America’s First Billionaire

I love researching self-made millionaires, especially those who rise from the bottom. These individuals are unique because the circumstances of their lives are often dire and set against them, more so than the average poor person.

That’s why I’ve spent some months researching and studying the life of Cornelius Vanderbilt.

Vanderbilt, or Commodore, as he was often called, was raised in Port Richmond, a primarily Dutch village on Staten Island, New York. His parents, Cornelius and Phebe Vanderbilt, came from nothing. “Low Dutch”, is what many called them.

Vanderbilt made his millions by controlling two burgeoning industries: the steamboat industry and the railroad industry.

When he died, Vanderbilt’s estate was estimated to be worth $100,000,000. That was back in 1877. In today’s dollars, that would be approximately $2.3 billion, making him the richest man in America, at the time.

But, in the early 1830’s there were many very talented people who were building a prosperous nation. So, what made Vanderbilt so unique?

Cornelius Vanderbilt possessed many of the Rich Habits:

• Love of Competition – Vanderbilt continuously kept his eye on the competition. He battled them as if at war, slashing fares and doing what he could to drive them out of business.
• Put Money to Work – Vanderbilt invested his profits in steamboats, he lent his money to other businessmen, he bought real estate and he purchased stock in private corporations. He personally invested millions in building Grand Central Station, one of the largest train depots in the world.
• Frugality – Vanderbilt controlled his money. He invested and spent it wisely. He looked for value in every dollar he spent.
• Entrepreneurial – Vanderbilt was not afraid to take calculated risks. Toward the end of his life, he even put his entire estate at risk in an effort to save one of his many investments – The Union Trust.
• Forward Thinker – Vanderbilt embraced new technologies, such as the steamboat, and a new form of business, such as the corporation.
• Desire to be Rich – Vanderbilt inherited from his mother his desire for riches.
• Live Below Your Means – Vanderbilt inherited from his mother another trait – spending less than you earn and then saving and investing the difference.
• Find a Success Mentor – Vanderbilt sought out Thomas Gibbons, a very wealthy, successful individual in the steamboat industry and then spent the first decade of his life as his employee. He learned everything about business from Gibbons, who mentored and molded him. Gibbons was the only employer he would ever have.
• Rich Relationships – Vanderbilt spent his lifetime building relationships with other success-minded individuals – individuals who would be able to open doors for him that were closed.
• Partner With Others – Vanderbilt understood that in order to succeed you must build a team of disciples. To this end, he enlisted, as partners, Daniel Drew, his son-in-law, Horace Clark and his own son, William. He then mentored them for many decades. Together, they helped him build his empire.
• Creativity – Vanderbilt came up with novel ways of controlling his steamboat companies, later called Vertical Integration – controlling every aspect of steamboat manufacturing from design through the operation of his steamboats.
• Never Quit – Vanderbilt never quit on his dreams. Several times, this would put him on the brink of personal bankruptcy.
• Truthful & Honest – Vanderbilt’s word was considered as good as gold. He never went back on his word. Everyone who did business with him found him to be a man of high integrity.
• Unpretentious – Vanderbilt, almost until the day he died, was never accepted by the wealthy class because he never flaunted his money.
• Avoid Debt – Vanderbilt grew his empire without debt. He never borrowed money.
• Healthy – Vanderbilt was a light eater, did not drink alcohol and was physically very active all of his life.
• Control Emotions – Vanderbilt was often described as the calm in the storm. He never panicked and was always in complete control of his emotions during turbulent times.
• Impervious to Criticism – Vanderbilt never allowed the negative words of others to affect him.
• Listener – Vanderbilt was considered to be a man of few words. He rarely talked. He let others do the talking and listened to what they had to say.
• Not a Workaholic – Vanderbilt would often vacation or relax in Saratoga Springs. It helped him to clear his head and recharge.
• Good Judge of Character – Vanderbilt was considered a very good judge of character. He embraced individuals of high character and went to war with those who were dishonest and untrustworthy.

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