I recently finished listening to “The First Tycoon: The Epic Life of Cornelius Vanderbilt“, a biography of Cornelius “Commodore” Vanderbilt written by T.J. Stiles. This 29 hour audiobook is a true rags to riches story. Vanderbilt rose from boatman to builder of nation’s largest fleet of steamships to lord of the railroad empire. This biography talks about the challenges Vanderbilt faced in his personal and business life, and how he ceased the opportunities that came his way. Vanderbilt propelled the California gold rush, aided Lincoln in the Civil War with his steamships, and reshaped the transportation industry. It is important to note that Vanderbilt was already powerful when Carnegie (Steel man) and Rockefeller (Oil man) started their journey to great wealth. I do not think Carnegie or Rockefeller could’ve become the titans they are known for without Vanderbilt’s railroads. Railroads were the backbone that helped US economy prosper. In this blog post, I will talk about 5 lessons I learned from Cornelius Vanderbilt’s biography:
- Recognizing and Seizing Opportunities – Vanderbilt’s original business was to ferry freight and passengers between Staten Island and Manhattan. At age 23, he as approached by Thomas Gibson. Gibson asked Vanderbilt to captain Gibson’s steamboat from New York to New Jersey. Vanderbilt saw that although it was a small steamboat, this opportunity would give him exposure to the cutting edge steamships. So, he accepted Gibson’s request. Vanderbilt soon became Gibson’s business manager. This was the beginning of him building the largest fleet of steamships. He had one opportunity, and he seized it.
- Have a Ruthless Reputation – Throughout his business career, Vanderbilt would go after whoever cheated or conned him. For example – once when Vanderbilt was out of the country, he was voted out of his company’s leadership by his partners. After coming back to the country and realizing what his partners did, Vanderbilt is said to have written this letter to his partners:
You have undertaken to cheat me. I won’t sue you, for law is too slow. I’ll ruin you.
A few years down the line, he overthrew his partners and regained his leadership position in that company.
- Have a “Winning is Fun” Attitude – Vanderbilt loved winning. He liked winning more than making money. He believed that it was fine to take a loss, if it meant that it would result in a larger loss for the competitors. He would always have ample cash ready for when the perfect buying opportunity came up. Vanderbilt was a short seller’s worst nightmare – Vanderbilt would keep buying shares of railroad stock, when people were speculating for the company to go bankrupt. Just to prove that railroad was the future, Vanderbilt single handedly drove the price of the company up. After any setback, Vanderbilt would come back roaring by making that obstacle into a winning deal. Diplomacy, cooperation, and consolidation were the primary themes behind his successful reign.
- Be flexible – Throughout his life, Vanderbilt was willing to adapt to the changing trends. When he was 70 years old, he decided to leave his shipping empire and get into railroad business. He loved challenges. He started as the railroad director in 1863, and began consolidating the railroads. He revolutionized the railroad industry, and actually made the capital intensive business profitable.
- Know other businesses’ vulnerabilities – Vanderbilt knew how to get his point across. If businesses didn’t consider Vanderbilt’s requests seriously at first, Vanderbilt would bring them to their knees until they were left with no leverage to negotiate. For example, when New York Central Railroad did not want to cooperate with Vanderbilt’s railroads, he stopped traffic from going to New York. By cutting New York out, he clearly pointed out the vulnerability of NY Central Railroad. He knew that, in January, trade over water bodies would close since the water would freeze. So, he actually waited until January to halt those rail transports. In other words, he made New York vulnerable until he got what he wanted. Vanderbilt eventually became the president of New York Central Railroad.
Overall, I liked this book. Although some parts regarding Vanderbilt’s interests in the Panama Canal were a little boring, other parts about his life were entertaining. I loved learning about the contributions he made by helping Lincoln during Civil War; “The Vanderbilt” steamship was massive and was the most feared ship amongst the confederacy. Looking back, I don’t think Vanderbilt could have become a titan had he not accepted to become the captain of a small steamboat for Thomas Gibson; that one decision opened all doors for him. Throughout the book, I noticed that Vanderbilt was diligent and determined to pursue his goals. After having multiple near death accidents, Vanderbilt survived because he had goals that he wanted to materialize. Towards the end of the book, the author points out that Vanderbilt owned $1 out of every $20 in circulation. He compared this to when Bill Gates became the richest man, he possessed $1 out of every $120. It is amazing to see how Vanderbilt began his career and what he was worth when he died. I would recommend this book to anyone who is curious about how someone can amass so much wealth in his lifetime. It is an inspirational journey.
Hope you learned a little and found this blog post helpful. We talked about Cornelius Vanderbilt’s biography: “The First Tycoon: The Epic Life of Cornelius Vanderbilt” written by T.J. Stiles. We talked about the top 5 takeaways from his life story. As always, you can sign up for our mailing list here. Like us on our Facebook page here. Thank you!
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