Credit cards have been getting a bad wrap lately. We thought we’d even things out a bit with a list of 5 famous examples of credit cards used incredibly successfully. So before you put your credit card in the freezer for a rainy day, just remember, used as prescribed, and credit cards can do some good! It may not be the most popular thing to say, but it’s hard to argue against success:
1. Did you know that Google founders, Sergey Brin and Larry Page used credit cards to fund Google early on? In mid 1998 Google was getting 10,000 searches a day, so Sergey and Larry maxed out $15,000 worth of credit cards to purchases a terabyte of disk space and drafted a business plan. The rest is history – Google it if you don’t believe me.
2. In 1999, brothers Charles and Kai Huang launched Guitar Hero, eventually turning it into a billion dollar venture selling over 30 million copies. Charles Huang says “in order to get the game out, my brother and I took out second mortgages and took on credit card debt to buy inventory for the launch of Guitar Hero.” Huang also initially sold online only, because when somebody orders with a credit card, you get paid in two days.” This is a prime example of the important role credit cards have played not only for consumers but for retailers as well, despite the incessant complaints over credit cards’ exorbitant fees.
3. In 1993, Kevin Smith funded the $27,000 budget of Clerks by selling his comic books, buying supplies with his more than 10 credit cards and borrowing from family and friends. The movie grossed over $3 million in theatres. 10 credit card at 24 years old might be a little excessive.
4. More than 25 years ago, Continental Airlines started the first frequent flyer credit card program in October 1986 to help it identify, and reward its best customers. Now more than 255 million people belong to a frequent flyer program in North America, of which about 18 million people have a frequent flyer credit card, representing over $337 billion in purchases in the U.S. and $45 billion in Canada. 18 million people can’t be wrong can they?
5. Hundreds of millions of dollars a year have been raised for not-for-profit organizations like alumni, environmental, cause and charity organizations through affinity credit card partnerships with credit card issuers. In one year alone the Penn State Alumni Association was said to have raised over $6M through its credit card partnership with MBNA. Think of the affinity credit cards with the likes of Ducks Unlimited, World Wildlife Fund, National Educators Association, Ohio State Alumni Association, AFL-CIO, AARP, etc… and you’ll get a feel for the scope of money raised. Apparently, one person’s pain can be another person’s gain.
See, credit cards aren’t necessarily the evil temptress everyone makes them out to be. Just think, where would Amazon or Itunes be without them? Would you still want to be carrying traveller checks or cash on your trip to Rio? Can you imagine paying for something and not collecting points?