On this day in economic and business history …
The frontier road to riches
John Jacob Astor established the American Fur Company on April 6, 1808. Astor was already a wealthy man from the fur trade, but it was through this company, and its later subsidiaries, that he became America’s wealthiest man, and its first multimillionaire.
Born in Germany in 1763, Astor emigrated to London at age 16. There, he learned English and learned of the vast frontiers of America, where intrepid men might make their fortunes. Astor traveled to America just after the close of the Revolutionary War, working with his brother at a butcher shop and in musical-instrument sales before settling on the fur trade as his path to glory.
The 1794 Jay Treaty between Britain and the United States opened new markets for Astor’s thriving fur business. Within a year he controlled a dozen ships. Five years later he was worth a quarter of a million dollars. The ill-advised Embargo Act from President Thomas Jefferson nearly undid Astor’s business, which was one of the motivating factors behind American Fur’s establishment after the embargo was terminated. The War of 1812 was another major setback, as Astor was forced to sell Fort Astoria (a settlement in present-day Oregon). As if to make up for its repeated obstruction, the American government barred foreign fur traders in 1817, which would provide Astor with the protection needed to monopolize America’s fur trade. By the 1830s he was out of the trade, a millionaire several times over.
Astor then turned his attention to real estate, particularly in the relatively underdeveloped New York City borough of Manhattan. His investments paid off handsomely as New York grew into the nation’s financial center, and by the time of his death, Astor was by far the wealthiest man in the United States. More than $20 million in assets were disbursed in his will, which has been estimated to be worth roughly $115 billion, when calculated against the gross national product of the time.
A window to domination
Microsoft Corporation (NASDAQ:MSFT) released Windows 3.1 on April 6, 1992. The first real Windows experience for millions of thirtysomethings (and older twentysomethings), 3.1 proved more stable than the version 3.0 it replaced and offered greater support for multimedia. This provided the first real impetus for game design on the operating system over simply designing for a DOS environment. Microsoft also took a page from the Apple Inc. (NASDAQ:AAPL) playbook by implementing TrueType fonts on 3.1, the first time it had made a genuine effort to appeal to the design-oriented user. Microsoft Corporation (NASDAQ:MSFT) actually licensed TrueType from Apple at no cost, which seems a bit odd to consider in light of the fact that Apple and Microsoft were in the process of wrapping up a contentious copyright-infringement lawsuit over similarities between Windows and the Macintosh operating system.
Windows 3.1 came bundled with most new computers sold at the time and effectively locked in millions of users by the time Windows 95 came out three years later. By this point, Microsoft Corporation (NASDAQ:MSFT) was already one of the hottest tech companies in a hot tech boom, but Windows 3.1 only lit a larger fire beneath it. From the time Windows 3.1 was released to the turn of the new millennium, Microsoft’s shares grew an incredible 2,200%, creating the most valuable company of all time.
Give them a little credit
The first credit union in the United States, St. Mary’s Cooperative Credit Union, was chartered by the New Hampshire legislature on April 6, 1909. A week later, the state of Massachusetts would pass the first statewide credit union law, paving the way for the eventual spread of credit unions across the country. Citizens of the United States at last had an alternative to the banks that had long held exclusive dominion over the country’s financial system.
Credit unions, which are nonprofit financial institutions, serve anyone willing to “invest” a nominal amount (typically a few dollars) to become a member. Marketed as “community-oriented” alternatives to big banks, credit unions have grown into a significant part of the American financial picture, particularly following the passage of the Federal Credit Union Act in 1934. In 2009, a century after St. Mary’s Cooperative (now simply St. Mary’s Bank) opened its doors, more than 7,500 federally insured credit unions assisted communities throughout the country. Despite the lingering economic weakness that year, these credit unions held more than $750 billion in assets — including roughly $575 billion in loans — producing an aggregate industrywide net worth of nearly $90 billion.
Make a note of this big opportunity
3M Co (NYSE:MMM) launched Post-It notes on April 6, 1980. The world-famous sticky-backed notes had a long, convoluted trip to commercial success. The first development on this path came in 1968, when researcher Spencer Silver developed a weak pressure-sensitive adhesive — acrylate copolymer microspheres — while trying to create something more suitable for bonding the joints on airplanes. The weak adhesive had no apparent use to 3M executives, and the new chemical was shelved until 1973, despite Silver’s hopeful touting of its as-yet-undiscovered value.
In 1973, 3M Co (NYSE:MMM) chemical engineer — and devout Christian — Art Fry had a serendipitous breakthrough that made something useful of the microsphere adhesive. Fry was frustrated that the markers in his choir books would always fall out when he was singing, and he realized that sticky-backed paper using the microsphere adhesive would be the perfect solution. Silver agreed to work on this new application with 3M’s Geoff Nicholson, who had considered adhesive bulletin boards as an alternative use. After further research and refinement, the Post-It was born — but it didn’t catch on with top brass right away.
From 1977 to 1980, Nicholson’s tireless advocacy helped push the company toward a national rollout, which finally happened, as you already know, on April 6, 1980. The Post-it became a monster success, and it remains one of the most popular office products in the world to this day. You might even have one within reach right now. Write “Happy Birthday, Post-It” on that pad if you have it, and thank the small group of true believers at 3M Co (NYSE:MMM) who brought it from the lab to within arm’s reach.
The article How Microsoft and 3M Justified Their Place on the Dow originally appeared on Fool.com.
Fool contributor Alex Planes holds no financial position in any company mentioned here. Add him on Google+ or follow him on Twitter, @TMFBiggles, for more insight into markets, history, and technology.The Motley Fool recommends 3M and Apple and owns shares of Apple and Microsoft.
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