

UPS was founded by 2 teenagers, 1 Bicycle, and $100 borrowed from a friend - grinich
http://www.todayifoundout.com/index.php/2010/06/ups-was-founded-by-two-teenagers-with-one-bicycle-and-100-borrowed-from-a-friend/

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jakarta
FedEx also has an interesting story:

"In 1962, Smith entered Yale University. While attending Yale, he wrote a
paper for an economics class, outlining overnight delivery service in a
computer information age. Folklore suggests that he received a C for this
paper, although in a later interview he claims that he told a reporter, "I
don't know what grade, probably made my usual C", while other tales suggest
that his professor told him that, in order for him to get a C, the idea had to
be feasible. The paper became the idea of FedEx (for years, the sample package
displayed in the company's print advertisements featured a return address at
Yale)."

Smith used his time in the military to get insights in how to refine his idea:

"As a Marine, Smith had the opportunity to observe the military's logistics
system first hand. He served two tours of duty in Vietnam, flying with pilots
on over 200 combat missions. He was honorably discharged in 1969 with the rank
of Captain, having received the Silver Star, the Bronze Star, and two Purple
Hearts. While in the military, Smith carefully observed the procurement and
delivery procedures, fine-tuning his dream for an overnight delivery service."

link: <http://en.wikipedia.org/wiki/Frederick_W._Smith>

I thought it was pretty interesting. Found it because I've been spending a lot
of time seeking companies that have the following attributes: (1) extremely
high barriers-to-entry, (2) good growth potential for the next 15+ years with
little obsolescence risk, (3) a high quality management team, and (4) a good
balance sheet. FedEx was one of the companies which met all the above
categories.

~~~
grinich
What other companies did you find fit those attributes?

~~~
jakarta
Not a whole lot.

Sysco (SYY), the food distributor. Fiserv (FISV), they do a lot of payment
processing.

But, those two benefit from having business models which are more resilient to
economic downturns than FedEx.

------
wallflower
It's not completely fair to contrast with FedEx, which had one of the largest
startup costs of the time because they were different types of delivery
services but:

> Smith supplemented a $4 million inheritance from his father with $91 million
> in venture capital to get his idea off the ground.

[http://www.fundinguniverse.com/company-histories/FedEx-
Corpo...](http://www.fundinguniverse.com/company-histories/FedEx-Corporation-
Company-History.html)

------
silvia77
There was just a HN story asking about non-developer success stories (sorry
don't have the link, writing this using the HN iPhone app) this is a perfect
story for that discussion.

A large % of companies were started by non-coders, and this is a good example
of one. Not to say anyone can solve hard technical problems but just because
you can't code doesn't mean you can't start something great.

There is nothing wrong with starting a business in a traditional industry, the
most important thing is doing something you love and want to do.

------
skurland78704
"UPS developed software that routes trucks such that they minimize left turns
in their deliveries. By doing so, they reduced their annual fuel consumption
by nearly 51,000 gallons in Washington DC alone. The reduction in fuel comes
from drivers not having to sit idling at red lights waiting to make left hand
turns."

I wonder if mapquest, google maps et al do that.

~~~
chronomex
Probably not. UPS trips involve a lot of points the truck has to pass, so they
do a lot of turning. Most trips I've planned with Google Maps and friends seem
to be "get onto the freeway, go near your destination, get off the freeway".

------
jacquesm
$100 back then would be a fair amount of money today. Nice story though, the
big thing to notice is that opportunity and timing + determination made it
work, age, capital and so on were secondary.

~~~
abstractbill
_$100 back then would be a fair amount of money today._

It would be about $2400 today
(<http://www.wolframalpha.com/input/?i=100+1907+dollars>).

------
stretchwithme
Interesting story. I actually have worked for a small package delivery service
between high school and college. That was a fun job.

My UPS connection is an old friend whose first job was data entry at UPS. And
I see on Facebook that she still works there 29 years later. God I'm old. :-)

------
callmeed
I did IT at a UPS call center. I had to take a test after orientation that
included knowing company history.

Another interesting tidbit: even in a call center/office we had to adhere to
the same "grooming standards" as drivers (hair, facial hair, etc).

------
yewweitan
It's a wonderful thing what persistence and vision can do. Still, that was
back in the day when your could execute an idea based on vision and business
prowess alone.

Not saying that it's impossible, but the rise in status of developers over the
last few years is a result of the increasing technical difficulty of managing
a business and growing it to size.

Make note of history, learn from the present, execute on the future.

------
honopu
Here's a question I hope someone else can answer. I get the whole idea of the
underdog seeing a niche and taking it over.

What I don't understand is the progression from 2 kids, a bike and $100 into a
50 billion dollar multinational corporation.

How does that work?

Thank you in advance.

~~~
jakarta
You do the same thing, over and over again.

If you look at some of the most successful businessmen in history, you'll see
that a lot of what they did was find some kind of unexploited area of the
market and take advantage of it.

Usually it starts in their home town, but it can often by replicated and
expanded outside of that area. And when they do that they generally get to
take advantage of the economies of scale. Along the way, if they iterate and
refine on the process -- they get stronger and stronger till they become the
$50B MNC you're talking about.

Looking at the history of UPS, this seems pretty apparent. They started doing
deliveries in Seattle > California > West Coast > New York > East Coast >
Midwest > Canada > Europe.

Walmart and McDonalds kind of did the same thing. In every instance there is a
certain level of innovation that keeps them ahead of the pack.

~~~
retube
yeah i think that's basically it. Find a business model that works and repeat
it over and over in different geographies or markets. Or even: do it once,
sell, do exactly the same again (e.g Hutchinson Whampoa with Orange (sold to
France Telecom) and now 3).

------
Groxx
1907 - 1962: Jim Casey does UPS-work.

Moral of the story: make sure you are doing what you love if you're trying to
start a business, _right now_ , because you'll do it _for frickin' ever_.

------
mkramlich
lesson: start a biz now. then 60 years later retire very old and rich!
success! i'm only half-kidding.

~~~
shrikant
With the piffling matter of having a sustainable idea and a business model,
_and_ being able to execute, in between all of that.

------
sliverstorm
> In the early days of UPS, the United States Postal Service was their biggest
> client. UPS handled delivering all USPS special delivery mail in Seattle.

Bet USPS regrets that now!

Just kidding :)

