20 Tiny Investments From History That Grew Into Massive Fortunes

In May of 1626, Peter Minuit, the director-general for the Dutch West India Company in New Netherland, purchased Manhattan Island from local Native Americans, probably the Lenape or Canarsee, exchanging what are traditionally described as iron kettles, axes, knives, cloth, and beads worth 60 Dutch guilders (estimated by one 19th-century historian to be equivalent to $24). It is thought that the natives did not consider the transaction a sale of the island, but a sharing of resources. From that small settlement of New Amsterdam, the nucleus of New York City was born.

When Ford Motor Company was starting out, schoolteacher Rosetta Couzens loaned her brother James $100 from her personal savings so he could finish buying into the new car company. The $100 secured one share of Ford stock in her name and, over time, produced handsome dividends. When Henry Ford eventually bought out minority shareholders, he handed Rosetta a check for $262,036.67 for that one share. She saved every penny.

In 1886, John Pemberton, an Atlanta pharmacist, invented Coca-Cola as a headache remedy. But he was sick himself and began selling off his stake. It took a few years to assemble enough shares from Pemberton and his partners, but by 1891, Asa Candler, a prosperous Atlanta druggist, owned the whole business for around $2,300. He made Coca-Cola a nationwide brand through bottlers and billboards. Decades later, a syndicate of investors paid $25 million for Candler’s creation.

In March 1867, U.S. Secretary of State William Seward concluded a treaty to purchase Alaska from Russian Tsar Alexander II. The U.S. paid $7.2 million, or 2 cents per acre, for approximately 375 million acres. Russia wanted to sell the land because it had become a costly liability to defend after the Crimean War. American newspapers ridiculed the transaction as “Seward’s Folly” and “Seward’s Icebox,” but decades later, the discovery of Klondike gold, plus the revenue from fisheries and oil, repaid the original purchase price several times over.

Cornelius Vanderbilt began as a boy from a Staten Island farm seeking a way to make money in the freighting trade around New York Harbor. His mother, Phoebe Vanderbilt, agreed to loan him $100 for a small sailing vessel, provided that he first broke and planted a patch of rocky land. The young ferryman got his Staten Island-Manhattan route running, repaid the debt with interest within a year, and pocketed a nice profit. He then went into steamboats and later, railroads. When he died many years later, his fortune exceeded $100 million.

After serving in the First World War, Conrad Hilton traveled to Cisco, Texas, where he hoped to buy a bank with $5,000. The owner raised the price of the bank, so Hilton checked into the Mobley Hotel instead. He found it fully booked by oil workers who were required to take their rest in turns. Hilton purchased the hotel for $40,000, mostly through debt. After adding additional rooms and newsstands, he recouped the cost within a year. This property became the first in what would grow into Hilton Hotels.

John D. Rockefeller, originally a young merchant in Cleveland, reasoned that oil refining was more stable than wildcat drilling. Rockefeller and his partner, Maurice Clark, invested $4,000 to build a refinery with chemist Samuel Andrews. After a falling out, Rockefeller bought out Clark’s share at an auction to take full control. He later founded Standard Oil, which would come to refine most of America’s oil and make Rockefeller the nation’s first documented billionaire.

Thomas Edison, then living in New York City, developed an improved stock ticker he named the Universal Stock Printer. Marshall Lefferts, president of the Gold and Stock Telegraph Company, brought Edison in to negotiate the sale of the patent. Edison later said he had expected only a few thousand dollars, so he kept quiet about a price. When Lefferts offered $40,000, Edison took the deal. With that money, Edison opened a manufacturing shop in Newark, New Jersey, which was the first step toward his famous Menlo Park laboratory.

By the time William Wrigley Jr. was 29 years old, he had moved to Chicago with only $32 to his name to try to sell his father’s soap. His method of distributing the soap involved giving stores free baking powder as an incentive. He soon began selling the baking powder itself, and tossed in free chewing gum as a bonus to get stores to order it. Store owners began ordering just to receive the gum. Wrigley quit the soap and baking powder business, began making his own gum, and shortly thereafter launched Juicy Fruit and Wrigley’s Spearmint.

Andrew Carnegie began his career as a telegraph operator for the Pennsylvania Railroad under superintendent Thomas Scott. Carnegie had the opportunity to purchase ten shares of Adams Express stock for $500 from Scott, but he lacked the funds. His mother, Margaret Carnegie, paid the cost of his ten shares by taking a mortgage against the family home in Allegheny, Pennsylvania. Receiving the first dividend made Carnegie realize how money could make money. He then set his sights on more lucrative investments that would ultimately lead to Carnegie Steel and its eventual sale for $480 million.

While having dinner at the Baker Hotel in Dallas, H.L. Hunt ran across a wildcatter named “Dad” Joiner, who had discovered the enormous East Texas Oil Field but was tied up in litigation due to conflicting leases. Hunt bought Joiner’s discovery well and leased the surrounding acres for $1.335 million. The only cash he put down was $30,000, which he borrowed from a friend, and covered the balance with future royalties on the oil. Within 20 years, that field made Hunt the richest American.

Frank Woolworth was a store clerk until his first 5-cent store in Utica, New York, went under. He convinced his former employer, William Moore, to give him $300 in merchandise on credit. He used the merchandise to start another store in Lancaster, Pennsylvania. He added 10-cent merchandise and had open counters so customers didn’t have to ask a clerk to get what they wanted. It worked. Lancaster was a success, he paid off the credit, and it became a chain across America. Years later, Woolworth spent $13.5 million in cash to buy the Woolworth Building in New York.

Thomas Jefferson sent James Monroe and Robert Livingston to Paris to purchase the port city of New Orleans. But Napoleon Bonaparte, emperor of France, was engaged in a ruinous war with Great Britain and had also failed to crush the rebellion in Haiti. Instead, he offered to sell them all of French Louisiana. Monroe and Livingston exceeded their instructions, agreeing to pay $15 million for some 828,000 square miles of territory, or about 3 cents an acre. In doing so, they doubled the size of the United States.

In 1886, a 22-year-old named Richard Sears was working as a railway station agent in Redwood Falls, Minnesota, when he learned that a local jeweler had refused a delivery of gold-filled watches coming in from Chicago. He bought the whole batch for $50, and resold them to fellow railway station agents at a discount, making over $500. Sears quit his railroad job to go into the watch business and soon hired a repairman, Alvah Roebuck. Together, they founded Sears, Roebuck and Company.

A.P. Giannini was a fruit merchant in San Francisco who grew tired of banks refusing to loan money to poor Italian laborers, so he pooled money from neighborhood investors to open the Bank of Italy in the back of a former saloon. During the Great San Francisco Earthquake, other bankers couldn’t access their vaults because of the heat. Giannini snuck the cash out beneath crates of produce, then sat at a desk on the wharf, offering loans based on a handshake alone to help the city rebuild. The Bank of Italy later became Bank of America.

Anthony Lucas, an Austrian-born mining engineer, leased acreage on Spindletop Hill near Beaumont, Texas, taking a chance on the self-taught Pattillo Higgins’ notion that oil was sitting beneath the surface, an idea local investors had ignored. When the first rig proved unsuccessful, Pittsburgh-based investors James Guffey, John Galey and Andrew Mellon stepped in to fund additional, heavier equipment. They found oil that flowed at 100,000 barrels a day. The Lucas Gusher gave rise to Gulf Oil and Texaco.

James Couzens, the brother of a schoolteacher named Rosetta Couzens, was a clerk for Alexander Malcomson, a Detroit coal merchant. To buy his shares in the newly formed Ford Motor Company, he put together $2,500, including the $100 he borrowed from her to purchase one share in her name. He made payment with some cash and a promissory note, paying off the debt with future dividends. He would serve as the business manager for Ford and help build its sales network before resigning years later. When Ford finally bought out his stock, he was rewarded with about $29.3 million.

Thomas Adams, an American inventor, worked for Antonio López de Santa Anna, the former president of Mexico, living in exile on Staten Island. Adams wanted to turn his plentiful supply of chicle, the dried sap of the sapodilla tree, into a low-cost version of synthetic rubber. After a year of failed experiments, Santa Anna gave up. Adams noticed that chicle had an elastic and water-resistant texture, and he invested $55 of his own money in a few simple tools. He began selling his “Adams New York Chewing Gum No. 1” in local drugstores. Eventually, he founded the American Chicle Company.

Julius Rosenwald operated a clothing business in Chicago that made men’s suits for Sears, Roebuck. When the company’s original co-founder, Alvah Roebuck, sold his share due to financial and emotional distress, Rosenwald and his brother-in-law, Aaron Nusbaum, purchased that share for $37,500 each, leaving them with a 25% stake in the company. Rosenwald set the bar for product quality and introduced a “satisfaction guaranteed or your money back” guarantee, which won the respect and loyalty of people from around the country. That initial $37,500 investment turned into a holding valued at more than $150 million.

Alexander Graham Bell was teaching deaf students in Boston when he was experimenting with a harmonic telegraph that could transmit multiple tones on one wire. Thomas Sanders, a leather merchant, and Gardiner Greene Hubbard, an attorney, had children who were students of Bell’s. They agreed to pay for Bell’s research and patent costs, and in exchange, they each received a one-third ownership stake in the company. That amounted to a few thousand dollars over a period of two years. Bell eventually transmitted the first voice message. The three men would go on to establish the Bell Telephone Company, which became the predecessor to AT&T.

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