The American Business Titan: Cornelius Vanderbilt

This work looks at the business giant Cornelius Vanderbilt, otherwise known as 'The Commodore'. During the 19th Century, Vanderbilt and his revolutionary business contributions were responsible for interconnecting America and building the foundations of modern-day US society. From the steamboat industry to the railroads, the Commodore dominated every industry he entered through his opportunistic business mind.

His business journey started in 1829 with the founding of his steamboat company and later transitioned into the railroad industry. Here he laid the foundations of his business empire, which enabled him to dominate the American economy.

Here we explore Vanderbilt's societal influences, not only in the 19th century, but modern-day society too! By considering his influence on the American business industry, we can understand how America grew to become the global power it is today.

Fun facts!

Vanderbilt's steamship success meant that the Commodore was a recognised business magnate. His recognition within the industry meant that he was approached by Secretary of War Edwin Stanton and President Abraham Lincoln during the Civil War for his steamship 'The Vanderbilt'!

His initial interest in the steamboat industry allowed the Commodore to become a millionaire by 1846.

Thus it is clear to see why Vanderbilt remains one of the most recognised business capitalists, not just throughout the 19th Century, but also today.

His contributions to the railroad industry meant that society was able to use interstate travel and discover new areas of the United States which would have previously have taken days or even months to reach!

The revolutionising of the steamboat and railroad industries resulted in the creation of new trade routes for civilisation which consequently led to the accessibility of new job opportunities which society could prosper within!

Through his monopolisation of the railroads, and investment into the steampship industry, the Commodore built himself an empire amounting to $100,000,000, $2,300,000,000 in today's money!

Absolutely not!

Cornelius Vanderbilt's story reflects how, despite his position of power and status, and endless fortune, the Commodore was unable to avoid mistakes and setbacks within his industries.

The fight for the Erie Railroad was one of the most memorable business takeovers in American financial history.

Controlled by Daniel Drew, the Erie Railroad had been a major transportation link which contributed to the development and economic growth of the Southern tier of the New York state, therefore its prevalence within society had held great importance.

1868 saw Vanderbilt express his initial interests in the major transportation line, and the beginning of the 'Erie War'. Like his previous business takeovers, the Commodore had intended to corner the railroad's stock and implement his control, which had previously been an easy task for Vanderbilt, however the Erie takeover had proved difficult.

The concept of the 'Robber Baron' had been introduced into American society, and had been used when characterising the business practices of Vanderbilt. This term would not only tarnish the reputation of Cornelius Vanderbilt, but also the reputations of businessmen Jay Gould and James Fisk. Both of whom were board members at the Erie Railroad.

Daniel Drew, owner of the Erie Railroad, first became familiar with Vanderbilt whilst operating within the shipping industry. During this period, Drew and Vanderbilt had contended as leading competitors within the industry, however, their battle ended with Drew forcing Vanderbilt to buy him out, leaving the Commodore impressed by Drew's daring tactics.

From here, both tycoons formed a secret partnership which would last for 30 years, creating an incentive to avoid competing against each other in the future.

Nevertheless, this partnership later turned sour, leading to a war between the two men...

Above shows two of the three main culprits responsible for the Commodore's failure in the takeover of the Erie railroad.

In 1867 Cornelius Vanderbilt started business proceedings to takeover the Erie Railroad, by secretly buying up shares of the Erie, triggering counterattacks from Drew, Gould and Fisk.

Due to Vanderbilt's successful monopolisation of the railroads, Drew, Gould and Fisk grew resentful towards the business magnate's actions.

As a result of patterns in the Commodore's business ventures, the three businessmen created a strategical plan to trap Cornelius Vanderbilt into buying fraudulent watered down stock. Unbeknown to the Commodore, he continued to invest into the railroad until it was uncovered that he was being fraudulently misled by the three Robber Barons, this was the most humiliating defeat experienced by Cornelius Vanderbilt.

Legal proceedings were eventually enforced against the three men, however in March 1868 the men fled across the Hudson River to New Jersey, protecting themselves against prosecution.

The Erie War resulted in Vanderbilt and Drew making a deal, however Gould and Fisk had once again manoeuvred around an agreement for the benefit of their own purse. Nevertheless, the Commodore would not be fooled again! He had the Erie Railroad buy back all watered down stock initially sold to him!

For more information on the Eerie War, check out the video below!

There is no doubt that Vanderbilt's business contributions to American society during the nineteenth century had built the infrastructure of American society as we know it today.

By connecting the United States through the shipping and railroad industries, Cornelius Vanderbilt had created a new method of transport for America which civilisation had never seen before.

The Commodore's business investments had led to a new way of living for American society. He had created new social and economic opportunities for civilisation, and his actions have left a significant mark on America which can still be seen today. He was responsible for the revolutionising of the steamboat and railroad industry, creating the nation's first railroad empire and will forever be known as one of the most important business titans that has ever lived.