Fred Smith founded the Federal Express in 1971 and it began operations in 1973.
(The company was based on an idea he wrote about in a term paper in 1965, for which his professor gave him a C grade. We will talk about it in a different thread.)
By 1972 Smith had raised $80 million in loans and equity investments.
FedEx began operations in April 1973 and quickly grew. However, rising fuel costs eventually caught up with the young company, putting FedEx millions of dollars in debt. When the company had only $5,000 left and bankruptcy was in plain sight, Smith pitched General Dynamics for more funding, but the board refused.
With no option left (apparently), Smith then took a weekend trip to Las Vegas. He played blackjack and managed to win $27,000, which he wired back to FedEx
“The $27,000 wasn’t decisive, but it was an omen that things would get better,” Smith said about the gamble. The money provided enough funds to cover the company’s fuel expenses for another week.
“I was very committed to the people that had signed on with me, and if we were going to go down, we were going to go down with a fight. It wasn’t going to be because I checked out and didn’t finish,” he said.
After his blackjack win, Smith was able to raise another $11 million and the company went public two years later.
Now this story is not to be a typical “advice” story where I say, as an entrepreneur you have to do anything needed bla bla. It is just an interesting story of what happened.
It is not necessary to forcefully extract morals from every story. Have a nice day ahead. Go work on your startup/business/scrolling, whatever.
