UPS Was Founded By Two Teenagers With One Bicycle and $100 Borrowed from a Friend

Daven Hiskey 32
cardboard-boxesToday I found out UPS was started by two teenagers with one bicycle and $100 borrowed from a friend.

The date was August 28, 1907 and the two kids were 18 year old Claude Ryan and 19 year old Jim Casey.  The two had one bike between them and $100 (about $2400 today) borrowed from a friend to found the “American Messenger Company” in Seattle, Washington.  The company was initially run in a hotel basement at Second Avenue and Main Street in Seattle.

At that time, most people didn’t own phones, so sending telegrams was a frequent thing.  These had to be hand delivered.  In the beginning, the company primarily delivered these telegrams, but eventually expanded into transporting pretty much anything that could be transported on a bicycle or on foot.  Casey and Ryan manned the phone while Casey’s brother George and a handful of other teenagers went out making deliveries.

Fast-forward a few years and Casey and Ryan had merged their company with rival Merchant’s Parcel Delivery taking the latter’s name.  In the process, they acquired a few motorcycles and delivery cars with their first car being a Ford Model T.   At this time, more and more people had telephones so Casey and Ryan switched to working with retail stores to deliver customers purchases to their homes.

By the time Casey retired from UPS in 1962, the company had grown to operating in 31 U.S. states with annual revenue around $550 million and about 22,000 workers.

Fast forward to 2013 and Casey and Ryan’s company that started so humbly is now worth approximately $80 billion with annual revenue at over $50 billion; employing just under half a million workers in 200 countries; delivering over 3.8 billion packages and documents a year.  Amazing what $100, some elbow grease, and a bit of ingenuity can do.

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Bonus Facts:

  • Returning to their roots, in 2008, UPS began hiring bike delivery workers in Vancouver, Washington and various cities in Oregon.
  • 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.
  • When UPS expanded into West Germany, they had to change the brown uniform to green, due to the “brown shirts” worn by the Nazi SA.
  • 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.
  • UPS uses its own font, UPS Sans, which is a slightly altered FF Dax.
  • The brown color UPS uses is named Pullman Brown.
  • James Casey originally wanted the trucks to be yellow, instead of brown.  He was eventually convinced to make them brown by Charlie Soderstrom.  Soderstrom pointed out that yellow trucks would be impossible to keep clean.  Railroad cars are often brown for this same reason.
  • In 1966, Jim Casey created the Casey Family Programs to help children who are unable to live with their birth parents.  Casey felt his family life was critical to his being able to become successful.  As such, the goal of the organization is to attempt to provide the same type of stability and support base to these children.
  • In 1919, Merchant’s Parcel Delivery changed its name to the United Postal Service.  At this same time, the company began expanding to other cities besides just Seattle.  The name was chosen with “United” signifying that each of the offices in various cities were all part of a greater whole;  “Parcel” identified the nature of the business; and  “Service” indicating what was offered.

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32 Comments »

  1. Mike June 30, 2010 at 8:01 am - Reply

    In the last Bonus Factoid, in the first line, shouldn’t it say “United Parcel Service” and not “United Postal Service”? Later in the paragraph you refer to parcels. Otherwise, great article!

  2. Jessica June 30, 2010 at 2:07 pm - Reply

    Some of the largest companies today were started with little to nothing. Take Papa Johns for instance. He sold is car and started up in his dads bar. Not much to work with, but now Papa Johns is a huge franchised company.

    Mainly just takes determination and a idea.

    • Yer Pal October 25, 2013 at 6:08 am - Reply

      …And a popular bar to sell your wares. Thanks Dad!

  3. James July 1, 2010 at 12:13 am - Reply

    “Fast-forward a few years and Casey and Ryan had merged their company with rival Merchant’s Parcel Delivery taking the latter’s name.”

    Surely this means that UPS was started by whoever the rival company were?

  4. Doug July 1, 2010 at 4:17 pm - Reply

    Correction: “Amazing what $100, some elbow grease, a bit of ingenuity and MINIMAL GOVERNMENT INTRUSION can do.” Give us back the limited government we had back then, and our recession would quickly be fixed. Govt costs us each 40% of our paycheck on average. Restore us back to the 10% of GDP expense of pre-1930 govt and we’d each have 30% more of our paycheck free to buy what we want and take risks on business endeavors.

  5. jp July 4, 2010 at 3:04 pm - Reply

    More likely they chose UPS because it resembles USPS, and many who wanted USPS would contact them instead. Luckily for them, the USPS runs by the gov and they did not care much about trademarks, and if later it crossed their minds, it may have been just a little too late.

  6. cak July 4, 2010 at 4:04 pm - Reply

    This overlooks the fact that starting with $100 had nothing to do with UPS’s success. It was more like the many years of business acumen the two creators had, into expanding the business, and merging with others.

    Also, they have their own brown color which you mention, but you don’t mention they are complete dicks seeking lawyers onto those that use their own special color. What scum they have become.

  7. Thomas July 4, 2010 at 5:13 pm - Reply

    @James
    Probably not, I’d imagine they took the name of rival company because their old name was American Messenger Company and they had evolved past simply delivering messages; either that or they thought the new name was more marketable.

  8. John December 14, 2010 at 7:10 pm - Reply

    @jp From 1792 to 1971 it was called the Post Office Department and from 1971 til now it has been named USPS. It isn’t possible that UPS patterned their name after something that didn’t exist. Using your logic the USPS could have taken its name from UPS. Think UPS will sue?

  9. paul January 3, 2011 at 2:49 pm - Reply

    I’ll tell you what’s really amazing. That they’re still in business what with having union thugs running the day-to-day operations for them.

  10. Andreas January 16, 2011 at 5:31 am - Reply

    UPS germany never had green uniforms. They were brown from the beginning.

    • Daven Hiskey
      Daven January 16, 2011 at 2:46 pm - Reply

      @Andreas: UPS themselves disagrees with you.

  11. Andreas January 22, 2011 at 3:12 pm - Reply

    Unless a link shows up I really much doubt it.
    I can’t find any images with green uniforms, I can’t find any mention except for lists like the above (surely wikipedia would know about it, but instead the information was purged in August 2010 when apparently nobody was able to back it up).

    The given sources don’t include that information (they do not include any information given in the article either).

    UPS had some problems with german work habits and work councils, but not with uniform colors.

  12. Matt February 27, 2011 at 3:04 pm - Reply

    Yeah…..compare what $100.00 was really worth back then, and what it’s worth now…..I could start any f***ing business I wanted.

  13. Denyse Loze April 4, 2011 at 9:21 pm - Reply

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  14. Tony April 26, 2011 at 12:31 pm - Reply

    @Matt, online references suggest that based on the CPI, the purchasing power of $100 in 1907 would be roughly equivalent to $2,350 now. Using wage parity measures, $100 represents the equivalent of $10,000 to $15,000 in current dollars.

    Practically speaking, many startups burn through hundreds of thousands or even millions of dollars and still fail. No amount of capital is going to make a bad idea or a poorly managed business into a success.

  15. Giorgio May 1, 2011 at 3:41 am - Reply

    Since I learned Marketing, I don’t believe in most of the stories.
    Marketing departments know that people like entertaining stories, not business plans and projects, so they can make up a story in such a way that still manages to be true.
    Funny thing is, is valid, I would use that strategy in any project that applies.

  16. Jonathan Wong March 1, 2014 at 7:28 pm - Reply

    So… they were the first bike messenger hipsters?

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