2024, and risks being delisted.
May 15: Sonder notifies the SEC it would be unable to file its quarterly report on Form 10-Q for the period ending March 31, 2024, on time.
May 29: Nasdaq notifies Sonder that it is delinquent in filing its quarterly report on Form 10-Q for the period ending March 31,2024, and risks being delisted.
June 23: Sonder completes the integration of its hotel and apartment units into Marriott’s booking channels.
June 25: Sonder announces CEO and board member Francis Davidson is leaving both his roles with the company effective immediately. The board appoints Chairperson Janice Sears as interim CEO.
July 24: Sonder files its annual report Form 10-K for the year ending Dec. 31, 2024. For the full year, its revenue was $621.3 million, up from $602 million the year before, but it had a net loss of $244 million as compared to a net loss of $ $295.7 million in 2023. It had a cash balance, not including restricted cash, of $20.8 million held for working capital purposes. In the report, Sonder’s executives state that “We believe that our existing cash on hand combined with our anticipated estimated adjusted free cash flow may be insufficient to fund our operations and debt obligations for at least the next 12 months. Our management has concluded there is substantial doubt about the company’s ability to continue as a going concern, which is not alleviated, for one year from the date of issuance of this annual report on Form 10-K.” Sonder reports it has 704 employees in the U.S. and 717 employees in 13 countries outside of the U.S.
Aug. 5: Sonder issues and sells $24.54 million of units, which included a senior secured promissory note and a warrant to purchase shares of Sonder’s common stock at an exercise price of $1.50 per share. The investor notes mature July 4, 2026, and accrue interest on the unpaid amount at a rate of 15% per annum. It enters into a third amendment to its license agreement and related loan agreement with Marriott that replaces certain fees and other amounts owed to Marriott for up to one year with payment obligations under senior secured notes. It also modifies its agreement with Silicon Valley Bank by terminating its loan and security agreement with the bank while maintaining letters of credit.
Aug. 14: Sonder notifies the SEC it would be unable to file its quarterly report Form 10-Q for the period ending June 30, 2025, on time. Chief Financial Officer Michael Hughes notifies Sonder on Aug. 8 of his resignation from the company effective Aug. 15. Interim CEO Janice Sears assumes his role as the company’s principal financial officer.
Aug. 25: Sonder releases its first-quarter 2025 earnings results. It reports revenue of $118.9 million, an 11% year-over-year decrease. Its net loss was $56.5 million, a 12% year-over-year increase. Its adjusted EBITDA was negative $56.7 million, a 1% year-over-year decrease, and its adjusted free cash flow was negative $6.9 million, a 76% year-over-year increase. It reported total cash, cash equivalents and restricted cash of $66.5 million, which included $43.2 million in restricted cash. Sonder's portfolio includes about 9,400 live units as of March 31, and 650 contracted units.
Sept. 16: Sonder’s management and board of directors begin evaluating financing and other strategic alternatives in consultation with financial adviser Moelis & Co. and outside counsel. Sonder co-founder and Chief Real Estate Officer Martin Picard resigns in connection with plans to participate with certain investors to potentially bid on the company. Interim CEO Janice Sears begins overseeing operations.
Oct. 14: Sonder files its quarterly report Form 10-Q for the period ending June 30, 2025. It reports revenue of $147 million, down from $164.6 million the year before. Its net loss was $44.5 million as compared to a net loss of $32.7 million in 2024. For the quarter, it reported an occupancy rate of 85.5%, a 7.8% year-over-year increase, with ADR up 5.4% to $216 and RevPAR up 12.9% to $184. It reports having 8,300 live units as of June 30, a 19.4% decrease from June 30, 2024, due to its portfolio optimization program implemented in November 2023.
Oct. 21: Nasdaq notifies Sonder the company no longer meets the requirements of Nasdaq’s listing rule requiring listed securities to maintain a minimum Market Value of Publicly Held Shares of $15 million. Sonder has 180 calendar days to regain compliance by maintaining this value for 10 consecutive business days.
Nov. 5: Sonder’s board of directors postpones the 2025 annual meeting of stockholders scheduled for Nov. 6.
Nov. 14: Marriott notifies Sonder on Nov. 7 it is terminating its license agreement effective immediately. On Nov. 14, Sonder files voluntary petitions to start chapter 7 of title 11 of the United States Code, known as the Bankruptcy Code, in U.S. Bankruptcy Court for the District of Delaware.