While running a growing business as his day job, Ed Kushins began HomeExchange.com in the early ‘90s as a way to combine his love for travel and his enthusiasm for the home exchange concept. Now retired from his main business, Ed has made HomeExchange.com into the wildly successful business that has been featured the hit movie “The Holiday”.
In the second of a three-part interview, Ed Kushins describes the steps he took to create Home Exchange, and how the tiny offline company morphed into a popular website featured in a Sony movie.
“They sent me a copy of the script and I could see this was like a dream come true.”
Read the interview to find out how Ed answered these questions in his life:
Read the full interview:
Avocationist:It sounds like when you began HomeExchange.com, you really didn’t want to leave the business that you were running. Did you plan on it being just a side project?
“With Home Exchange, I was putting my hand on the next rung.”
Ed:I was having fun with my business and I didn’t have my exit strategy completely set and I was a little too young to be in a financial situation where I could retire. My kids had not gone to college yet so I was looking at a bunch of expenses. With Home Exchange, I was putting my hand on the next rung and I was planning for that. I was going to build it up slowly and there was nobody else in the field so I didn’t feel an urgent need to do it quickly.
“I happened to find a few other people like me in England and France and Italy.”
I found that the business was a little tougher than I thought it was going to be, especially in finding listings outside of my local area or the U.S. A lot of people in the U.S. wanted to go to England, and how was I going to get listings in England? That was a challenge. So I happened to find a few other people like me in England and France and Italy. Those people were in the same boat that I was and I got everyone together and formed an association where we pooled our listings. We each had our own listings, but we put them into a common database so that we got the revenue from the listings that we individually generated. That allowed us to have a presence internationally that would have been very difficult to build otherwise.
“Then the Internet came with a bang.”
My first exchange was 1992 and I started the company in late 1992, and actually started building it in 1993. I started that association and that worked really well in the directory form and then the Internet came with a bang. I saw that as the perfect medium for Home Exchange. We had no product to speak of, everything was done online, and e-mail made communication so much easier than sending letters or faxes, so I wanted to move the association full steam ahead into the Internet. Unfortunately, the group wasn’t quite that forward thinking -- they liked to keep things simple and didn’t want to expand the business the way that I did. So we parted ways amicably over how we were going to proceed with the Internet.
“The Internet really allowed explosive growth.”
The Internet really allowed explosive growth. With search engines people could find out about Home Exchange and you could put in features that were not available in a printed directory with unlimited photos and unlimited text. Before that, a Home Exchange listing looked like a multiple listing on the real estate book where you would have a bunch of little abbreviations and one photo and three lines of description -- that was it. Now with the Internet, you could have unlimited text and search capabilities and 50 photos and all kinds of things. I think that we were the leaders on the Internet.
Avocationist:To go back just a little bit, when you said that you found these other folks in other countries; how did you find them?
“It wasn’t really a business; it was more of a hobby.”
Ed:A couple of them found me, I had heard about a few of them, and some people told me about them, so we maybe we each had 100 listings or something. None of us really had a “business.” With 100 listings the total revenue was around $5,000 a year. It wasn’t really a business; it was more of a hobby. It was really a perfect situation to form an association of shared listings, because we all had the same problem; how do we get listings outside our geographic area?
Avocationist:You had a full-time job while you were doing this. How did you work it into the rest of your life when you were starting this up?
Ed:Hey, there are 24 hours in the day.
Avocationist:Was it a big time investment initially?
“At the very beginning, I spent a lot of time at it.”
Ed:Yes. If you are going to do something as a hobby, you can spend an hour at it, or some people, if their hobby is video games, could spend 15 hours at it. It depends on the individual and how strong their interest is and how much they like doing it and how organized they are. Personally, at the very beginning, I spent a lot of time at it. I probably spent about eight hours a day at my regular job and eight hours a day at this. This was something that really needed to be done -- the organization, writing the brochures, getting things lined up for the printer, then eventually doing the printing and mailing.
“My objective was a little bit different in that I wasn’t looking for it to support me at that point.”
In order to even get the little company set up, it was a very, very time-consuming effort and it definitely was not what I would say adequately compensated for the time I was putting in. But for me, my objective was a little bit different in that I wasn’t looking for it to support me at that point. Once I decided to start the business, I was looking at it not as a full-time income to support my whole lifestyle, but like I said, as a vehicle to travel and hopefully contribute a little bit of income.
Avocationist:So you didn’t kill it with these really high expectations early on?
”I thought it had the potential, that if there were some breakthroughs, we could make a lot of money.”
Ed:Exactly. And I thought it had the potential, that if there were some breakthroughs, we could make a lot of money. Looking back on it now with the cost structure, everything was costly. If somebody would send an inquiry, you would have to send them a brochure and that cost money. Then they would send an application in and you would have to transcribe it and then you would have to print the directory and mail the directory and you never knew how many directories to print. Everything cost a lot of money but the Internet changed all of that. Every single cost structure went down to almost zero. There was no cost of posting of the directory. There was no cost for distribution. Instead of transcribing the application, people put on their own application online. Advertising went down because of search engine capability. Everything about the Internet was really perfect for this business.
“We saw the value of combining the business and our listings so we combined our companies into a new company that we called Homeexchange.com”
The business, with the Internet, started growing. Those people that I had contacted earlier were quite a bit bigger than I was and even quite a bit bigger than we were when we had the association because they had been established for some time with a directory base. They got into the Internet, but they didn’t really take full advantage of it because they were very locked into their directory users.
So I started narrowing the gap. Then I had a strategic merger that narrowed the gap a little further with another guy who started the company “Homeexchange.com,” 100% on the Internet. He did a pretty good job of a website design, even better than what I had. We saw the value of combining the business and our listings so we combined our companies into a new company that we called Homeexchange.com and now we had double the listings. I ended up buying him out of the business a couple of years ago.
“We got a lucky break when the movie ‘The Holiday’ came out.”
That changed everything because the company then I could see really had business potential, as apposed to just being my avocation and giving me the ability to use it to travel. Now I could see that there was a business model there with the Internet that allowed some profit. I ended up taking in a couple of partners who had been working for me that I consider very, very strong members of a team that we have now. We really took advantage of some marketing opportunities. We got a lucky break when the movie “The Holiday” came out. I got a call from Sony after the script had been written. I had no idea that the movie was coming out, but it turns out that the writer of the script, Nancy Meyers, had been on our website long before the script was written, and thought, “Hey, this would be a cool way for some characters to meet as a plot device.” So when she was done, I got a call from Sony asking if they could use our website in the movie.
“I said, ‘I would like to know a little bit more about the movie because I am not sure I want to be associated with a movie if it is a slasher movie where the whole family gets murdered or something bad happens.’”
Ed:Now, not so quick, because I didn’t know anything about the movie and I said, “I would like to know a little bit more about the movie because I am not sure I want to be associated with a movie if it is a slasher movie where the whole family gets murdered or something bad happens.” They said, “Oh no, no, no. This is Nancy Meyers of ‘What Women Want’ and a bunch of other movies. We can’t tell you the cast right now, but it is going to be a really cool cast.”
“They sent me a copy of the script and I could see this was like a dream come true.”
They sent me a copy of the script and I could see this was like a dream come true. We established a very close relationship with Sony from the very beginning and we actually provided them a bunch of resources for the movie, and so before, during and after the movie, we had a very good relationship with them in terms of the marketing of the movie. We were able to put some marketing materials into the press kit they sent out and we hired a PR firm, knowing that not only was the movie going to be helpful, but that we could take advantage of the movie and get a lot of press after that. That is exactly what happened. The movie increased the awareness of Home Exchange, but we then leveraged that and we got The Today Show and Reuters and Washington Post and the New York Times and the L.A. Times and worldwide press from the movie because of the PR that we initiated from the movie.
Avocationist:Yes, because there was interest in, “Is this real?”
“Cameron Diaz did a press conference and she said, ‘Oh yeah, I am going to do a real home exchange with Kate Winslet’”
Ed:Yes. And Cameron Diaz did a press conference and she said, “Oh yeah, I am going to do a real home exchange with Kate Winslet” and we took that and we made a whole press release out of that. Between the movie and the press we got after the movie, it really, exponentially increased our growth.
“Now people are really aware of Home Exchange and we are pushing different things.”
We had our 20,000th member a few of months ago, and our 10,000th member was 18 months before that. We doubled in 18 months and now the movie is actually old news, but we are getting more press now than we got when the movie came out. Now people are really aware of Home Exchange and we are pushing different things. Everything before was related to the movie and now we have so many different affinity things going on -- right now we have a whole thing about “Vacation like there is no recession.” And “Don’t worry about the Euro with the Home Exchange. It doesn’t cost any more to go to Europe than it costs to stay at home, except for the airfare.” People and the press are picking up on because it is a buzz story. We are feeding them a lot of really interesting, good stories and we are getting more press now than we ever got and it is showing up in the amount of listings that we are getting. We are getting literally dozens of new listings every day. Sometimes we get 100 new listings in a day.
Avocationist: We did our first home exchange this summer. I took my family over to Paris for a month and the other family is lived in our house in Charlotte. I had a neat thing happen. I had a business trip to France in September and I worked it so I could go to Paris. I sent a message to some people saying that I would be there, and a couple of people responded. So I actually got to meet our family in person and see their place.
I travel a lot for work and I had not done House Exchange yet because I have not had time, but just the experience of meeting those two people in Paris and their hometown for coffee to talk for a little bit about how they live there is a lot different than if you are just a business person on a trip.
“I love to hear stories like that.”
Ed: That is cool. That actually makes everybody feel a little more comfortable that you got to meet. We just had an article in one of the Charlotte papers not too long ago, and we actually had our 20,000th member and I think they came from Raleigh.
Avocationist:It was fun when I heard about it and I wasn’t really sure if people would be willing to come to Charlotte, but you try it and it works.
Ed: I love to hear stories like that.