Full podcast here: Founders #254 John D. Rockefeller: The Founding Father of the Rockefellers
He transmitted messages in code and secrecy covered all of his operations.
Rockefeller compared himself to Napoleon.
He could think quicker and along more individual and original lines than any of them.
It is always hard to successfully control what you don't understand.
By the time I was a man — long before it —I had learned the underlying principles of business and the rules of business as well as many men acquire them by the time they are 40. I needed no one to advise me about the nature of transactions with which I had been carrying on since childhood.
A veteran of long-distance provider MCI, Price came to Amazon in 1999. He blundered early by suggesting in a meeting that Amazon executives who traveled frequently should be permitted to fly business-class.
“You would have thought I was trying to stop the Earth from tilting on its axis,” Price says, recalling that moment with horror years later.
“Jeff slammed his hand on the table and said, ‘That is not how an owner thinks! That’s the dumbest idea I’ve ever heard.’ — Founders #179 The Everything Store: Jeff Bezos and the Age of Amazon
He saw that posted rates, supposedly fixed, could also be negotiated. All was not as it seemed on the outside.
He was the greatest borrower I ever saw.
What if the president of a bank refused to make me a loan? That was nothing. That made no difference to me; simply meant that I must look elsewhere until I got what I wanted.
Small egos don’t build giant companies.
Other refiners groused about these restrictions, but in general they accepted them as facts to live with. Rockefeller refused to do so.
Rockefeller’s plan at the beginning of his career:
1. You raise money so you can increase production.
2. Use your increased production to get better rates on transportation than other refiners.
3. Use your increased profits —because you have better transportation —to buy your competitors.
4. You continue to find secret sources of income.
It was ruthless efficiency and hyper competence.
Rockefeller loves secret allies.
The secret ownership of other companies was so well preserved that often a refiner enraged by Standard’s ruthless tactics would refuse its offer to buy him out and sell instead to a local competitor—unaware that he had in fact sold out to Standard.
He believed that Standard Oil stock is the most valuable thing in the world to own and always bought more of it.
Check out how Rockefeller turns an expense into a profit center:
Standard purchased a half interest in Chess, Carley & Company, the largest distributor of refined oil to the South and Southwest.
Together they purchased a number of the newly introduced bulk tank cars.
Chess-Carley shipped turpentine from southern pine forests to Cleveland, where the cars were emptied and the turpentine was sold in the local market.
The tank cars were then filled with kerosene and sent back to Louisville for distribution. In a single swoop the huge expense of shipment by barrels had been eliminated.
He proceeded in the same steady, methodical way that a farmer plowed a field.
Rockefeller on buying out his competitors and turning them into partners:
I think it is fair to say that the strong men who were competitors in the oil refining business, the aggressive men in the best financial condition, and the most intelligent, indeed the class of men who would be most likely to survive in the competitive struggle, were the men who were most likely to take up our idea of cooperation.
Jay Gould was the single most unsettling force ever to appear on the American industrial scene. Among wheelers and dealers of his day Gould had no peer.
Full podcast here: Founders #254 John D. Rockefeller: The Founding Father of the Rockefellers