Britain’s rise to global dominance from the 16th century onwards owed as much to the vision and creative energies of traders, merchants, industrialists, and bankers as it did to wars of conquest fought by empire-building military men. Dragons tells the story of British business endeavor through the lives of 10 titans of commerce. Beginning with the Tudor merchants who transformed England’s economy via trade with the New World, Liam Byrne traces a golden line of British entrepreneurial genius through men such as Thomas Pitt, savior of the East India Company; financier Nathan Rothschild, creator of the modern bond market; "ethical capitalist" George Cadbury; and William Lever, brand-builder, philanthropist, and creator of Britain’s first great multinational. At the start of the 21st century, Britain remains a major economic power. Dragons is both a rousing celebration of British business acumen and a fascinatingly informative narrative of a neglected but essential strand of our island’s story.
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About the Author
Liam Byrne MP is the Shadow Minister for Universities, Science and Skills. A technology entrepreneur before entering politics, he was a Fulbright Scholar at the Harvard Business School. He is the author of Turning to Face the East.
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Ten Entrepreneurs Who Built Britain
By Liam Byrne
Head of Zeus LtdCopyright © 2016 Liam Byrne
All rights reserved.
THE NATION'S FOUNDATIONS
Pioneers of fleece and finance: William de la Pole, Dick Whittington and Thomas Gresham
Somewhere beneath the church of St Michael Paternoster Royal on College Hill in the City of London, lie the bones of England's most famous entrepreneur. There is no statue to Dick Whittington in his final resting place. The English merchant – immortalized in plays and poems, whose name and story inspire pantomimes every Christmas – is remembered there with a simple Modernist stained-glass window, in green, red and blue. High in the church's south wall, it portrays a handsome, clean-jawed young man in an overcoat and flat cap, his worldly goods bundled in a red handkerchief tied to a stick across his shoulders, and beside him, of course, his cat.
The legend goes that Whittington, a poor Gloucestershire lad, walked to London, where he had heard the streets were paved with gold. Lodged in the home of a rich merchant, he fell in love with Alice, the daughter of the house, and bought a cat to eat the mice in his attic room. When the merchant invited his servants to invest in a voyage abroad, Whittington had only his cat to offer. Down on his luck, he resolved to quit the city, but on Highgate Hill he paused to hear the bells of St Mary-le-Bow ringing, 'Turn again, Whittington, three times Lord Mayor of London.' Inspired, young Dick turned back to learn that his master's ship had not only reached a foreign land, but in the rat-infested court of a foreign king his cat had rendered so great a service that it was bought for great sums of gold. Suddenly a very wealthy man, Whittington married Alice, invested wisely, and, as predicted by the bells, became Lord Mayor of London.
It is a marvellous story, probably inspired not by the perfect truth but by a Persian folk-tale. Yet when archaeologists searched for Whittington's bones after the Second World War in the ruins of a bombed-out St Michael's Church, they found no body – it was perhaps plundered by grave robbers – but there was a mummified cat.
In truth, Richard Whittington was born in 1350, not long after England's great poet Geoffrey Chaucer, and was the youngest son of Sir William Whittington. Standing to inherit nothing, he turned his hand to trade, settled in London and made a fortune. He became the capital's leading mercer, with a huge business selling fine cloth to king and court. Whittington and his generation were immortalized by Chaucer in The Canterbury Tales, but in fact, they stood on the shoulders of the giants who had come before them: the pioneering English merchants who had wrestled control of the nation's great trade in fleeces and royal finance from the Flemings and Florentines who dominated the commerce of medieval Europe.
Their marketplace was the Continent where in the millennia since the Mesolithic era intricate social networks had taken shape, providing the pathways along which were swapped commodities, money and ideas. As far back as 3000 BC, roads, rivers and coastal sea lanes connected farming communities and market-centres, where traders could exchange food, metal, stones and furs. At Europe's centre, Alpine passes connected the lands of the later Holy Roman Emperors, while the 'amber route' from the Adriatic around the East Alps led to the Danube, Oder and Baltic. To the east, river routes linked the Baltic to the Black Sea, and Byzantium to Baghdad via the Caspian Sea and Caravan routes along the Silk Road. This network allowed merchants to show up in unusual places. Thus the Viking prayer, 'I wish that you would send me many merchants with many dinars and dirhems who will buy from me whatever I wish and will not dispute anything I say.'
As the population of Europe doubled between AD 950 and 1200, the number of urban areas quadrupled, and as heath, forest and marsh were rolled back across the Continent, towns multiplied. In 1200, perhaps forty-five European towns were founded; in 1300 it was two hundred and fifty. Often as small as 200 or 300 souls, these towns were set apart from the surrounding countryside. But behind their walls citizens enjoyed rights their rural neighbours did not. They flourished from trading the surplus of surrounding manors, becoming centres of skills and monopolies of the production of goods and services. Out of the so-called Dark Ages a 'new West' emerged – the progenitor of the first world economy – wider and more impressive than the Roman Empire, its ambit stretched not just to the Mediterranean but to the Baltic too, and the lands beyond Rome's old northern Rhine border.
Despite the great division of Dark Age Europe, between a Frankish-west, a Greek-dominated east (better known as the Byzantine Empire), and the Islamic south, major transcontinental corridors connected the communities that lived between the Mediterranean and the Baltic to two great northern and southern hubs of trade. In the south, the great marketplace was the end of the Silk Road – first, Byzantium's capital, Constantinople, and then Venice and its islands of the Rialto. In the north, the great trading hub comprised the towns and fairs of Champagne and Flanders. Here, an English merchant could buy a dizzying array of goods: Bordeaux and Gascon wine; salt from Biscay or the Bay of Bourgneuf; Spanish iron; candles; fishing furs; silks and spices from the Orient; dyed plants from Picardy and Toulouse; wood ash from Polish forests, alum from Genoa and Gascony, and wool oil from Spain; dyes such as woad, orchil and brasil from Castile and Portugal; iron from Biscay, timber and flax from Ireland, and fish from Iceland; hundreds of thousands of furs – squirrel, ermine, sable, marten and beaver – from Russia and the Baltic lands, along with potash; and, from Italy, spices, medicinal plants, silk, satin, velvet, cloth of gold, oriental carpets, pottery, glass, tapestries, jewellery, monkeys, marmosets, ostrich, linens, felt hats, and leather.
In return, the English produced and sold wool, for in the long centuries of peace, cloth production boomed in Italy and the Low Countries. But Europe's spinners lacked sheep. So wool had to come from Burgundy, from the Spanish hills – and from England, where it was bought and sold at the fairs of Champagne and, in time, Bruges. Indeed, by the late thirteenth century, Flemish cloth-makers were so dependent on English wool that if supplies were stopped Flemish weavers starved. A giant opportunity so emerged. And of the English medieval entrepreneurs who built their fortunes in 'fleece and finance', none was greater than William de la Pole, the Hull-born commoner who became known, within a generation of his death, as 'second to no English merchant'.
* * *
William de la Pole was born in about 1290, 170 miles south of the frontier with Scotland. He lived his childhood amid the ferocious – and ferociously expensive – border wars of the last years of King Edward I's rule. His early life is shrouded in mystery. According to his son, most of the family's business records – 'their charters and muniments' – were 'burnt by the insurgents' in 'the late insurrection', the Peasants' Revolt of 1381. But we know that Pole was one of at least three children, along with elder brother Richard and younger brother John. And like Chaucer, they were the sons of a reasonably successful wine merchant.
William's hometown was Hull. Once a tiny port on England's Holderness peninsula, sheltering a few Viking ships huddled in the mouth of the Humber, it grew as a 'new town', developed by entrepreneurial monks of the nearby Abbey of Meaux, who were keen to cash in on the continental wool trade. They were so successful that Edward I bought the town, developed the port, and rechristened the place Kingston upon Hull. It became so prosperous that in the tax of 1203, Hull was the Crown's sixth biggest money-maker. By the time Pole was born it was a busy harbour, and in 1275 it is recorded as shipping some sixty-seven cargoes. In came a wide variety of goods: stockfish, eels, sturgeon and white herrings; timber, oil, iron, litmus, pitch tar and ashes; corn and beer; wax and candlewick; furs, purses and thread; copper, gunpowder and grindstones; boards, bowls and barrels; weaponry in the shape of lances, bow-staves and arrow-shafts, but most important of all, wine, imported from the Crown's lands in Gascony to supply the nearby Archbishop of York and the royal armies stationed nearby, standing ready for war with Scotland.
Wine was an enormous business. Nothing else was as important to the medieval diet other than grain and fish, and while it was not a drink for all classes, men above the lowest stations were drinking plenty of it by the fourteenth century. Indeed, by 1415, Britain was importing 4 million gallons of wine a year largely from Bordeaux.
Hull enjoyed a huge share of the business, and as Gascon wine came in, wool went out. Indeed, by the time Pole was born, Hull's wool shipments were second only to those of Boston, in Lincolnshire, and London. As Pole grew up, the wealth of his town multiplied. Watermills, brickyards, markets, quays, a mint, an exchange, a gaol and a gallows were built, as the borough became the king's chief supply port in the interminable border wars with Scotland.
According to the chronicler Thomas Burton, the Cistercian abbot at Meaux, Pole served his apprenticeship locally. 'Sir William de la Pole was first a merchant,' he wrote, 'and was instructed in the knowledge of trade at Ravensrodd.' His apprentice master was probably John Rottenherring, a wealthy and well-connected man who made his money in shipping and later became the first merchant appointed as the King's Warden.
William de la Pole appears in public records while he was still in his twenties, along with his elder brother, Richard. Already a burgess, Richard was dealing in corn, victuals, and – from 1317 – buying wine for Edward II as a deputy of the king's butler. By the age of thirty, William was already sharing property in Hull Street with some of the most substantial men in town, holding the sort of civic and royal posts filled by senior men, lending money – and buying large quantities of wine, occasionally it seems with a bit of sharp practice, delaying payments on wine bought for the king, and, worse, buying more than was needed for the king and re-selling the product for profit.
Ensconced in the royal bureaucracy, the two Pole brothers were soon rich enough to acquire John Rottenherring's house for the sizeable rent of £4 a year, and on 18 January 1321 Richard was rewarded with the key role of Collector of Customs at Hull, assessing cargoes, handling import-and-export payments and delivering cash to the Exchequer, a position that brought with it the privilege of deciding when to pay his own dues. With the cash-flow that came with it, it seems the brothers moved fast to enlarge their money-lending enterprises – and took aim at breaking into England's pre-eminent industry.
* * *
By the 1320s, the English wool business was centuries old. The Romans had known England primarily as a great mine of minerals such as tin, lead and silver – and a market of slaves. But in the centuries after the Roman evacuation of Britannia, the cloth trade grew. From the eighth century, the most active traders with England were probably the Frisians of the northern Germanic coast, who bought and sold wine, timber, grain and fish from towns like London and York and, from at least the late seventh century, traded a certain amount of English cloth, known, appropriately, as Frisian. A famous late eighth-century letter from Charlemagne to King Offa of Mercia complains about the short length and quality of cloaks supplied: 'What's the use of these little bits of cloth?' wrote the irritated Emperor, 'I can't cover myself up with them when I'm in bed. When I'm riding, I can't protect myself against wind and rain. When I have to go and answer a call of nature, I suffer because my legs are frozen!'
By the time of the Norman Conquest in 1066, England's sheep flocks already numbered 3 or 4 million, and they multiplied exponentially in the centuries that followed. By early 1200, England boasted at least 6 million sheep, and the chronicler Henry of Huntingdon could describe 'most precious wool' as foremost among the nation's treasures. By the middle of the thirteenth century, flocks may have tripled to as much as 18 million, and by 1297 England's barons declared wool, 'the sovereign merchandise and jewel of this England'. It made up perhaps half of the nation's wealth.
In the years before William de la Pole was born, perhaps one-third of the wool trade was in the hands of just 450 English merchants – men such as Nicholas of Ludlow, reputedly the richest merchant of his day, or William Grevel, described as 'the flower of all merchants of all England'. Wander through the graveyards of England's exquisite Cotswold churches and you get a sense of just how much was made by so many of the country's medieval wool-men, now memorialized in their stone and brass effigies, their feet resting on little carved sheep in the naves and churchyards of Oxfordshire. A motto for many is inscribed on one memorial window: 'I praise God and ever shall, it is the sheep hath paid for all.'
In the early fourteenth century, a young Italian banker, Francisco Balducci Pegolotti, left us a guide as to how the business worked. In his handbook, the Pratica della mercatora, Pegolotti set down everything he knew about sheep, now bred out of history. In all, the nation's sheep produced some fifty-one grades of wool. The sheep of the Welsh and Scottish borders, Yorkshire moors and chalk downs produced short wool used to make a heavier cloth, the most famous of which was the Ryland, named after the land between the Severn and the Welsh Marches. Larger sheep produced a longer wool, prepared by combing, and used for serges. Happily for the English, they could demand a very high monopoly price on the international market. The country could sustain only so many sheep, and with no alternative sources of high-quality wool available, merchants could make profits of up to £2 per sack on an investment ranging between £8 and £10.
There were no greater growers than the monks, lodged in some 650 abbeys and monasteries all over the country, and the business of the biggest was gigantic. By 1259, the Bishop of Winchester owned 30,000 sheep on a giant ranch-like estate, while the three great monastic houses at Tintern Abbey, Abeydoray and Stanfield in Lindsey, could boast wool that sold for 28 marks a sack: four times the value of the worst.
In total numbers, however, the flocks of peasant farmers may have been even greater – the 1 million small tenants and leaseholders who often paid their rent partly or entirely in wool. In the late 1200s, for instance, the residents of one small Oxfordshire hamlet owned 500 sheep, while near Merton, south-west of London, a body of 200 villages managed a flock of over 3,700 sheep. The sheep were so ubiquitous that in 1297, the country's barons could complain that 'the whole community feels itself burdened by the tax on wools'.
Nurturing the burgeoning flocks was the great English shepherd, equipped with candles to light the sheep house through the night in the lambing season, with pails of milk warmed in great earthenware pots for the new-born, frenetically rounding up, washing and clipping his flock in the annual sheep-shearing festivals immortalized by Shakespeare in The Winter's Tale. Once collected, the wool was packed in the county of origin, checked by the king's agents and dispatched in great bails, on packhorses, for the ports, where it was checked and customs were paid – along with tips to the officials, wine for the clerks, and money for the porters – before shipping to Calais. Often, the merchant sailed with the goods and lodged in Calais, which meant more bills from innkeepers, before meeting and selling the wool to the dealers of Flanders, Genoa and Venice, or riding on to the great fairs of Antwerp, Bruges and elsewhere. The trip might take several months – assuming piracy, bad weather, or the vicissitudes of local politics did not intervene.
Excerpted from Dragons by Liam Byrne. Copyright © 2016 Liam Byrne. Excerpted by permission of Head of Zeus Ltd.
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Table of Contents
A Note on Modern Monetary Equivalents xi
1 The nation's foundations 1
2 Robert Rich 43
3 Sir Thomas 'Diamond' Pitt 87
4 Matthew Boulton 133
5 Nathan Rothschild 173
6 William Jardine 213
7 George Hudson 253
8 George Cadbury 291
9 Cecil Rhodes 333
10 William Lever 375
11 John Spedan Lewis 417
List of Illustrations 511