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The Mick
USA Fan
Member since Oct 2010
34425 posts

Owner of FedEx gambled company's last 5k to keep doors open (1971)...
Old article but I just heard about this myself for the first time. Germans I'm sure but I searched and didn't see anything, hence the thread. Some of you probably aren't familiar with this story so.....


quote:

In 1971, Fred Smith founded the company with $4 million of inheritance and $80 million in loans and equity investments. FedEx started out with eight planes, covering 35 cities, and it had plans to add more each month.

But in the first two years, primarily due to rising fuel costs, the company found itself millions of dollars in debt and on the brink of bankruptcy. Even worse, Smith's vital pitch for funding to the General Dynamics board was rejected.

quote:

When FedEx's funds dwindled to just $5,000, Smith realized he didn't have enough to fuel the planes. The company had already gone to many extremes, from pilots using their personal credit cards to fuel planes to uncashed paychecks.

So what's a desperate founder to do? Smith impulsively flew to Las Vegas and played blackjack with the last of the company money.

Amazingly, when he came back the next week, he had turned the remaining $5,000 into $27,000 — just enough for the company to stay in operation for another week.

quote:

Roger Frock, a former senior vice president of operations at FedEx, describes the scene when he found out what Smith did. "I said, 'You mean you took our last $5,000 — how could you do that? [Smith] shrugged his shoulders and said, 'What difference does it make? Without the funds for the fuel companies, we couldn't have flown anyway.'"


Fred Smith is now worth an estimated $4.5 BILLION


LINK


Centinel
Alabama Fan
South Carolina
Member since Sep 2016
7265 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
He who dares, wins.


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330
CypressTrout10
Atlanta Braves Fan
Member since Jun 2016
1301 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
Im heading to Harrahs with 5k. Wish me luck.


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640
lsuhunt555
New York Yankees Fan
Teakwood Village Breh
Member since Nov 2008
30379 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
quote:

Fred Smith is now worth an estimated $4.5 BILLION


And now he can play blackjack forever.


Bmath
LSU Fan
LA
Member since Aug 2010
15479 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
That takes some cojones.
This post was edited on 2/17 at 1:29 pm


Honest Tune
LSU Fan
Tchefuncte River
Member since Dec 2011
5136 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
Brass balls


The Mick
USA Fan
Member since Oct 2010
34425 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
quote:

That takes some cajones.
For sure, but like he said - the 5k was almost meaningless and he had nothing to lose.


Wally Sparks
Georgia Tech Fan
Atlanta
Member since Feb 2013
16653 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...


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darryljames30
New Orleans Pelicans Fan
New Orleans
Member since Feb 2006
20963 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
Damn, what a story.


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Breesus
New Orleans Saints Fan
House of the Rising Sun
Member since Jan 2010
56098 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
He also failed business school with that idea


TheAlmightySmash
LSU Fan
New Orleans
Member since Jun 2014
3948 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
quote:

, 'What difference does it make? Without the funds for the fuel companies, we couldn't have flown anyway.'


Truely inspirational. Putting the house on Red this weekend.


AlonsoWDC
Memphis Fan
Memphis, where it ain't Ten-a-Key
Member since Aug 2014
3260 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
Making Memphis Great Again


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31
kywildcatfanone
Kentucky Fan
Wildcat Country!
Member since Oct 2012
44356 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
quote:

For sure, but like he said - the 5k was almost meaningless and he had nothing to lose.




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12
piratedude
LSU Fan
baton rouge
Member since Oct 2009
1524 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
i heard that story from a econ professor at nlu back in the day. his take on it was that Las Vegas had a very strong interest in maintaining a method of shipping large quantities of currency that would not subject them to governmental control of the packages or the content. his view was that it was less a gamble than it was an "investment" by Las Vegas.


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41
ThePerkins927
LSU Fan
CenLA
Member since Feb 2017
21 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
He doesn't even have balls, he has whatever balls evolved into and he has become an evolutionary species built from pure testosterone to gamble with 5k as his company was going under.


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80
Cosmo
Houston Astros Fan
glassman's guest house
Member since Oct 2003
82706 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
You think Memphis is a shithole now? Imagine Memphis without Fedex. It is the one company keeping it from becoming Jackson MS
This post was edited on 2/17 at 2:00 pm


Honest Tune
LSU Fan
Tchefuncte River
Member since Dec 2011
5136 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
Oddly enough, the Grizzlies have gone on a nice upward trend since moving there from world-class Vancouver.


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31
bayoumuscle21
LSU Fan
Baton Rouge
Member since Jan 2012
1740 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
quote:

He also failed business school with that idea


I have a buddy who has a PhD in business and has no clue how to run one. Admittedly said that I could run a business with my eyes closed better than he could with all of his education. At least he understands, experience >>>>>>>>education.


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29
OweO
LSU Fan
Saints Fan
Member since Sep 2009
56868 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
quote:

And now he can play blackjack forever.



Not if he bets it all on one hand and losses.


Mr. Hangover
New Orleans Saints Fan
I Can't Believe I've Been a
Member since Sep 2003
20461 posts

re: Owner of FedEx gambled company's last 5k to keep doors open (1971)...
I don't believe that is was as black and white as that story painted it to be



ETA- these types of stories seem too fabricated to me, I'm sure some details were exaggerated to make it seem more 'hollywood'
This post was edited on 2/17 at 2:10 pm


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