From Palladium, February 2:
In the year 1800, a team of burglars broke into a factory in England to steal the workers’ payroll. The factory belonged to Matthew Boulton, an industrialist and inventor, as well as a polymath who hosted discussions with intellectuals like Benjamin Franklin, Joseph Priestley, and Erasmus Darwin.
Boulton got wind of the burglars’ plot. Like any sensible person, he decided the responsible thing to do was to assemble a posse of his friends and employees, give them guns, and lie in wait. As one biographer told the story:
The robbers…were allowed to break in and seize their booty, and were making off with 150 guineas and a load of silver, when Boulton gave the word to seize them. A quantity of tow soaked with turpentine was instantly set fire to, numerous lights were turned on, and the robbers found themselves surrounded on all sides by armed men. Four of them were taken after a desperate struggle; but the fifth, though severely wounded, contrived to escape over the tops of the houses in Brook-row.
Boulton enjoyed the adventure immensely, as he wrote in letters to family and friends. Boulton had other escapades as well. He organized vigilantes to chase counterfeiters through secret passages, and turned his workforce into a makeshift militia when rioters threatened to sack his factory.
However, we don’t remember Boulton as an eccentric adventurer. Rather, he’s remembered for his role in kick-starting the Industrial Revolution. After James Watt invented his steam engine and spent years laboring in a fruitless partnership with John Roebuck, Boulton befriended Watt and bought out Roebuck’s stake. Boulton quickly expanded his factories, which had previously made knick-knacks like vases and buttons, and began large-scale manufacturing of the steam engines which so far had been only prototypes. These steam engines were soon powering industry across Britain, and within half a century led to the development of railroads and steamships.
So why was a leading businessman like Boulton so prone to chasing burglars? Antics like his might be chalked up to youthful enthusiasm, except that he was 72 when he ambushed the burglars. You might expect such a long-standing captain of industry to be sober and conservative, rationally maximizing his gains with a minimum of noise and fuss. Perhaps his business life was more moderate?
Hardly. Even before he met Watt, Boulton was heavily overleveraged, staying ahead of creditors by expanding into new businesses with borrowed money and charm. After diving into the steam engine business, Boulton found that his earliest customers—copper mines—were on the verge of bankruptcy. To help keep them afloat, he invested heavily in the mines and bought large loads of copper. To make use of his new stockpiles, Boulton then personally designed a steam-powered machine to mint copper coins. When counterfeiters began copying these coins, Boulton grew dissatisfied with the police, organized his vigilantes, and hunted them down.
This is not unusual behavior for a man in Boulton’s position. Any survey of groundbreaking industrialists will reveal that they’re almost always a bit nuts. There are a great many examples cut from the same outlandish cloth as Steve Jobs, Howard Hughes, and Henry Ford. To restrict ourselves to people from our own time: Jeff Bezos declared in high school that he meant to move all of humanity into space and preserve the Earth as a huge international park; Peter Thiel is some kind of shadowy philosopher-vizier; Larry Page has poured a fortune into futuristic prototypes ranging from augmented reality glasses to self-driving cars to high-altitude balloons that broadcast internet service wherever they go; Elon Musk is Elon Musk. Mark Zuckerberg is almost unique in being a groundbreaking technologist who is a normie at heart—though it’s possible his obsession with Augustus Caesar, including the haircut, is more than just curiosity.
Where does this leave our archetype of the sober captain of industry? Are these people just a myth? Not at all. Pick five major corporations out of a hat, and in four of them, the leadership will be risk-averse managers whose vision of progress is one of incremental improvement to the status quo. There are a lot more Arvind Krishnas than Larry Ellisons.
The difference is that the sober captains of industry are rarely responsible for building new industries. The best of these people can guide an existing enterprise to ongoing success, as with Tim Cook, who developed Apple into the world’s most highly-valued company; or they can build new enterprises using technologies and business models that have been proven elsewhere, as with Leland Stanford, the railroad baron who linked California and the American Southwest to the rest of the country. But large-scale economic innovations require different skills and a different mindset....
....MUCH MORE
