The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1902-07-27
GATES TELLS
HON RE NON
Started as a Travelling Man
on a Small Salary
HIS FIRST BIG DEAL
1t Was in the Manufacture of
Barb Wire and Succeeded.
HIS FIRST BIG DEAL


secret of the birth of the United States
Steel corporation. He asserts that he is
the real father Of the billion dollar steel
trust. He declares that he not only con-
ceived the gigantic project, but laid down
the plans which J. Pierpont Morgan car
zied out.
These surprising statements are made IN
q five column interview published IN the
Commercial Advertiser. In this interview
Mr.. Gates gives a complete and detailed
account of his business career from the
time he started selling Darbed wire on a
salary Of 800 q month. He goes into all
his big business deals since then showing
each step in his rise and revealing his
profits with amazing frankness. The sto-
~ is told without bombast, and it is Won
nerfully interesting.
This is his account Of how he originated
Ehe great steel trust:
sIn talking with James J. Hi one even
ing IN January, 1901, he Informed me that
7. ?. Morgan was very much disturbed
over the iron and steel situation. The
Carnegie Steel Company was threatening
70 build a large steel tube plant and be-
come a competitor of the National Tube
Company, in which Mr.. Morgan was
largely interested and instrumental as a
banker in bringing out.
after several hours talk with Mr.. Hill
] told him that, in my opinion, there was
but ore way to manage the steel business
Of the United States. and that was ny an
actual consolidation, and that if Mr. Nor
gan would go to work at it right all the
iron and steel companies in the United
States could be brought into one COM
pany-
Next day Mr.. Morgan teiephoned me
and asked me to come down TO the bank
snd explain what I had said to Mr.. Hill.
I did so, and outlined to Mr.. Morgan d
plan for the formation OF what after
ward was named the United States Steel
Corporation
y told him about the lines and general
terms 7 thought would have to be adopted
TO obtain the Carnegie Steel Company,
which being the largest and most agrees
sive steel works in the world. was the
bone of contention among all the iron
and steel manufacturers. I assured him
that there was but one way to accomplish
the consolidation, and that was by getting
AIR. Schwab, with whom I was very we'll
acquainted and with whom I had talked
about the matter many times. 20 agree to
a plan in advance and submit that plan
to Mr.. Carnegie and get his approval.
and then so ahead and consummate the
consolidation.
Mr.. Morgan requested me TO see Mr..
schwab and arrange a meeting at his res
idence. This / did having first posted
Mr.. Morgan regarding my former talk
with Mr.. Schwab on the subject. We
finally mapped out a plan. after several
hours talk, that Mr.. Schwab thought Mr..
Carnegie would agree 10. and that I
strongly recommended.
after many conferences with the vari-
Gus concerns that now form the United
States Steel Corporation the basis was
made and all these properties put to-
gether"
Mr.. Gates story Of how he rose from a
travelling salesman TO be a millionaire and
one Of the greatest financial powers in
America is as follows:
Elwood. ] erected the first corral IN the
state Of Texas, hiring men to help me put
1t up 20 show the rangers what use could
be made OF barbed wire.
II had not travelled very long when I
came TO the conclusion that there was
more money in the manufacture Of barbed
wire than there was in selling it at A
salary of Sl0o a month / had a friend in
St Louis was living in Chicago at the
timely the name of Alfred Clifford Mr..
Clifford and I started in to manufacture
barbed wire in a small way. I think we
had three barhed wire machines our
total investment was less than $500 10
start with.
The business proved very profitable
and we shortly increased II. not IN the
same factory, but in an independent fac
tory We started an unincorporated con-
Cern under the name of J. ". Gates &
Co, into which eight eff US put each s.. 500
AL OF these gentlemen are still alive.
We declared dividends of about so Per
cent per week. / would travel and sell
The wire, come back. invoice il. bin IT,
paint St. market It and collect the money
Travelled Tor about two years. our
profits for the first year were $50. 900.
As ] was doing most OF the work ]
suggested 10 six of my partners that they
make give-or-take offer. They refused
but asked me TO make the OFFER. They ae-
cepted my ofrer and sold leaving no one
with me but CuGord. Then. in 1850. We
Incorporated the Southern Wire Company
with capital stock OF 5000 OF which
was the owner OF 4S per cent. Mr.. ClInorG
- per cent and Ar. Rowe per cent
Fronts for the next year were NSS.o go
"Oue Of the parties Of the Big Eight
Mr.. Edenborn. went into opposition 70 Us
At the end of three years oar plant was
destroyed by ire. The morning after The
loss I called up Nr Eaenborn and sug
gested that ne meet me and Mr. CunorC
and see II we could not agree upon q con.
s0lidstion. He did. and after ",
had reached an agreement. so that y,
erected the new works out where h,
Edenborn plant was located
Then We concluded 20 build nlin nea,
Pittsburg- and selected Rankin as n,
site. In les8 We began the erection o.
what is now known As The Braddock min
We started IA 10 build mill that woul,
rost US SllouoA We concluded than ",
would incorporate for Sl01ao3 aad borrow
the $1,000 Before We had completed Ia
mil s25J.ea had been expended. ard vi
were obliged 10 borrow Sl5a9 AZ. CIf
ford Mr. Edenboru and myself alvayi
went on the notes OF The company 5olntll