FedEx Had $5,000 Left. Its Founder Flew to Vegas and Bet It All.

In the summer of 1974, Federal Express was hemorrhaging money. The company had launched just a year earlier with an ambitious plan to revolutionize overnight delivery, but the 1973 oil crisis had sent fuel costs soaring. FedEx was burning through cash faster than its planes burned jet fuel.

By July, the situation was dire. The company's bank account held exactly $5,000 — and a $24,000 jet fuel bill was due Monday morning. Without fuel, the planes wouldn't fly. Without planes, there was no FedEx.

The Vegas Gamble

Fred Smith had just been turned down for emergency funding by General Dynamics in Chicago. On the flight home, he made a decision that no business school would ever endorse: he diverted to Las Vegas.

Smith took the company's last $5,000 to the blackjack tables. Over the course of the weekend, he turned it into $32,000 — a $27,000 profit that would just barely cover the fuel bill and keep the operation running for one more week.

"I Knew We Needed Money for Monday"

When senior vice president Roger Frock arrived at work Monday morning and saw the bank balance had mysteriously jumped from $5,000 to $32,000, he confronted Smith. The founder's response was characteristically unfazed: "I knew we needed money for Monday, so I took a plane to Las Vegas and won $27,000."

Frock later recounted the exchange in his book Changing How the World Does Business, noting that while the amount "was not much, it came at a critical time and kept us in business for another week."

The Week That Changed Everything

That single week was all Smith needed. He used the time to close approximately $11 million in new venture capital funding, pulling FedEx back from the edge of oblivion. By 1976, the company had reached $75 million in annual revenue and finally turned a profit.

Smith himself later reflected: "No business school graduate would recommend gambling as a financial strategy, but sometimes it pays to be a little crazy early in your career."

Today, FedEx generates over $90 billion in annual revenue and operates in more than 220 countries. It all might have ended on a Monday morning in 1974, if a blackjack table in Las Vegas hadn't been kind to a desperate 30-year-old with everything on the line.