---

Staff post about: Fred Smith Become an Author

Tweet

---

---

“By the early '70s when I'd gotten out of the service it was very clear that this new society was coming in earnest,” recalls Smith. “And so, at that point I said, ‘What the hell, let's try to put it together.’” After leaving the U.S. Marine Corps, Smith purchased a controlling interest in Ark Aviation Sales, a company that focused on aircraft maintenance. This was the first step towards realizing his goal of what would soon become Federal Express.

Smith reoriented Ark Aviation Sales, turning its focus towards trading used jets. On June 18, 1971, Smith officially created Federal Express using $4 million in inheritance and $91 million in venture capital. “The solution was, in my mind, to have an integrated air and ground system, which had never been done,” says Smith. “And to operate not on a linear basis, where you try to take things from one point to another, but operate in a systemic manner.”

Smith compared his business idea to that of a bank clearing house, whereby one bank clearing house would be located in the middle of all the banks and representatives would all be sent to the central location to exchange materials. “That had been done in transportation before: the Indian post office, the French post office,” says Smith. “American Airlines had tried a system like that shortly after World War II. But the demand side and supply side had really not met at an appropriate level of maturation.”

Federal Express was Smith’s response to what he saw as a pressing – and growing – need. Smith’s hunch about the changing trends in society was correct. Just two years after the company was first formed, it was already offering service to over 25 cities and was experiencing tremendous growth.
“And that's how FedEx came to be,” says Smith. “And then from that point forward, the requirements for this type of system were so profound and so big, really for the next 25 years to this date we've simply been running just to keep up with the requirements. And that's what led to the hundreds of planes and the thousands of trucks.”

Today, Federal Express employs some 275,000 workers and earns over $32 billion in revenue. It was the first overnight express delivery company in the world, and continues to be the largest in the U.S. Indeed, few businesses today would be where they are now were it not for the idea that Smith first penned in his Yale University essay and worked tirelessly to put into practice.

Smith remains active in the running of the company as its Chairman, President and CEO, but is modest about the success he has achieved thus far. “I wish it was something that I could say I was so smart,” he says. “It was just like Pogo the Possum said, ‘If you want to be a great leader, find a big parade and run in front of it.’ And that's what we've been doing for the last quarter century.”

Related Articles

  Father of the Overnight Delivery Business: How Smith Revolutionized an Industry
  Lesson #2: Never Stop Putting Up A Fight
  The Message Man From Mississippi: Fred Smith is Born
  Lesson #1: Be Willing To Roll the Dice
  Lesson #4: Put Your Money Where Your Mouth Is
  Personal Discipline
  Lesson #5: Be Flexible Enough To Change With The Times
  Top 5 Ways to Get That Big Meeting
  Love Me, Love My Spam
  How to avoid the 7 deadly sins of business storytelling
  The Entrepreneurial Spirit
  Getting New Customers - Referals
  Is the student ready?
  How Not To Sell Your Product or Service
  What's the Point of Getting a Federal Trademark?
  Lesson #3: Learn To Put People First
  "The Ultimate Triumph of Theory Y"
  When Offers for Career Help Don’t Pan Out
  The ABC Method of Memory Jogging
  Express Love to Dad with a Father's Day DVD Slideshow

Related Forum Posts

Re: Social Media Effectively?
Re: Free electricity generator
Require Info on CAD Fed/Prov Grants for Restaurant Start-up
Outlook Express - anybody use it?
Re: How do I find a direct mail list of potential customers

Share this article. Fund someone's dream.

Share this post and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet