Have you ever heard of Fred Smith?
When Smith attended Yale in the 1960s, he wrote a term paper, which invented an industry and dreamed of changing the impossible into the possible. His professor couldn’t visualize the revolutionary implications of Smith’s ideas and gave Smith’s term paper an average grade. The professor’s reasoning: the business was not feasible.
Smith’s impossible dream became a reality on April 17, 1973, when Federal Express began operations with 389 employees, 14 planes, and 186 packages in Memphis, Tennessee. The packages were flown to 25 cities and delivered the following day.
Today, we think little about dropping a package off at a Federal Express site or a competitive carrier and then expecting the package to be delivered the next day or soon after. Yet, the whole air/land express industry was just a dream fifty years ago and pooh-poohed by experts at the time.
Let’s say that I sat next to Fred Smith in his business class at Yale and also had to write a term paper on a proposed business, just like Smith did. For my business model, being the believer that I am today, I would have written:
1. My publishing company will have no partners, except for family.
2. It will never ask for money.
3. With the exception of book stores and eBook publishers, my publishing company will not set prices for its books.
4. My publishing company will operate under the U.S. and state business laws as a business and not as a 501(c)(3) nonprofit, tax exempt organization.
5. The millions of dollars generated by my publishing company will help feed and care for the poor and needy of the world.
What do you think the professor would have said to me after reading my paper?
The professor probably would have called me into his office, closed the door, and stared at me for a few minutes in total quiet. Maybe he would have shaken his head and blown out a deep breath before saying, “Son, you remind me of the two guys who came up with the brilliant idea of buying watermelons in San Diego for $1 each and then hauling them to LA and selling them for 50¢ each. It wasn’t long before the two men learned they were losing lots of money. One of the guys came up with an idea and said, ‘We need a bigger truck so we can be like K-Mart and make up our losses with volume sales.'”
I can guess what my grade would have been on the paper. Can you?
(Continued in Part 7)