Sonder Holdings Inc. (NASDAQ: SOND), a San Francisco-headquartered operator of short-term rental apartments and boutique hotels, announced a winding down of its operations immediately and the Chapter 7 liquidation of its US business while initiating insolvency proceedings in the international countries in which it operates.
In a statement, the company said it “faced severe financial constraints” from the integration of its systems and booking arrangements with Marriott International (NASDAQ: MAR), which announced that it terminated its licensing agreement with Sonder, deeming it no longer in effect. The company claimed that it “was unable to execute a viable going concern transaction for its business and operations or obtain additional liquidity,” thus speeding the decision to liquidate its’ business.
Sonder properties were based in 37 cities across nine countries. The company was founded in 2014 and went public in 2022 through a SPAC merger. Sonder’s licensing agreement with Marriott was signed in August 2024 and was designed to run for 20 years.
“We are devastated to reach a point where a liquidation is the only viable path forward,” said Janice Sears, interim CEO. “Unfortunately, our integration with Marriott International was substantially delayed due to unexpected challenges in aligning our technology frameworks, resulting in significant, unanticipated integration costs, as well as a sharp decline in revenue arising from Sonder’s participation in Marriott’s Bonvoy reservation system. These issues persisted and contributed to a substantial and material loss in working capital. We explored all viable alternatives to avoid this outcome, but we are left with no choice other than to proceed with an immediate wind-down of our operations and liquidation of our assets.”
Sears continued, “The board and I are deeply grateful to our employees for their longstanding dedication to putting the guest experience at the center of everything we do. Due to their passion and effort, Sonder spent the last decade redefining hospitality with remarkable and accessible guest stay experiences. On behalf of the entire Sonder team, we express our gratitude to our guests and partners for their business and support over the years.”
