Business and Industry
Cornelius Vanderbilt
1794-1877

Cornelius Vanderbilt was born at Port Richmond, Staten Island, New York, the son of a ferryman and farmer. He received little formal schooling. By age 16, he was transporting people and cargo around New York harbor. During the War of 1812, he secured a government contract to deliver supplies to posts throughout the area.

Vanderbilt eventually controlled most of the ferry traffic in New York waters, but in 1818 he sold his fleet and went to work for a steamship line run by Thomas Gibbons. The Gibbons line was highly successful by effectively undercutting the earlier line established by Robert Fulton and Robert Livingston. Litigation involving this rivalry was eventually settled in the landmark Supreme Court case, Gibbons v. Ogden (1824). Vanderbilt stayed with Gibbons until 1829 when, having learned all he could and accumulated sufficient savings, he left to establish his own line.

One of his first victories was won in a price war against Daniel Drew, who was forced to withdraw from the business. During the 1830s, Vanderbilt's line became the dominant steamship presence on the Hudson River, due largely to low pricing and comfortable accommodations. Eventually, his competitors banded together and bought him out.

Vanderbilt turned to serving Long Island and Boston. Never the retiring sort, he adopted the title “Commodore” and frequently dressed in a full naval uniform.

Seizing upon the gold rush fever of 1849, Vanderbilt established a cheap, reliable way for prospectors to reach the gold fields of California. In 1851, he arranged ship accommodations from New Orleans to Central America, overland travel across the isthmus, and another ship for the voyage up the Pacific to San Francisco. Vanderbilt’s venture was so successful that his competitor bought him out and paid him $50,000 a month for not operating his business.

In 1855, Vanderbilt opted for the luxury liner business and for a few years operated a line between New York and Havre, France.

Vanderbilt entered the railroad business in 1857 and eventually gained control of the New York and Harlem Railroad—again besting his rival, Daniel Drew. However, Drew and his associates James Fisk and Jay Gould thwarted Vanderbilt’s efforts to gain control of the Erie Railroad in the “Erie War” of 1867-68. Despite this setback, Vanderbilt managed to expand his empire through purchase and consolidation. He gained control of the New York Central in 1869. By 1873, he successfully linked New York to Chicago by rail.

During the Panic of 1873 and the resulting depression, Vanderbilt began construction of Grand Central Terminal in New York City, offering employment to thousands who otherwise would have been unemployed. The New York Central was one of the few railroads that posted profits during the depression.

Vanderbilt was never a great philanthropist, but he did bequeth $1 million to Central University in Nashville, Tennessee, which became Vanderbilt University. The bulk of his $100 million fortune was left to his son, William.

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