According to CNBC, Steve Sonnenberg’s journey from bankruptcy to billionaire status is one of those classic entrepreneur comeback stories that sounds almost too good to be true. Back in 2011, his first company WholesaleMatch got tangled in a Federal Trade Commission lawsuit against one of its clients, leading to frozen assets and ultimately bankruptcy protection. With four kids under age 5 and millions in debt, he walked away from everything except an idea for an employee rewards platform called Awardco. He put $5,000 on a credit card to buy the domain, worked a day job at Qualtrics while building the business at night, and eventually landed an Amazon partnership that changed everything. Today, Awardco serves six million users at companies like AT&T and Hertz, and just hit a $1 billion valuation after a $165 million funding round in May.
The legal nightmare that started it all
Here’s the thing that makes this story particularly brutal: Sonnenberg wasn’t even the primary target of that FTC lawsuit. The original case was against one of his clients, but he got dragged in as a co-defendant. Basically, his entire business got caught in the crossfire. Imagine building something for eight years, employing 200 people, and then having it all vanish because of a client’s alleged shady practices. The whole situation resulted in a $130 million group settlement years later, but by then the damage was done.
The gutsy comeback move
So what do you do when you’ve lost everything and have four young kids to support? Apparently, you start another business. Sonnenberg calls entrepreneurship “just who I am,” which sounds noble but honestly seems a bit crazy given the circumstances. He was working his day job from 7am to 5pm, doing family stuff until 8pm, then building Awardco until midnight. That’s the kind of grind that either breaks you or makes you, and in this case it clearly paid off. But let’s be real – for every success story like this, there are probably dozens of entrepreneurs who tried similar comebacks and failed spectacularly.
The Amazon hustle
The most fascinating part of this story might be how he landed Amazon as a partner. He basically reverse-engineered the whole thing – used Amazon’s open API to integrate their products into his platform, started signing up companies, and then had his wife manually ordering reward items from Amazon herself. That’s some serious dedication. He eventually called some random person on LinkedIn who told him no, but kept building until Amazon couldn’t ignore the business he was driving their way. It’s a classic case of asking for forgiveness rather than permission, and it worked.
What makes this different
Look, we’ve all heard the “maxed out credit card” startup story before. But there’s something different about someone who’s already been through the entrepreneurial wringer once – failed spectacularly, faced legal battles, had assets frozen – and still has the guts to try again. Most people would have taken that corporate job at Qualtrics and called it a day. The employee recognition space is crowded, but Awardco’s Amazon integration and focus on enterprise clients clearly found a niche. Still, hitting a billion-dollar valuation in today’s market? That’s the kind of number that makes you wonder if we’re in another bubble. Only time will tell if this comeback story has staying power.
