The Idea That Turned an Empty Room Into Millions of Dollars

In 2007, two friends had an idea that would turn into a multimillion dollar business.

It's a great story illustrating the fact that it's one thing to have a great idea but another to act on that idea and capitalize on it.

Unable to pay their rent, Brian Chesky and Joe Gebbia, decided to rent out a room of their apartment as an alternative for conference goers for a large design conference heading to town.

It was a clever idea because it turns out they discovered that many people were looking for alternate accommodation, rather than stay in cramped hotel rooms, or because they were traveling on a budget, or would rather stay with a local and gain insights into the area.

In 2008 they took they idea and started a business called Airbnb.

They now boast over 1 million nights booked, a 65% growth curve, and a revenue stream in the millions. Last year they received $112 million in B Series financing to grow the business further.

The idea is beautifully simple as is the business model. Airbnb is an online community marketplace that connects people who have space to spare with those who are looking for a place to stay. Airbnb provides the platform and makes money on each booking in the form of a buyer mark-up as well as a commission from the provider.

And it gets better than that. Through their model they have also helped other people from over the world make money as well by renting rooms in their own homes. In fact on their site they mention that in 2009 the first home was saved from foreclosure by renting through Airbnb. How cool is that.

They now have over 100,000 listings, in more than 16000 cities and 186 countries. Accommodation types include castles, caravans, apartments and houses.

It really is a great example of a commercially viable idea - and for a number of reasons.

Firstly, it solves two problems at the same time by providing alternate accommodation for travelers (whether to save money, or gain a unique experience or because nothing else is available) and by also providing additional income for people.

In addition to that the model is global, and by piggy backing onto major events such as concerts and conventions, it's marketable.

It is also a great example of persistence in getting an idea up.

It's one thing have a brilliant idea but another to give it life. Like many start-ups it was a bumpy road in the beginning. But rather than giving up, the guys got smart, attended a start-up boot camp and ultimately got the funding they required. They were also smart enough to bring other people on board who had the necessary skills that they themselves didn't have. Needing a tech expert, Nathan Blecharczyk, was brought on board as the third founding partner.

It's an inspiring story because both Brian and Joe not only saw the potential of their idea but also had the courage to act on it. And there's a great lesson in that.

Nigel Collin is founder and CEO of 'Thinkativity'. A company that helps organizations generate quality ideas that are profitable. He is a speaker and author of two books, his latest being 'Herding Monkeys - how to lead on the creative talents of your people and turn their ideas into commercial success

For more information visit http://www.thinkativity.com.au