Sonder shuts down

First WeWork, then Selina, and now Sonder. Three major brands and disruptors of their respective markets – each built on the vision of asset-light scalability, and each derailed by the realities of structural weakness.

Sonder’s immediate wind-down and planned Chapter 7 liquidation of its US business follows Marriott’s termination of its licensing agreement. The partnership – where Marriott wanted reach and Sonder needed credibility – was arguably doomed from the start. 

Marriott’s value lies in trust, consistency, and loyalty, all built over decades. By contrast, Sonder’s model was designed for speed and scale, relying on technology to manage operations across thousands of units. This startup infrastructure led to “prolonged challenges in the integration of [Marriott’s] systems and booking arrangements” with Sonder facing “severe financial constraints” as a result. The decision was then made to immediately wind down its operations and liquidate assets. 

Sonder’s rise and fall illustrates the broader challenges of scaling an asset-light, tech-driven accommodation business in an uncertain market. Similar patterns were seen with WeWork and Selina – rapid expansion, driven in part by over-valued business models and compounded by investor and economic pressure. All three companies went down the SPAC route – all three have foundered. 

What will happen with the existing Sonder inventory? More importantly, Sonder’s hundreds of employees. I’ve seen the likes of AvantStay, StellaStays, Guesty, City Pop, among others, share encouraging messages of support to those now looking for work. The fundamentals of the sector (investor appetite, operational efficiency, growing demand) remain strong, and experienced staff are now entering a market primed to absorb talent and expertise. With resilience comes opportunity. 

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