The overnight-delivery idea began as a Yale term paper. What grade it got is a legend even Fred Smith would not confirm. What he built on this field is not.
A Pirep featured story · KMEM Memphis International, Memphis, TN
In 1965, a Yale undergraduate named Fred Smith turned in a term paper for an economics class. He had been thinking about a problem in the air-freight system: the fastest way to ship a small package across America was in the belly of a passenger plane, which meant routes followed where people wanted to go, not where freight needed to be. Smith proposed a dedicated jet fleet, a central sorting hub, every package routed through one airport overnight and delivered the next morning. He knew the problem firsthand; he had moonlighted through Yale as a charter pilot hauling computer parts. The paper came from a cockpit, not a library.
The legend says the paper got a C, and in some tellings the professor wrote that the idea would need to be feasible to earn better. Smith's own version, offered for fifty years with a shrug: I don't know what grade, probably made my usual C. Whatever the mark was, he kept the idea.
Smith had flown since his teens. After Yale he served two tours as a Marine in Vietnam, earning the Silver Star, the Bronze Star, and two Purple Hearts, and flying more than 200 missions as a forward air controller. Home again, he put in $4 million from his father's estate, raised $91 million in venture capital, and incorporated Federal Express in June 1971.
On April 17, 1973, the company flew its first night out of Memphis International: fourteen Dassault Falcon 20s, 389 employees, 186 packages, 25 cities. Smith picked Memphis because it sat in the middle of the country, its airport almost never closed for weather, and the city's leaders agreed to build him whatever he needed.
The first twenty-six months lost twenty-nine million dollars. At the lowest point Smith took the company's last five thousand dollars to Las Vegas, played blackjack until it was twenty-seven thousand, and wired it home to cover the fuel bill. Drivers sometimes paid for gasoline out of their own pockets. The 1973 oil embargo nearly finished the company before it started.
By 1983, Federal Express had become the first American company to reach a billion dollars in revenue within a decade of its founding, without a single merger or acquisition. For most of the 1990s and 2000s, Memphis was the busiest cargo airport in the world, and it remains among the busiest on Earth, moving millions of tons a year. Fred Smith died in Memphis in June 2025, at eighty, and was buried at Arlington. The hub he imagined in a term paper still turns over every night on this field.