Sonder, a rental startup, has reached a valuation of over $1 billion after its latest funding round, according to a report by TechCrunch.
The company rents boutique apartments that are like hotel rooms, and allows people to stay in them anywhere from two day to two years. The company recently raised $225 million, and it has raised $400 million to date.
Investors include Valor Equity, Westcap and Nicolas Pritzker via Tao Capital Partners, and there was also participation in the round from Fidelity, Atreides Capital, ARod Corp, Spark Capital, Inovia Capital and Greenoaks Capital.
The company said it has been expanding rapidly, and it has grown the number of rentable units threefold in the last year. It has 8,500 spaces in 20 cities all across the globe, with plans for more.
The company, which is based in San Francisco, said that it expects to see a $400 million revenue run rate by the end of the year. The company provides amenities similar to hotels in completely furnished apartments.
“The future of hospitality will be dynamic,” Sonder Co-founder and Chief Executive Officer Francis Davidson said. “It will demand flexibility. And that’s what our diverse, unique and adventure-seeking world is like too. That’s why, while our spaces will continue to take on new forms and expand to exciting neighborhoods around the world, a Sonder will always be unforgettable.”
The company was founded in 2012 when Davidson was still a freshman at McGill University. The rental space is heating up as Airbnb is preparing for an IPO, and investors are searching for the next up and comer.
A hotel startup in India called Oyo was recently heavily invested in, including some capital from Airbnb, and a hotel company called Life House also recently raised $40 million. Mint House, a company that aims to give people a better hotel experience, recently raised $15 million.