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Schwebel works from his office in
New York, and his business partner, a friend from U.C. Davis, works from a Los Angeles office. Banana Bungalow has brought about 100 employees on board since its launch in 1990.
One of Banana Bungalow's biggest
successes has been creating one of the largest name reputations among world travelers. Last year, Arthur Frommer's Budget Travel Magazine named Banana Bungalow's Miami property as one of the top ten budget motels in the country. Several other guides have also given the chain consistently good write- ups.
One of the challenges Schwebel has
faced is raising capital as the company expands. Banana Bungalow's largest property in Hawaii, containing about 156 rooms, was a large investment. Renovation and initial operating costs were extensive. So far, the company has expanded through cash flow, but Schwebel is open to capital partners too.
Schwebel's favorite part of being an
entrepreneur is creating a company and product that the public enjoys. When it comes to Schwebel's lifestyle, he initially had a deal with his partner where each would work half the time at the business and half the time traveling. After marrying, however, financial obligations urged Schwebel to work full-time with the company. His wife runs a Public Relations company that specializes in fashion and luxury entertainment, so the couple has an entertaining (literally) lifestyle. They are fortunate enough to attend various media-worthy parties and other events.
When it comes to advice for other
entrepreneurs starting out, Schwebel says, "You must stay completely committed to your dream. You will be knocked down at times, but regardless of what people say, you have to stay focused." |
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A typical room has three bunk beds and
an adjoining bath. Private rooms are also available. |
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Success Stories
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Creating Budget Vacation Spots Proved Profitable For One Man
By Brian O'Rourke
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Believe it or not, San Francisco
native Keith Schwebel was interested in medical school, not business, long before he began his successful chain of youth hostels called Banana Bungalow. Schwebel was half way through his junior year of college at U.C. Davis, when he realized that business, not medicine, was what he wanted to go into. |
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Schwebel was still undecided about
which career path to take upon graduation, so he traveled to Europe for three years. While there, he stayed in hundreds of youth hostels. He enjoyed meeting people from all over the world and the experience influenced him to run his own hostel.
Schwebel formulated a vision of what
he wanted to create based on the best elements of the hostels he stayed at while in Europe. He returned to San Francisco and learned as much as he could about real estate and creating a business plan. Realizing that he had no experience, he took a job managing a youth hostel in Waikiki. There, he turned an average property into a very successful one.
A group of people who owned a car
rental agency saw the transformation at the hostel and asked Schwebel if he had thought about running his own property. Schwebel informed them of his long-term plans and the group was impressed. They helped acquire a property in Maui and leased it back to Schwebel.
Now, Schwebel operates his own
chain of youth hostels all across the U.S. There are properties at South Beach in Miami, Pacific Beach in San Diego, Hollywood, Santa Barbara, and Waikiki. Schwebel is currently looking into other U.S. markets to |
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Schwebel says that the main focus at
Banana Bungalow is social interaction. Each property has an Activities Coordinator, various parties, and a fun, friendly atmosphere for people from all over the world to interact. |
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Pricing varies by city and season, but
Schwebel says that a typical bed ranges from $16 to $22 a night, and private rooms at the Hawaii and Miami properties range from about $45 to $100 per night. |
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open hostels and he would eventually like
to create an international brand, or flag, as they call it in the hotel industry. |