To be a formidable businessman, one either has to be an inventor or have an eye for an invention that can transform the market. Put these together and you make a Fortune 500 Company. General Electric (GE) now ranks 11 among the Fortune 500 companies, a prestige that has left in its wake a rich history of ambition, greed, astuteness, and the industrial hunger of two great men – Thomas Alva Edison, the inventor, and JP Morgan, the investor.
Morgan’s business competency has never been in the shadows. His eagerness to make a name for himself, separate from the empire his father built has left a trail of some of the most successful business endeavours. There isn’t a soul now that doesn’t know the name of this business tycoon. Edison, on the other hand, was a prolific inventor no doubt, but this ingenuity was complemented by a business mind-set that was lesser known but no less intimidating as it had the power to trample anything that came in its way.
The crafting of an industrialist mind
Edison was a child prodigy who built his own laboratory at the age of 10. Even at that age, he knew how to use a situation to his advantage, a trait that he would later use in his ugly battles with his rivals. When his father bribed him to clear the lab from the basement with money to buy a book, Edison did so but also used that money to buy more chemicals for the infamous lab.
This potential for a smart businessman was crafted almost to precision when, at the age of 22, his telegraphic vote recording machine turned out to be a failure. The invention failed to impress as it was slow in recording the votes which allowed legislature members to tamper with them. It was deemed as the one invention that would never be needed on Earth, and so, was never used. Edison then learned his biggest lesson: an invention would survive only if there was a market for it. The patent he received for this devise was the first among many that came, but it set the motion for Edison’s style of invention. The inventions he described for most of his patents then on were improvements and innovations on prior inventions.
A testament to Edison’s industrialist mind-set is the Menlo Park laboratory, a novel attempt at the large scale mass production of inventions. Until then, invention was a solitary affair, but Edison, driven by his ambitions, completely transformed that trend. It was here that the electric light bulb, through the contributions of many notable scientists working for him, took the form of an affordable alternative to gaslight. And it was this innovation that caught the eye of JP Morgan.
The commotion that culminated in General Electric
Morgan went against his father’s ways and wishes when he invested heavily in Edison’s experiments with electricity. It was an unproven industry that carried with it an immense risk of failure. But to Morgan’s satisfaction and Edison’s exhilaration, the investment fuelled great industrial momentum. Morgan’s house became the first private residence to be lit with electricity. The duo then, under an industrial name of Edison Electric Illuminating Company, transformed a building in lower Manhattan into the world’s first central power station. Soon, their ambition translated into power that illuminated half of Manhattan.
This success was enjoyed for almost a decade till a humble acquaintance of Edison suggested an alternative to Direct Current. When Nikola Tesla asked Edison to look at his AC design, Edison, in his dismissal of it, created an unfortunate rival with his own hands. Tesla, who revered Edison, soon resigned and began looking for investors of his own. Blinded by the pride of his own invention, Edison made a blunder that sealed the fate of his tryst with electricity – he had failed to notice a potential rival. He convinced Morgan that there was nothing to worry about as he truly believed that AC current was unsafe and could never be accepted.
It was only when Tesla began doing everything in his power to prove the efficiency of it that Edison, through the pressure that Morgan was now impressing on him, took serious measures to thwart this rival. It was a desperate time that called for a desperate measure because Edison went as far as using Tesla’s AC current in criminal executions by electric chairs to prove its hazard. This, however, backfired. The first execution was too gruesome for the public to digest and all they could now connect with this grisly affair was one name – Edison.
Edison’s desperate moves stained his reputation along with that of Morgan’s. Morgan was haunted by his father’s words that had predicted this failure. But like a light in a dark tunnel, an opportunity came by that was for Morgan, the final chance to build his dream empire. A company at Niagara Falls was building the world’s largest power plant but hadn’t yet decided if Edison’s DC or Tesla’s AC current would be its star. A fierce bid took place at the end of which, to Morgan’s dismay, Tesla’s investor came out victorious.
Edison, who had still retained some zeal through the debacle, suggested they move onto other inventions and products; he had the motion picture camera in mind. But Morgan had already set his plan in motion. He still believed there was immense potential in the business of electricity but realised his only chance of tapping into it was cutting the baggage that was Edison. So, he bought a majority of shares in the company, fired Edison, and created General Electric.
Edison here showed perseverance that marks a true inventor; he moved on from electricity, without leaving on himself even a trace of his association with it. Possibly the very audacity and pride that marked a downfall fuelled a doggedness. In his career of innovation, he acquired over a thousand patents in America alone. However dodgy his decisions and actions might have been, Edison was a mind that sought opportunities, making him a businessman of unmistakable shrewdness.