Steamboats: A Start of Fortune

I became a married man at the age of 18 years old and started having a family.  I’ve told you about my early life experience out on sea.  By the 1860s I was the largest employer in America and was very wealthy.  I had already paid back my parents the $100 I used to buy my first ferry boats.  I was able to give my parents $1,000 from my first year’s profits for investing in me.  After the war of 1812, I started expanding my business all the way to Charleston, South Carolina.  But eventually steamboats were invented and popularly used.  Steamboats were faster, cheaper, and more efficient.  In 1818 I sold all my sailboats and partnered up with Thomas Gibbon.  Gibbons ran a ferrying business between New Brunswick, New Jersey and New York City.  I became a steamboat captain and between 1818 and 1829, we became the dominant ferry service from Philadelphia to New York City.  I charged $1 while others charged $4. I made up the loss by selling food and beverages on the boat bar.  In 1824, Gibbons was sued by Aaron Odgen, a New Jersey steamboat operator.  Odgen had bought a license from the monopoly and filed a complaint asking that Gibbons not be allowed to ferry on the monopoly’s waters.  Although Odgen won in the court of New York, Gibbons appealed to the Supreme Court saying that the monopoly was abusing powers that were unconstitutional.  Gibbons won this case and the Supreme Court ruled that the power to regulate interstate commerce was granted to Congress by the Commerce Clause of the United States Constitution.  After Gibbons won the case and the monopoly disappeared, ferry prices dropped, fuel was used instead of wood, and more people entered into the carrying business.  My partner and I had to quickly adjust our prices and switch to fuel to remain highly competitive.  In 1829, I had saved $30,000 and started my own business and became independent.  I soon got great numbers of customers.  I used the same tactic of giving cheap, reliable service.  I started out with a service between New York City and Peekskill Hudson River.  I still remained competitive even though I had cut my prices down to $0.  I made up for losses with the steamboats expensive bar.  I stole so many customers that the Hudson River Steamboat Association paid me to move from Hudson River.  They proposed to give me $100,000 and $5,000 annually.  I expanded my services to Albany, Long Island Sound, and Connecticut.  I made success still the same even without Hudson River.  By the mid 1840s my business was worth several million dollars and I owned over 100 steamboats.  Besides working hard, having great customers, and having low rates, I was frugal in how I operated and strategized my business.