Thread by @mr_thaddy

EP 5: How a Poor, Uneducated, Fatherless 4-year-old Kid Used $22 to Build a $12,000,000,000 Company: Rolls-Royce

Unfortunately, this interesting story didn’t have a happy ending, you may actually shed tears...

#techtwitter #MONEY #business #cars

Henry Royce was born in 1863 in England to a family of James and Mary Royce. His parents ran a flour mill business, which later went bankrupt after many years of struggling to keep it alive.

This strategy made them leave for the capital city of England, London, to search for

greener pastures.

By this time Henry Royce was just 4 years old, despite his young age he tried helping his parents out by getting a small job where he scared birds off the land of a farmer for 2 cents.

While he was doing that his father, James Royce went to work for a

flower mill but he was in so much debt from his company’s bankruptcy, that his mind and body couldn’t hold on any longer and when Henry was just 9 years old, his father died.

This was so sad for the family because their financial struggles will only be getting worse.

In a bid for Henry to help himself, he dropped out of primary school and went on to get a full-time job, selling newspapers and delivering telegrams for the post office.

This made him earn 3 cents for every delivery that he used to support himself.

Mary was still in debt from

the bankruptcy and knew full well that she does not have enough money to pay up the dept, so to prevent matters from becoming more unbearable by spending money to take care of her child.

She then decided to pass on the responsibility to an elderly couple to take care of him.

What makes that move less joyous was that the couple themselves were barely trying to survive.

This made Henry Royce's childhood a living hell, they were even days all he had to eat was a piece of bread soaked in milk and together with the excessive work he had to do to help

himself, they will all go a long way causing serious health complications for him in the future.

Years passed by and Henry finally got reunited with his aunt and she gave him some money to go back to school.

This was a very big opportunity for Henry as he used it to apply to

an apprenticeship programme with the Great Northern Railway company.

But his problems were not over yet as he had no money to rent a house. Later luck shun on him and a man called George Yarrow welcomed him to his home.

George Yarrow had a son who was also an apprentice in the

company and as someone who has served the company for years, he decided to seize the opportunity to mentor the 2 boys to make their learning curve easier.

While the man’s son saw it as work, Henry saw it as a hobby and during his spare time, he would go to the man’s backyard to

start playing with his tools.

He worked his way into being a very good engineer and after some months passed by, he learnt how to make brass wheelbarrows, which had the best build and style in his community.

But with this breakthrough things were not still getting better for

Henry as the money for the tuition fee at the company had just finished after 3 years. So he had no choice but to leave the programme.

Henry then applied to a tool-making company in Leads and by this time he was 17 years old. He got the job and started working and his pay was

2 cents per hour.

After some years passed by, he got tired of the job and moved to Liverpool where he got a job in an energy and light company. The pay was better than his previous job.

After Henry finished the programme, he went on to apply to the Maxim-Weston Electric Company

and he walked his way up to becoming the chief electrician.

To Henry, the future had started to look bright but only did he know that the company will be going bankrupt after some years, leaving him unemployed once again.

After it happened Henry became emotional,

he questioned himself saying “Why me? Am I the first person trying to be happy with life?”.

Henry Royce was very fed up and this time around he decided to start his own company, instead of working for other people.

He also knew that starting a new company was not something

that was going to be easy, so he asked some of his coworkers in the Maxim-Weston Electric Company to join him

But only Ernest Claremont, who was also skilled in engineering was willing to take the risk with him.

And after some years passed by, they finally registered a company

called F.H. Royce and Company in 1884.

The company finally started operation by making electric fittings

And in no time Henry and Ernest started to see that the future of the company was not looking bright because they had put in a very small amount of capital ($87) to fund it.

They were even times when all they could afford was a single meal a day. It wasn’t easy for them.

But if there is something that you should take home from the Rolls-Royce story is that when things are not working well in life, try to be the best version of yourself by working

very hard, so that in the long run your competition will not be able to compete with you in your own game.

That was the principle Henry applied and after experiencing so much hell in the company, Henry and Ernest finally came up with their first successful product, the electric

doorbell.

It sold very quickly and Henry and Ernest upped their production rate to meet the aggressive demand. They were also making new types of products every year.

As the business began to grow so was their net worth. At peak value, the company was valued at $37,000

(with respect to inflation it is equivalent to $1,200,000 today).

After Henry and Ernest finally became wealthy they gave the supervisory roles in the company to other people, while they went on to focus on their personal life.

Henry and Ernest were so close that they even

married a pair of sisters, Edith and Minnie Punt.

With money in the bank, Henry could now focus on more ambiguous projects and the industry that picked Henry’s mind was the automobile industry.

Henry later went on to purchase a French car that was made in 1901. When he started

testing the car he discovered that it had many faults, often time when he will be driving it the car will break down in the middle of the road and he will have to fix it.

Then he said to himself one day, “Why don’t I build the best car in the world, instead of fixing the French

car every time?” that was how Henry Royce entered the automobile business but what may surprise you more is that his first car was not called Rolls-Royce.

It will take teaming up with a car dealer known as Charles Rolls for the first Rolls-Royce car to be produced.

The final part (part 2) of the story is to be continued later.