Short-term apartment rental company Sonder has
closed a $170 million Series E round, which brings its valuation to $1.3
billion.
The funding was led by Fidelity, Westcap and Inovia
Capital, and Sonder says in the coming weeks it expects to raise additional
capital from new and returning investors that will bring the round to a total
of about $200 million.
In a statement announcing the funding, the company
calls it “validation of the progress we’ve made on the strategies we outlined
at the outset of the pandemic to ensure Sonder would survive the crisis and
emerge a stronger company.”
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Those strategies include a shift from focusing on
stays of up to seven nights to targeting stays of more than 14 days, serving those affected by the crisis such as critical care
personnel and students in need of housing.
“Deployed
in mere days following the first travel restrictions, this initiative was
essential to our success over the last few months, leading to a
higher-than-average occupancy rate of no less than 40% at the height of the
pandemic,” the company says.
Sonder
has also implemented full credits for future bookings for cancellations of
reservations made direct on its site. Additionally, the company has taken cost-cutting
measures including layoffs, furloughs and pausing new lease signings and
property openings.
Sonder
says its priority with the new funding is to scale “carefully and responsibly.”
The company currently has 12,000 units in 28 cities and just under 1,000
employees.
Its
last fundraising round was a Series D in July 2019
for $210 million.
Check out this interview with Sonder CEO Francis Davidson for the How I Got Here podcast, recorded in October 2019.