The first million the hardest : an autobiography

Front matter

THE

FIRST MILLION

THE HARDEST

Preface

THE eighty years of whose activities this volume contains my recollections show notable changes of scene. Beginning in a country neighbourhood, twelve miles from the nearest railroad; passing from farm to machineshop, thence through the grades of apprentice, foreman, partner, and in time head of the business ; attending numerous conventions; serving on commissions for state and nation; taking an active part in many societies and associations which had for their aim the promotion of the public weal; on frequent journeys throughout the country or abroad, making acquaintance with all sorts and conditions of men — my life, stretching as it has over that eventful period in our national history which began before the Civil War, has been most interesting to lead, and, I trust, may be found interesting to read. The assurance from many of my friends that a record of my experiences would be of interest, together with the solicitations of an editor that I contribute a series of articles to his magazine, finally overcame my doubts; and a stronger influence was the expressed belief of many that such a record might be of service.

viii Preface

However short I may have come of realizing my desire, my controlling aspiration has been to be of service, and if to the power to entertain, I might add the power to make my reader more zealous, more hopeful, more courageous in his own undertakings, I shall feel justified. Of this the reader must be the judge.

Too often when a life is closed our sense of loss is aggravated by the thought that so little is left to show the inner personality of the one whom we knew. The working of a man's mind and development of his character are interesting studies in themselves; and the increasing number of readers who appear to agree with good old Dr. Samuel Johnson's remark, "Sir, the biographical part of literature is what I love most," emboldens me to hope that this volume, whatever its shortcomings, may find a welcome.

The association with Mr. Samuel Crowther, in collaboration with whom these Memoirs have been prepared, has been most pleasant, and the friendship therefrom resulting I consider ample compensation for the labour they entailed. To him is due great credit for any merit the work may have. My secretary, Mr. Guy C. Stover, has also been of material assistance.

With gathering years one's circle widens, one comes into contact with more of his fellows, there is more in the retrospect, and I have always believed that in a normal life one should grow

Preface ix

happier with added years. This has been my experience; and to those who read these words, I send greetings from the sunset trail, with the wish that they may find as much satisfaction as I have had in association with others, and that peace and happiness may attend them as they tread the road that now stretches far behind me.

A. B. F.

York, Pa., New Year's Day, 1922

Contents

CHAPTER PAGE

I. The Quest of the Million-Dollar

Secret 1

Chapter I

>VERYONE remembers the remark of the late Dr. William Osier that the initiative comes from men under forty and that older men might as well be chloroformed. Doctor Osier was one of my warm friends and he asked me to his home in Baltimore to dinner just before leaving for his chair at Oxford some years ago. He told me that he had gotten more reputation out of what he said in fun than out of anything he ever said in earnest — that he had jokingly advised chloroform for a lot of elderly college professors at an alumni dinner in an effort to jolly the younger men. And then I asked him if he thought I should retire — I was then approaching seventy. He answered :

"No, you have not yet reached forty. The years have nothing to do with it. It is one's mental and physical condition that makes age. You will probably be young as long as you live."

I have now behind me more than twice the fatal forty years — on the calendar count; I have known most of the great figures of the nation during the last sixty years. I have seen the change from a farming to a manufacturing country, and have seen manufacturing grow from little-shop hand work to great-shop machine work. Many of the things that we use to-day and deem necessities were unknown to business when I first entered it. Other big figures have replaced the big figures of yesterday, but because, according to the formula, I have not yet reached forty, my interests are of to-day and of the men of to-day. And I hold that yesterday is important mainly as its experience becomes a mentor for to-day. If it were not for that I would drop yesterday and again be wholly as young as on that day long ago when I started to New York to ask A. T. Stewart, William B. Astor, James Gordon Bennett, and several other noted men the simple, direct question: "How can I make a million dollars?"

That journey, which — in a very literal way — marked my breaking into business life, happened in 1858 before I was twenty. The modern recipes for making a million dollars overnight and sold on a subscription basis had not as yet been invented. There were practically no books of business instruction; one just grew up, like Topsy, in business. But I happened across an issue of Harper s Magazine which described the successful men of New York, and immediately became fired with the notion that the way to get along in the world more rapidly than the next fellow was to find the secrets of those who had made the high scores. It was not that I was greedy for money, for the whole teaching of my father had been to the end that no one could properly be called a man who let his love for a dollar interfere with his love for a book — which is a precept that has always stayed with me.

But I did want to be successful in business, and yet, though success in business is not measured only in dollars, I then thought it was. Therefore, the question which I thought would most attract these several gentlemen and secure attention exquisitely compressed that particular philosophy of business life into: "How can I make a million dollars? " With that single query in mind I started fresh from my home in Sandy Spring, Maryland, to see the larger money kings of the nation on their thrones in New York.

I was only a raw country lad but had had the advantage of more than the usual amount of education, for my father and mother, although not at all wealthy, were exceptionally cultured people, and the family had been trained in the love of books and of study. I had never been to New York, I had seen little of what is known as life, and therefore it did not strike me as at all an extraordinary proceeding to talk to the country's rich men without the preliminary of an introduction. It never occurred to me that they would not be ready to see me or glad to answer my questions, for I had always been in contact with people who were glad to see any one who happened along and to answer their questions. Up to that time asking questions had been my foremost occupation. I do not ask so many now, but I still consider that asking questions is about the most useful way that a young man can put in his time — provided that he uses a reasonable amount of intelligence in framing the questions and digesting the answers.

That was a big, adventurous journey, and, by to-day's standards, a hard one, for the trains were slow, the stops frequent, and when one dozed off, the yell came to change cars. Of course there were no sleepers. It took, I think, fourteen hours of travelling before the ferry from Jersey landed me in what I thought was a very big city. It was then seven in the morning.

The New York of to-day would regard that big city as nothing but a fair-sized town. There were no great buildings ; few of any kind had more than three stories. They were mostly of red brick and very plain and solid. Some of the streets were roughly paved but many were not much better than country roads and many were lined with trees. Above Canal Street it was country and Canal Street was a canal. I distinctly remember the boats on it. All of this I saw incidentally. I had started to

New York to ask questions, and the moment I got off the ferry I went to the old Astor Hotel, left my bag, and without waiting for breakfast started for William B. Astor's office, reaching there about eight o'clock.

He had two little rooms; in the outer was an old round-shouldered clerk and in the back room, writing at a plain board table, was a heavy-set man with a full face and bushy brows whom I instantly recognized from the picture in the magazine as Mr. Astor. The furniture was unpolished, there were no decorations of any kind, and a rough mental inventory gave me a value of about $20. The old clerk glared at me without welcome and growled :

"What do you want?"

"I want to see Mr. Astor."

"You cannot see him. He is busy," he growled again, and then made a grab at my coat as I tried to dive past him. I shook him off and landed somewhat ruffled before the desk of the richest man in the country. He had heard the scuffle and looking up from his writing snapped :

"Well, boy, what do you want?"

I drew up a chair by him and said: "I want to know how to make a million dollars."

Right away his testiness left him and he smiled just a little as he answered ruefully :

"Do you want to make yourself as miserable as I am, and stay up all day and half the night trying to keep people from cheating you? I never made any money myself. It takes all my time to collect rents and to see that people do not get away without paying their rent."

Then he told me to sit down and he explained how his father had thought that New York would grow into a great city and had bought land cheaply in what he believed would be the march of the city ; and then as time went on and streets were cut through it, he had sold off all but the corners, and these he had rented, and that he, the son, was collecting the rents. He spoke about the power of invested money and referred feelingly to what would have happened if old Moses, as he called him, had only put a penny out at interest and let it go on compounding.

"But," he went on, "there is nothing in it. I do not have enough fun. I am too afraid that people will cheat me and, in spite of everything, they do cheat me. If you really want to know how to make money you had better go to see some of the men who have made money and not waste time with men who do nothing but try to keep and increase what they have." I showed him the list of men whom I expected to meet, copied from a magazine. "Go over and see Stevens," said he, "at the Bank of Commerce, whom you have on your list; he may give you some good advice. See A. T. Stewart; he has made his own money. And then there is George S. Coe at the American Exchange

Bank: he is a nice fellow. And James Gordon Bennett has good ideas."

I thanked him, and as I left he asked me: "Do you expect to see all the men whose names you have on your list?"

I replied, "Yes, I shall tell them that Mr. Astor sent me."

"Don't do anything of the kind," he returned, snappishly.

"I am going to anyhow," I answered, my courage rising. " It is true, you did tell me to see them. " He laughed a little and rejoined:

"All right, go ahead. You'll do."

Men went to their offices early in those days; they used all of the daylight. Shortly after nine o'clock I was at the office of John A. Stevens in the Bank of Commerce, which is now the National Bank of Commerce. Their four-story white marble building was almost the finest in the city and to me very imposing. It stood at the corner of Cedar and Nassau streets. To-day that is a busy point with the great Equitable Building hard by and more people passing in an hour than were then apparently in all New York. Across from the bank was an open square and above, at Liberty Street, was the Post Office with a steeple and looking more like a church than a public building. The bank was then an important one but it was only later during the Civil War that people found out how really big a man President Stevens was; he many times came to the rescue of the Government in the haphazard war financing. To my personal knowledge he responded to a call of President Lincoln and assisted in financing the first $50,000,000 loan.

I told an attendant that Mr. Astor had sent me over to see Mr. Stevens and at once he showed me in. Mr. Stevens had a somewhat better desk than Mr. Astor, but there was nothing of the modern bank president's furnishing about the place; it was all very plain and without the slightest thought that it was necessary to make a showing in dress or in furnishings in order to give an impression of financial stability. Mr. Astor had not been dressed any better than his clerk and Mr. Stevens might have been almost any one. In fact, of all the men I met that day only A. T. Stewart dressed and acted the part of the rich man. The others were decidedly below my estimate of how a rich man would be expected to dress and act. Since then offices have changed and many men, and especially bankers, find it advisable to surround themselves with the appearance of wealth, but I find that the really great men of the country rarely have ostentatious offices, and I know of none who go in for extravagance in dress. Now and then a man, when moving his office, decides that the new office will be something to make people sit up, and he hires a decorator, gets the finest imaginable furniture — and then hardly ever uses it. But to get back to

Mr. Stevens. He was very cordial and he laughed when I said:

"I just asked Mr. Astor how to make a million dollars. Then I showed him the list of people I had come to see, and he said you could give me some good advice."

"I am in the same boat with Astor," said Stevens. "I never made any money. All I do is take care of the money that other people make. The man for you to see is George S. Coe — and I shall send you right over to him. I think he has a board meeting this morning and if you get in there you will meet a number of men who can tell you more than I can."

With that he called a messenger and I was escorted around to the little building of the American Exchange Bank.

George S. Coe was, I believe, the youngest bank executive in New York, being then vice-president and afterwards president of the bank. He, too, seemed glad to see me — the Astor name had carried me along — and he asked me to stay until the board had met, when he would call me in. Fancy a metropolitan bank president of to-day holding a board together to talk with an unknown young man who desired to learn how to make a million dollars! But by that time I was quite at ease in the higher financial circles. Of the men I met at the bank I recall, besides Mr. Coe, only David Hoadley, Charles J. Stedman, William C. Langley, and Edwin Thorne of the directorate — and Robert S. Oakley the cashier. They all talked with me.

The code of those men was extremely simple; they were traders rather than manufacturers — for New York had already taken on its character of a clearing house for the overseas commerce, although as compared with to-day only in a small way — and the most striking recipe for success which they had to offer, as I remember, was about this:

"Take care of your character, never break a promise, and give value for what you get. Avoid speculation." An old man whom I met in the bank and who I think was Hamilton Fish, put the advice this way:

"If you never break a promise, if you always pay the money you owe exactly on the day it is due, nobody will know but that you are worth a million. And you will be just as good a risk as a man worth a million, for all that he could do would be to pay on the due date."

They had no short cuts to suggest and curiously enough, not one of them even spoke of technical or other proficiency. They were concerned only with fundamentals. I gathered from them that if one were scrupulously honest, industrious, and economical, then the other business qualities came almost as of course — but without the fundamentals nothing else mattered. In a word they confirmed in me the lines that had been given to me in childhood founded on the text that "God is not mocked" — that is, that you cannot trifle with Nature's laws. And after all that is about the best recipe for success in business that exists. Having known many of the larger business men of the country during the last fifty years, I do not recall one who achieved any measure of permanent success who did not have these fundamental qualities. Men without them, indeed, have sprung up but their success has been ephemeral, and, although temperamentally some of these older men could not have managed the larger enterprises of to-day, the difference between them and to-day's successful men is only in what might be called detail.

Those men were elemental; they did not work through others as people do to-day. They did everything themselves. They did not have secretaries. They did not, as I later learned, delegate anything which required the exercise of discretion. They signed every cheque and in many cases personally made up their bank deposits because the handling of money was something which, it was considered, should not be entrusted to another. Stenographers or typewriters had not been heard of, no system of letter-press copying had even been invented. Even the busiest man wrote all his shorter notes by hand. The longer letters he dictated to a long-hand writer, and an active man could, without difficulty, dictate to two clerks at once. The clerk did not have to know a great deal, but he did have to be able to write, not merely legibly, but attractively. A few of the big men had letterheads with their names and addresses printed on them, but the letters of the majority went out on plain sheets of ruled paper. My impression is that William B. Astor did not have a printed, much less an engraved letterhead. Since the labour of copying letters in full would have been very great, only the highly important letters were copied in full and memoranda of the contents of the lesser letters taken. Sometimes the notes were kept in a book, but more often on loose sheets of paper, and, since there were no filing systems, locating correspondence and data was purely a matter of memory.

What made these men rich and powerful was not only their scrupulous honesty and high character but also, and this is a point I have never seen dwelt upon, their extraordinary memories. There were no bookkeeping systems, the books were elaborately kept in so far as penmanship was concerned, but really all they showed was income and outgo. They showed nothing of costs and overhead expenses and the really big merchant had to keep all of his concerns right in his head. A merchant had his business under his hat — no matter how great were his interests. He knew what things cost, what they ought to cost, what they ought to sell for; he knew the accounts of all of his customers; he did not deal with strangers; he knew his bank balance from day to day, and his outstanding bills.

In fact, a great merchant kept in his head a good part of what it now requires a considerable bookkeeping staff to collate, and it was the ability to do all of this and to judge character and estimate values as by intuition that distinguished the big man from the little man.

From the bank meeting I went over to see the founder of the New York Herald, James Gordon Bennett, at the office near the old Astor House on Broadway. Everybody at the bank meeting had told me that by all means I should see both Bennett and Stewart. I had no trouble seeing Mr. Bennett. He was in a little office all alone at a plain desk. I started to tell him what I wanted but before I had said a half dozen words and was just beginning to realize that his remarkably keen eyes were looking right through me, he broke in:

"Look here, young man, you look as though you had not eaten breakfast."

So interested had I been in my quest that it had not occurred to me to eat anything. Too many other affairs of importance had been happening to warrant bothering about breakfast.

"Whenever you see anyone," he went on, "you ought to be at your best. You cannot be at your best if you are hungry. Go out and get your breakfast and then come back and we shall have a talk. Give this card to the head waiter at the Astor House."

I went across the street, presented the card to the head waiter who thereupon escorted me ceremoniously to a seat and served me himself — which, let me say, was a full-sized man's task, because the moment I was seated at the table I began to realize that I was just about as hungry as a boy can be. While I ate, the head waiter stood beside me and we talked about various men in New York, and especially about Mr. Bennett. When I had finished I asked for my bill and the waiter answered :

"There is nothing to pay. This is Mr. Bennett's treat. He frequently sends people over here."

Then I went back to the Herald office filled with a desire first of all to pay for my meal because I could not see any reason why any one should spend money on me. I started the subject with Mr. Bennett but instantly he dismissed it.

"Nonsense!" he said, "let's talk about something important. The really important thing for you to know as a young man is that you must bank up a health account. Look at me, I am never sick. I never take a vacation. I am here at the office early in the morning and sometimes late at night. But I always try to be in bed early enough to get a good night's sleep. If you get plenty of sleep and be careful of your diet you will never be sick."

And I think that advice is good. I have rarely been ill, I am in perfect health to-day, and although through many years I worked at least fifteen hours a day, I always managed to get six hours of sound sleep, and I still arrive at my office at seven in the morning. Franklin said that six hours is enough sleep for a man, seven for a woman, eight for a fool.

All the men I had seen until then had been glad to talk with me with the exception of Astor, and he had warmed up after the first few seconds; but they warned me that I might have trouble in seeing A. T. Stewart, who had a considerable reputation for austerity. I went to his establishment and was shown to the floor on which he had his office. Instead of being shut off in a little room by himself, Mr. Stewart had his desk behind a glass partition in the corner of a room of the lower floor, which was filled with clerks. He had established himself in a kind of observation post from which he could see what everyone was doing. I asked to be shown in to him but the attendant said that was impossible, that Mr. Stewart had either just started or was about to start home for dinner and could not be seen. He talked for a few minutes and after I had used the name of Mr. Astor we became quite friendly. He asked me if I would know Mr. Stewart when I saw him and I told him that I thought I could recognize him from his pictures. Then he suggested this plan:

"He will have finished his dinner and will come out of his house at exactly a quarter past one. He will have a newspaper in his hand and he will get on a bus. You get on the bus with him, get a seat beside him, and when he looks up from his newspaper, but not before, then you start to talk to him."

The plan worked, although I shivered as I watched him reading the paper, for he appeared to me a remarkably cold, stern, unapproachable looking man. I do not know exactly what I said to him at first, but he soon began to take an interest, and more especially when I told him what other prominent men had said of him. He talked rather generally on character and on always attending to your own affairs, and I went with him from the bus to his office.

As we were passing one of the aisles a man was sweeping up and Mr. Stewart's eye caught some rags among the litter. Rags were much more valuable then than to-day, because that was before wood pulp was used in paper making. Immediately he stopped, walked over to the sweeper and in imperious voice reprimanded him for his wastefulness. Then we went on into the office and at once I asked:

"Did it not use up more of your time to speak to that sweeping man than the rags were worth?"

"That's true," he answered, "but you will notice that I spoke so loudly that everyone in that room heard what I said. I meant that they should, so as to give them a lesson in saving, for money is made by saving — saving and investing. You get your profit out of the leaks that you stop."

He said that every penny which is saved ought to be invested. The place to invest was in your own business, up to the point that you can there use the money profitably; that it was best to save so that whenever your business needed money you could provide it yourself and not have to borrow. I believe this is a principle which he scrupulously followed. I talked on various subjects with him and his assistant, Mr. Libby. I then asked Mr. Stewart if the report I had heard was true, that in selecting assistants or men for important places he gave preference to men who had been in business and failed. His reply was characteristic. He said:

"It is a great advantage for an employer to have men who have been in business for themselves and who have failed. The mere fact that they start in business shows that they have initiative and ambition, which are very valuable qualities. The fact that they fail on their own account shows them that they are not competent to manage their own affairs, and demonstrates to them that their best interest lies in casting their lot with those who know more about business than they do and who have the advantage of both skill and capital. This insures loyalty.

"Of course, these men must have failed honestly. I always look into the facts of the failures carefully and do not take a man whose business record is bad, but if his failure has simply been due to an inability to look after his own affairs and without any trace of sharp dealing, he is the best man for me."

A. T. Stewart was the absolute master of his business. As I have noted, all of the men I met were the heads of one-man concerns. Astor was the Astor estate; James Gordon Bennett was the Herald. They were despots, absolute rulers, and they were inclined to be paternal. It was unconscious paternalism that caused Mr. Bennett to give me a meal ticket. The most absolute and stern in demeanour was A. T. Stewart. All of them gave orders where the modern executive makes suggestions. And, although these men were elemental and meant to be kindly, they were, as I compare them with the men of similar calibre to-day, more arbitrary and in their business affairs more self-centred. They worked with things while the man of to-day works with people. They were in the way of being pioneers, and I suppose a pioneer gets pretty well calloused all over. They were busy because they had none of the modern facilities — although most of them were so jealous of their personal power that I doubt if any would have listened to the thought of delegating an essential task. I think, taken all in all, however much we may admire the characters and the granite firmness of these really big men, that the type of big man to-day is more interested in humanity and thinks considerably less of himself and more of those about him.