Katie McManus describes the bankruptcy of Sonder (a hospitality company) after a partnership with Marriott unraveled, arguing the company’s unit economics were flawed and that investors pushed a failing business public to recoup funds. She uses this episode to reassure prospective entrepreneurs who fear being exposed as frauds, contrasting their integrity with the deliberate misrepresentation she attributes to Sonder’s founders and urging listeners to start their businesses.
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Okay, so Saunder Hotels just went bankrupt. They had some partnership with Marriott, and Marriott started saying, like, the numbers are not numbering okay. And so they pulled out and basically left every single person who is staying at a Sonder completely stranded. They were kicked out of the rooms. It was a mess. And here's what I want you to take from this. So Saunder was created to be, you know, a hotel like thing that you could book through Airbnb Marriott, that is a massive, massive hotel group. We all know a Marriott, we are all close to a Marriott, decided they wanted to horn in on the Airbnb market. So they invested. And I saw this great creator. I lost the video. I wish I could share it, but I saw this great creator basically break down that, like, the math was seventh grade math. If they had just looked at this spreadsheet and, you know, done some calculations, they would have seen that the Sonder business model was never designed to be profitable. And that the only reason they went public in the back door way that they did was because the people who had invested originally wanted their money back. And this company was started by two mediocre men who talked a great game. And I bring this up because I have so many clients who are terrified to go out there and get clients, because they're worried that if they go out there and get clients and their clients pay them and they start doing the work and their clients are unhappy, their clients are going to think that they're a fraud. Even even though they are experts in the field that they're in, they have years of experience doing the work that they do. They've just never done it in their own business before. And if you're in that position, if you're worried that if you got clients, they would think that you're a fraud, I want to just remind you that there are actual people out there who are committing fraud right now. Like, there was no way that these two guys didn't do the math and understand that their business model was defunct, but they still made a very convincing argument for why people should invest in it. And here you are worried that someone's going to be unhappy with your service. I want to remind you, you would never do that. You have integrity. You actually want to do work that makes the world a better place, and you would never take advantage of people or systems in that way. So stop being a weenie about it and go and start your goddamn business.
