Sonder: (neologism) The profound feeling of realising that everyone, including strangers passing in the street, has a life as complex as one’s own, which they are constantly living despite one’s personal lack of awareness of it.
Sonder are changing the face of hospitality with their creative-tech approach to homely, hotel-apartment designs. A more peaceful and private alternative to popular workaways such as Selina and Outsite, Sonder seek to change the game without sacrificing style.
Hotels are often standardised in a way that stifles character, while hosts and accessible apartment complexes may compromise on service. Sonder seek to bridge the gap while personalising services with an easy touch-point app; Check in, request fresh towels, and get dinner recommendations – all at the tap of a button.
Sonder believe that by eliminating inefficiencies as they grow, they can deliver hospitality that’s both remarkable and affordable. Because everyone should be able to have an extraordinary place to stay.
The Sonder Story
Then a university student in Montreal, Sonder co-founder and CEO Francis Davidson began managing a handful of apartments. He greeted guests with wine, parked their cars, and began to envision a new set of ideals around hospitality. Over the next few summers, Francis experimented with various models such as matching travelers with vacant student apartments across cities and managing other people’s apartments for short-term rentals. A few years later, he and co-founder Martin Picard solidified the foundation that would become the Sonder of today.
Sonder has multiple offices across the globe, with Hub cities in Denver, San Francisco, Montreal, London U.K., and Amsterdam. They’re personability comes from the fact that they’re a very locally driven organisation – celebrating each city’s unique heritage and its best kept secrets. What began as a journey to provide a better stay has grown into a celebration of modern design and charming comfort, using self-check-in technology to keep those spaces affordable as they bring Sonder to more places around the world.
Sonder are a billion-dollar company with the agility of a start-up (or at least a company half its size). Like many companies during COVID, teams across Sonder had to react and adapt in record time to ultimately ensure company survival during the initial shutdowns. The hospitality industry was particularly affected, and Sonder’s survival is testament to how talented their teams are – from the frontlines across their cities to HQ; everyone came together with the common mission of ensuring Sonder would survive, and eventually thrive, on the other side.
Investment Analysis is a mission-critical function for Sonder and is at the heart of how they make billions of dollars worth of decisions. Underwriting involves taking every potential real estate opportunity they might consider and transforming that opportunity into a thorough and interpretable financial model – the ultimate output of which is the financial metrics, context, and diligence that leadership needs to make an informed decision.
Their core focus has always been the same: underwriting as thoroughly and accurately as possible in a scalable way that supports smart growth. However, in 2020 they decided to revamp this process to improve essential rigour and consistency. Given the volume of deals they were underwriting in a given quarter, even small, incremental improvements could have a monumental impact when scaled. This includes many steps, but of note was the creation of an in-house tool to quickly aggregate relevant forecasting data points, reducing forecasting turn times and room for error (i.e. greater live feedback models assessing present value).
“Sonder is re-defining the accommodations market; there are no textbooks that ‘teach’ you how to underwrite Sonder’s revenue and costs. Every day we are learning how to better predict how customers value staying in a Sonder vs. a traditional hotel… Putting all of this together into a forecasting methodology is one heck of a challenge, and makes coming in each day incredibly stimulating.”
It’s easy to get stuck in a state of analysis-paralysis waiting until an idea is perfect before implementing, but quick actions or calibrations (even if not perfect) to fix a broken process are vital to Sonder’s success. There are countless textbooks that can teach someone how to underwrite traditional hotels. After all, big brand hotels have not changed much over the last few decades and therefore, the discipline of projecting revenue and costs at those branches can easily be templated and repeated – maybe even automated.
Sonder’s model captures the variability found in what customer’s value at a local level: across markets, neighbourhoods, and Sonder product; therefore the value propositions evolve over time to reflect the diversity of factors (internal and external) reshaping the industry.
“Sonder” Definition – noun. “the realisation that each random passerby is living a life as vivid and complex as your own – populated with their own ambitions, friends, routines, worries and inherited craziness – an epic story that continues invisibly around you like an anthill sprawling deep underground, with elaborate passageways to thousands of other lives that you’ll never know existed, in which you might appear only once, as an extra sipping coffee in the background, as a blur of traffic passing on the highway, as a lighted window at dusk (via the Dictionary of Obscure Sorrows).
The spirit of Sonder is to capture the diversity of experiences and needs that are inherent to the services they seek to provide. It’s easy to experience life through the limited lens of our own eyes, with ourselves at the centre, but we are, of course, part of everyone else’s stories as well; These stories are deeply intertwined and interconnected. And in subtle and sometimes not-so-subtle ways, we influence the trajectories of the people around us, those we have yet to meet and even those we will never get the chance to encounter. While we are writing our own script, we are also a part of a larger and endlessly unfolding story.
The word Sonder is credited to John Koenig, creator of The Dictionary of Obscure Sorrows. “Each original definition aims to fill a hole in the language – to give a name to emotions we all might experience but don’t yet have a word for. All words in this dictionary are new. They were not necessarily intended to be used in conversation, but to exist for their own sake; to give a semblance of order to a strange continent, so you can settle it yourself on your own terms, without feeling too lost – but simultaneously safe in the knowledge that we all are.”