Starting from nothing, John Davidson Rockefeller made his fortune in oil at the end of the 19th century. A fortune estimated at 340 billion dollars. This wealth will end up indignant the United States, a country which nevertheless cherishes adventure and personal successes
Rockefeller was born into a large and poor family in Richford upstate New York that moved several times before eventually settling in Cleveland, Ohio. Pious and austere, her mother preached hard work and good deeds to her six children. His father is a salesman who leads a licentious but remunerative life. The rigor of the mother combined with the uninhibited creativity of the father will forge the temperament of the young Rockefeller and train him in the business world. On the father’s side, he discovers risk taking and the lure of profit. On the maternal side, he learns daily frugality, work, self-control, management and planning.
Forced to give up his studies, he launched into working life very early. At the age of 16, he found a job as a paper worker in a wholesale trade house. He carried out his profession meticulously and quickly rose through the ranks, becoming in two years an accounting assistant then chief accountant. This step is crucial for the future entrepreneur since it trains him in commercial accounting and logistics.
In 1859, Rockefeller and a partner established their own commission firm. That same year, America’s first oil well was drilled in Titusville, Pennsylvania.
In 1862, Rockefeller joined with two partners to establish an oil-refining company. The men purchased oil wells in Titusville, Pennsylvania, and constructed a well near Cleveland. In 1865, Rockefeller bought out one of the partners’ interest in the company, creating Rockefeller & Andrews Oil Company. In this year alone, the business earned approximately 200,000 dollars.
While Rockefeller reaped extensive wealth in the mid-1860’s, the oil industry was just beginning to grow. Most people only used oil for lighting. The market was limited. Prices fluctuated dramatically, as oil production waxed and waned during this period.
In 1870, Rockefeller abolished the partnership and incorporated Standard Oil in Ohio.
During the 1870s and 1880s, Rockefeller sought to expand Standard Oil’s influence. The company began to purchase or drive out of business oil refiners across the United States. By 1878, Standard Oil purportedly controlled ninety percent of the oil refineries in the United States. In 1881, the Standard Oil Company became known as the Standard Oil Trust. In essence, the Standard Oil Company created various companies across the United States that were purportedly their own entities. In reality, Rockefeller directed all of these businesses.
During the 1880s and 1890s, Rockefeller came under attack from the federal government for having created a virtual monopoly over the oil industry. In 1890, John Sherman, a senator from Ohio, proposed an anti-trust act, authorizing the federal government to break up any businesses that prohibited competition. The Standard Oil Trust effectively eliminated competition. In 1892, Ohio’s attorney general filed suit against Rockefeller and his company. While Ohio won the case, Standard Oil appealed the decision. In 1911, the United States Supreme Court eventually ruled in this case that Standard Oil was a trust and had to cease to exist. The company then splintered into numerous subsidiaries. In theory, these companies were no longer owned by a single person or operated by a single board of directors, but it appears that they still operated in conjunction with each other. Among these various companies were Standard Oil of Ohio, Standard Oil of Indiana, Standard Oil of New York, Standard Oil of New Jersey, Standard Oil of California, Standard Oil of Kentucky, Standard Oil of Iowa, Standard Oil of Minnesota, Standard Oil of Illinois, Standard Oil of Kansas, Standard Oil of Missouri, Standard Oil of Nebraska, and Standard Oil of Louisiana. Other companies used the Standard Oil name to profit off of the company’s reputation, but these organizations were never part of the company formerly controlled by Rockefeller.
The Standard Oil Company of Ohio was the original company that Rockefeller established in 1862. In 1911, following the Supreme Court ruling, Standard Oil was broken into seven successor companies; Standard Oil of New Jersey, Standard Oil of New York, Standard Oil of California, Standard Oil of Indiana, Standard Oil of Kentucky, The Standard Oil Company (Ohio), and The Ohio Oil Company. Standard Oil Company, also called Sohio, in effect, ceased to exist after being purchased by British Petroleum (BP) in 1987, although BP continued to sell gasoline under the Sohio brand name until 1991. Atlantic Richfield (ARCO), a merger of Standard’s Atlantic and an independent company called Richfield, and Standard Oil of Indiana (Amoco) were eventually absorbed into BP as well. Later, BP sold the ARCO name and oil fields in Southern California to Tesoro, which were eventually purchased by Sunoco. The Ohio Oil Company is now Marathon Petroleum, which includes both Marathon and Speedway filling stations.
Rockefeller’s charitable giving began with his first job as a clerk at age 16, when he gave six percent of his earnings to charity, as recorded in his personal ledger. By the time he was twenty, his charity exceeded ten percent of his income.
As Rockefeller’s wealth grew, so did his giving, primarily to educational and public health causes, but also for basic science and the arts.
Rockefeller gave $80 million to the University of Chicago turning a small Baptist college into a world-class institution by 1900. He would describe the University of Chicago as “the best investment I ever made.”
He also gave a grant to the American Baptist Missionaries foreign mission board, the American Baptist Foreign Mission Society in establishing Central Philippine University.
Rockefeller had a long and controversial career in the oil industry followed by a long career in philanthropy. His image is an amalgam of all of these experiences and the many ways he was viewed by his contemporaries.
According to Bloomberg, Rockefeller’s $1.5 billion was about 1.6% of the US economy in 1937. Were he to own the same percentage today, his fortune would be almost triple Jeff Bezos’.
In his 50s Rockefeller suffered from moderate depression and digestive troubles. He died of arteriosclerosis on May 23, 1937, less than two months shy of his 98th birthday, at his home in Ormond Beach, Florida. He was buried in Lake View Cemetery in Cleveland.
(Source: history.com/Wikipedia/Ohio History Central/Bloomberg – Rockefeller’s refinery in Cleveland in the 1860’s)