Timeline
- 1839
- Born in Richford, New York.
- 1855
- Started work at Hewitt & Tuttle.
- 1859
- Founded Rockefeller, Andrews, & Flagler.
- 1862
- Entered oil-refining business.
- 1869
- Rockefeller, Andrews, & Flagler became the Standard Oil Company of Ohio.
- 1882
- The Standard Oil businesses brought under the control of the Standard Oil Company.
- 1890
- Nationwide distribution system reached most towns in the US.
- 1892
- The Trust was dissolved by Ohio government, and reconstituted as Standard Oil Trust.
- 1900
- Standard Oil controlled more than three-quarters of the US petroleum industry.
- 1904
- Standard Oil delivery carts served 80% of US towns.
- 1911
- Resigned as president and Standard Oil Trust was dissolved.
- 1913
- Established Rockefeller Foundation.
- 1937
- Died in Ormond Beach, Florida.
Life and Career
John D. Rockefeller was an industrialist, the patriarch of America’s best-known family, and the world’s richest man of his time. After only a year at high school, and a short time at Folsom Mercantile College, he became an office boy and assistant bookkeeper at the firm of Hewitt & Tuttle. He stayed there for three years, before starting his own business. After this proved successful, he moved into the oil business, buying out most of the local competition, and setting his sights on building a national oil company with a national delivery network. He withdrew from active management of the company in 1897, remaining president until 1911, when the Standard Oil Trust was dissolved by the US government. His final years were devoted to philanthropy, giving away the bulk of his huge fortune through the Rockefeller Foundation.
Key Thinking
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John D. Rockefeller, the founder of the famously wealthy family dynasty, built up the most powerful oil business in the US, Standard Oil, which refined and marketed nearly 90% of the oil produced in the country.
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His development of Standard Oil to a near-monopolistic position in the US oil industry was part of the larger shift from small business operations to the rise of giant corporations.
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He was extremely successful in creating an empire, and becoming massively wealthy through buying up the competition, and focusing the company on business development and growth.
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His approach received much criticism. There were accusations about the use of unscrupulous tactics, collusion with the railroads, use of predatory pricing, monopolistic practices, and the bribery of political officials.
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The trust that he formed to run Standard Oil was attacked by President Roosevelt, who fought a personal battle against industry trusts in general, and Standard Oil in particular.
In Perspective
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John D. Rockefeller entered the oil industry just as oil was becoming central to the US economy and many refineries were being opened, and he was able to take advantage of the boom.
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Although there was were a large number of companies competing against each other, which forced down prices and made many of them bankrupt, Rockefeller merged his company with the Standard Oil Company of Ohio with US$1 million of capital, and became its president.
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He applied the “combination” strategy to the oil industry that legendary US banker J. P. Morgan had successfully applied to the steel industry––buying up competitors across the country, and spreading the risk inherent in the industry.
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By 1882, his success had enabled him to unite all the businesses of Standard Oil into the single organization of the Standard Oil Trust, which controlled the majority of the oil industry in the US.
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The predominance of the Trust brought criticism, and the Attorney General of Ohio successfully managed to dissolve it. However, it soon reformed as the Standard Oil Company (New Jersey), to take advantage of New Jersey’s less-stringent laws.
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In 1911, the US Supreme Court ordered the dissolution of the Standard Oil Company (New Jersey), asserting that it contravened the country’s antitrust laws, and all the parts of the business were split into separate entities.
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After his retirement, Rockefeller spent his time on philanthropic work. He donated more than US$35 million to the University of Chicago, founded the Rockefeller Institute for Medical Research, the Rockefeller Foundation, and the Rockefeller Sanitary Commission.
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At its height, Rockefeller’s wealth reached US$900 million, but he had given all but US$26,410,837 of it away by the time he died.
Quotation
“The way to make money is to buy when blood is running in the streets.”
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