America in Global Context: German Entrepreneurs around the World

Overview

Gilded Age and Progressive Era America and Imperial Germany were both heavily shaped by the forces of globalization. Recent scholarship has conclusively refuted earlier attempts to view American and German nation-building during this period as the result of domestic forces and debates. The state of both countries around 1900 is best understood within the context of their manifold cultural, economic, and political entanglements. These occurred on a bilateral basis, but also with other countries throughout the world in the form of migration, trade, intercultural transfer, and long-distance communication.[1] While the Immigrant Entrepreneurship project is an important step towards the transnationalization of American history, it could benefit from a momentary recalibration or expansion of its focus. Putting German entrepreneurial migration into a wider context helps break up the bilateral framework of the project and sheds light on the global implications of immigrant entrepreneurship. The United States was undoubtedly the most important, but by no means the only country of destination. German industrialists, merchants, and other entrepreneurs could be found in virtually all world regions where international trade or local markets promised satisfactory returns. They were globally dispersed manifestations – and motors – of Germany’s expanding economy between unification in 1871 and the First World War. The following global overview cannot claim to be comprehensive; still, it endeavors to introduce important German entrepreneurs who were active outside of Germany and the U.S., and to discuss particular regions where the German entrepreneurial presence had an impact on local economies. Research on German emigration has long focused predominantly on the United States, but the multitude of destinations reinforces the need to extend the geographical scope of investigation. This applies not only to overseas destinations, but also to intra-European movements, which are still under-researched.[2]

The global framework introduces a number of theoretical implications, not least regarding the nature of migratory movements and their impact on entrepreneurial activity. Mobility patterns often included circular, step, or re-migration, which created transnational networks along the way and pushed the dissemination of people, skills, and hardware in multiple directions. During the nineteenth century, this process was fostered by the emergence of a relatively integrated northern hemispheric labor market spanning Western Europe and North America. Both France and Britain, for example, hosted sizeable German minorities before 1914, and Canada remained a viable alternative to the United States throughout the nineteenth century. Dissemination was also fostered by the expansion of colonial markets. The economic integration of the British Empire, for example, was given a considerable push by the “import” of entire German merchant networks. All European overseas possessions attracted a mélange of European elites, calling into question the “national” character of colonial empires.[3] All of this was facilitated by steam and rail traffic, which made for quicker travel times into remote corners of the world. German-American movements should therefore be seen as a specific variant of a range of interlocking migration systems.

As will be shown, German entrepreneurs often fared well in very different environments. In Central America, for example, they played a role (together with British, French, North American, and other ethnic elites) in opening up respective economies to world markets by developing plantations and export networks. The French minister in Guatemala reported that “the German colony in Guatemala was numerous and due to [ . . . ] the prosperity they had acquired, their members occupied a preponderant place among the foreigners who came to seek fortune in Guatemala.”[4] When it comes to explaining the position of German entrepreneurs abroad, the global framework requires some theoretical adaptation. Rather than dealing with a single contact zone between two cultures, we are now dealing with a diverse range of receiving economies. This allows for a clearer focus on the sending context. In Germany, prospective migrants had been equipped with human capital in the form of structured training and with social capital in the form of pre-existing, transnational networks. This left them well equipped not just for the American labor market, but also for the challenges of globalization more generally. The connection between education, skill diffusion, and the relative success of Germans around the world has already been noted by Thomas Sowell,[5] and the present contribution refines this picture for the entrepreneurial sector.

We must also consider the advantage conveyed by a booming domestic economy with substantial product and capital flows into and out of Germany. By 1914, Germany was the third largest exporter of capital with around 31 billion marks of investment abroad. This figure is composed of portfolio investment on the one hand, most importantly infrastructure projects such as railroads, port facilities, or power plants in resource-rich countries. On the other hand, the figure includes about 11 billion marks of Foreign Direct Investment (FDI), whereby multinational companies set up branches or production plants abroad. German FDI in Britain, for example, comprised at least 179 ventures between 1871 and 1914, ranging from chemicals (e.g. Merck, Henkel, Beiersdorf), banking (e.g. Deutsche Bank, Dresdner Bank) and insurance (e.g. Allianz) to electrical equipment (e.g. AEG, Bosch), vehicles (e.g. Daimler) and foods (e.g. St. Pauli Brewery, Stollwerck).[6] Small ethnic communities consisting of specialists developed around these ventures. One example is Dalmine near Bergamo, Italy, where the Mannesmann Company set up a tube factory and established a German school for the children of German employees.[7] Expatriate employment triggered by foreign direct and portfolio investment should, however, be separated typologically from immigrant entrepreneurship as it was only temporary from the start and occurred within fixed employment arrangements.

By 1914, Germany had superseded France and Britain in terms of industrial production. Its share of the global GNP had risen to 8.7 percent (Britain 8.2, France 5.3, but the U.S. 18.9). At the same time, wages were still lower than in other Western European countries, which meant that production was relatively cheap. Within the international system of fixed exchange rates based on the gold standard, this contributed to competitive advantages in export. Germany’s export rates rose faster than those of world exports generally. Almost a quarter of domestic industrial production was exported, as opposed to fifteen percent for Britain and France respectively. Its share in world trade rose from 9.5 percent in 1874-78 to 12.2 percent in 1909-13 – which is broadly comparable to the figures for the United States – while the British (17.3 to 13.5) and French (11.7 to 7.5) shares declined steadily in the same period. The close integration of science and industry in Imperial Germany generated a quantum leap in high technology production, and as a result German products and know-how could be found in pertinent branches all over the world. These branches included engineering and machine-building, and the chemical and electrical industries, in particular, but also more specific areas such as optical instruments, beer brewing, or musical instrument manufacture. Most notably, the German electrical industry held forty-six percent of the world market in 1913, and virtually every light bulb used across the world hailed from Germany.[8] In the electrical and communications sector, Siemens & Halske represents a typical example of transnational activity tied together by family connections. A branch in London was established in 1858 by Werner von Siemens’ brother Wilhelm, who was joined there by another family member, Alexander, ten years later. The London branch made its name by constructing the first telegraph line between Britain and India in 1870, and in subsequent years by expanding telegraph connections between the United States and Britain (Direct United States Cable). Business grew to the extent that the branch was turned into an independent company, the Siemens Brothers & Company Limited (1881). Later, the company also added the Siemens Brothers Dynamo Works (1906), which focused on dynamo production. Migration turned Siemens into a global player, gave the company instant access to British imperial markets, and contributed in turn to the integration of that Empire, thereby acting per se as a motor of globalization. Other major Siemens projects included a telegraph network in the Russian Empire and the tram system in St. Petersburg. These were built by the local Russian branch of Siemens & Halske, which was managed by Werner’s brother Carl von Siemens, who also invested in a copper mining works in the Caucasus and a glass factory in Nowgorod.[9]

Entrepreneurs in Imperial Germany were particularly mobile. Seventy-two percent of businessmen from Dortmund, Bremen, and Frankfurt had spent a lengthy period of time abroad. Unsurprisingly, most had worked in the trade sector,[10] where they often trained in junior positions as clerks. Those who returned to Germany did so with greater mercantile and technical know-how, enhanced foreign language proficiency, and established business contacts that were often kept alive across time and space. All of this helped returnees achieve entrepreneurial success in their native land. During their stay abroad – which could range from short-term to indefinite – they also profited from their intercultural competence. As Sir Jacob Behrens, who had himself come to England from Germany and had become a leading textile producer in Bradford, explained: “The German clerk, who has a good knowledge of three or four languages, who has been taught to understand the working of the exchanges [and] the tariffs of different countries [ . . . ] will find employment and rise to an important position or to independence much sooner than the English clerk.”[11] Mercantile training was, indeed, comprehensive by international standards and not only included business know-how but also foreign languages. After trade colleges [Handelshochschulen] were established in Germany starting in 1898, students could extend their training up to the age of twenty-five.[12]

Underlying factors explaining the nature of expatriate entrepreneurial activity in late Imperial Germany therefore include high mobility into all world regions, accumulated human and social capital, extensive transnational networks, and an expanding home economy. A closer look at pertinent businesses, however, begs the question of how “German” these businesses actually were. To what extent were national labels appropriate in an age of economic globalization? And to what extent did these businesses fit into ideological constructions of German Weltpolitik and global presence? The following overview rather points to transnational agency and questions constructions of this sort.

Sector Case Studies: Chemistry and Beer Brewing

As two case studies, the chemistry and beer brewing sectors provide exemplary insights into patterns of entrepreneurial migration. They hark back to the theoretical implications outlined above, especially to the notion of pre-emigration skill acquisition as a stepping stone for success abroad, as well as to Germany’s international preeminence in both sectors. The German dye industry, for example, was particularly strong with a ninety-percent world market share in 1913. The chemical sector also underscores the significance of Britain as the most important European magnet for German entrepreneurs. Throughout the nineteenth century, Britain was a highly industrialized, high-wage economy with easy access to imperial and other overseas markets through well-established trading routes. For Walter Wetzel, “it is astonishing how many German emigrant scientists, mainly chemists, were to play a leading role in the economy as company founders, top managers or academics.”[13] This was true for those who remained in Britain permanently, as well as for those who returned at later stages. The latter include Carl Alexander Martius (founder of AGFA), Wilhelm Meister (co-founder of Hoechst), and Heinrich Caro (director of BASF).

German chemical research was internationally renowned from the 1840s onward, not least through Justus Liebig’s laboratory in Giessen. It also produced well-trained graduates in numbers that exceeded the demand in Germany. August Wilhelm Hofmann, known as the “Father of the British Dye Industry,” served as director of the newly established Royal College of Chemistry between 1845 and 1865 before returning to Berlin. Of those who remained in the chemical industry in Britain, two stand out: Ivan Levinstein (1845-1916) and Ludwig Mond (1839-1909). Both were Jews and would also have enjoyed greater freedom in Britain. Levinstein had studied in Berlin before moving to England at the age of nineteen. In 1865, he founded an anilin manufacturing firm near Manchester that, by the time of his death, had developed into the largest dye producer in Britain. In 1926, it was one of the four firms that merged into Imperial Chemical Industries (ICI). At the time, the ICI was the largest manufacturing conglomerate in the British Empire; it continued to do business under that name until 2008. Another of the four firms constituting the ICI was Brunner Mond. The company had been founded in 1874 by Ludwig Mond of Kassel in partnership with a Swiss immigrant, John Brunner, and it produced mainly alkali and soda. In 1881, the partnership became a limited company with assets of £600,000. Levinstein’s son Herbert and Mond’s son Alfred took over the respective firms and later played a leading role in the merger and directorship of the ICI in the 1920s. German chemical merchants settled in nineteenth-century Britain on the back of these developments. One example is Danzig-born Paul Rottenburg, who moved to Glasgow in the 1860s and went on to become one of the wealthiest citizens in Britain’s “Second City.” He served as president of the Glasgow Chamber of Commerce in 1896 and 1897.[14]

The second example, beer brewing, takes us around the world. The German brewing tradition and “spill over” of experts stretches back to the Early Modern period. In sixteenth-century Utrecht, for example, brewing specialists and personnel were predominantly German.[15] During the nineteenth century, advances in brewing chemistry and cooling techniques helped push the industry toward mass production. At the same time, consumers worldwide moved away from heavy brown beers and towards lighter Bavarian or Bohemian-style lager beers, creating the need for specialists and entrepreneurs in situ to satisfy their demand. Prospective migrants had not only received formal training (“explicit knowledge”) but were also in possession of culturally inherited, non-codifiable knowledge that had accumulated over generations (“tacit knowledge”). The two-tier differentiation of knowledge was first developed by Michael Polanyi in the 1950s and provides an additional theoretical framework for explaining migrant success. Explicit knowledge is codified and can be expressed in numbers, words, plans, or manuals, but only constitutes the tip of the knowledge iceberg. The larger part is made up of tacit knowledge, which includes personal experiences, beliefs, and values that, within a professional context, can only be acquired through long-term engagement with a given craft, machinery, skill, or intellectual problem. It is personal, context-specific, and therefore difficult to articulate.[16] It can be transferred only through human resettlement, and it is an essential ingredient in migrant success if the specific skill is in demand in the receiving economy. The brewing industry represents a good example. As shown below, German brew masters were found across the world. They had often trained at the brewing college of Weihenstephan near Munich (est. 1865), which also attracted many foreign brewing specialists.

The American brewing industry was largely created by nineteenth-century German immigrants through companies such as Budweiser (Anheuser-Busch), Coors, Pabst, and Schlitz. A predominance of German immigrants could be found in the beer industries of other countries as well. In Brazil, Germans started brewing in the 1830s, developing large breweries such as Ritter in Rio Grande do Sul. Another example is Brahma, one of the two largest brewers in Brazil today. It started production in the 1880s and, since 1906, has been controlled by the Kunning family.[17] In Argentina, Otto Bemberg established his brewing empire in Quilmes starting in the 1880s. His main competitor was Bieckert Brewery, which won a prize for its beer at the world exhibition in Philadelphia in 1876.[18] Examples from Chile include the breweries established in 1874 by Gustav Keller in Concepción (Keller Hnos.) and Otto Schleyer in Talca. They merged in 1907 to form the Sociedad Cervecerías de Concepción y Talca with a staff of about 100.[19] In Asia, China and Japan offer relevant case studies. The Tsingtao Brewery was founded during the German colonial presence in Kiautschou (1897-1919), and it still produces one of the main Chinese export beers. The Japanese brewing industry has its roots in the “Bavarian Brewery” founded in 1869 by a German-American, E. Wiegand. Management passed into Japanese hands in 1888. The beer was renamed Kirin and is today one of the national market leaders and export beers.[20] In Australia, lager beer was first brewed in 1885 by two Germans who founded the Gambrinus brewery in Melbourne in 1885. The real impetus, however, came when Dortmund-born Edmund Resch bought a brewery in Sydney in 1896 and made it into one of Australia’s largest beer producers. Although the company was taken over by a consortium in the 1920s, its name still lives on as Resch’s Pilsener. During World War I, the seventy-one-year-old Resch was interned near Sydney as an “enemy alien.” His two Australian-born sons took over the firm, using advertising slogans such as “Resch’s Australian XXX Ale – Brewed by Australians for Australians.”[21]

Thus, brewing and chemistry are two examples of sectors with a worldwide German entrepreneurial presence. They were also firmly intertwined. Mass production of beer had only been facilitated through advanced chemical research, and the “brewing chemist” became a key position in any large brewery. It is no surprise, therefore, that German brewing chemists and lager brewers with chemical knowledge were also found abroad. Around 1900, at least seven Japanese breweries employed German head lager brewers, and most of the machinery was imported from Germany. Another example is J. & R. Tennents in Glasgow, which was the biggest lager producer in Britain at the time. Fritz A. Schreiber was employed as head lager brewer in 1908 and quickly moved into management, taking over as managing director of the brewery in 1912. But like Edmund Resch in Sydney, he was forced out of his position after the outbreak of war in 1914. The company board let him know that due to “so very strong a feeling against the re-imposition of the foreign element in the management” it had decided to dispose of his services. Just like 25,000 of his compatriots in Britain, he was first interned as an enemy alien, and later repatriated. Schreiber died shortly after his return to Germany.[22] German brewing was yet another branch whose global standing was adversely affected by World War I.

Trade and Industry

In his history of nineteenth-century globalization, Jürgen Osterhammel rightly argues that a one-sided focus on industrial production disguises the persistent significance of merchants. “They remained the most important ‘interweavers’ [Verflechter] of the global economy. By adapting to changing circumstances and, at the same time, putting their imprint on these circumstances, they entwined distant markets, brought together different regimes of production such as the textile factory and the cotton plantation, and accumulated capital that could then flow into banks and the industry.”[23] As the value of world trade grew tenfold in the latter part of the nineteenth century (and as German trade grew even faster), German merchant communities sprang up in all world regions with trading potential. Two grey zones have to be pointed out, however. First, the distinction between trade and industrial activity was often not clear cut (and was, in any case, only drawn by twentieth-century economic science). Especially in emerging markets such as Latin America or Australia, migrant entrepreneurs might start off importing goods and later move into production, having identified the potential of a given product on a local or national market. In the Chilean province of Concepción, for example, a number of established German merchant houses later went into textile production or invested in the ceramics industry. A third of the large German-Chilean industrialists had had previous experience in trade. These individuals fully exploited the competitive advantages of transnational entrepreneurial mobility and competence. They were able to assess the medium-term interplay between internal demand and external supply. Through their established networks of business contacts they could gather information about novel products or production techniques abroad, had direct access to raw materials and production facilities, and ultimately sold their products through their network of retailers.[24]

The second grey zone concerns the question how “German” these merchants actually were. After 1871, national cohesion and consciousness was forcefully pushed by elites, with anti-urban concepts of Heimat and Volk constituting ideological links between the local and the national. Even then, however, citizenship came at two levels: on the national level and on that of the respective territorial state. Regional identities persisted well into the Imperial era, and these, in turn, generated very different conceptions of “Germany.” The southern states of Baden, Württemberg, and Bavaria, but also the northern city states of Hamburg and Bremen, had stronger liberal and civic traditions than, for example, Prussia or Saxony. Entrepreneurial networks abroad were often linked to these city states rather than to Germany as a whole.[25] Late-Wilhelmian discourse, fired by global weltpolitisch aspirations and growing nationalism, was unperturbed by differentiations of this kind. Merchant communities abroad were to be regarded as integral parts of the same Volk and economic bridgeheads of a “Greater German Empire.” They were supposed to act as a link between the metropole and its globally dispersed emigrant communities at large. These, in turn, were to act as promoters or customers of German industry and trade and were to maintain their political allegiance to the Kaiser as well as their cultural, linguistic, and religious “Germanness.” German-Americans were an exception within this confection. Due to rapid assimilation, they were regarded as a lost cause to “Deutschtum” in contrast to, say, German-Brazilians.[26]

The lived reality on the ground differed to some extent from these ideological pretensions. Merchants conducted business within multi-ethnic environments, adapted their practices accordingly, and developed hybrid identities. These qualities, rather than Pan-German hetero-perceptions, generally lay at the heart of entrepreneurial success. Nevertheless, the growing global economic, cultural, and colonial presence of the German Empire contributed to the emergence of a national consciousness. German communities abroad were represented as micro-models of national (and thus supra-regional) cohesiveness.[27] Pertinent ideas were increasingly disseminated by ethnic leaders abroad from the 1880s. These leaders were often entrepreneurs. In Glasgow, for example, the Hamburg-born timber merchant and honorary consul, Johannes N. Kiep, belonged to a mobile merchant family whose illustrious members ranged from Jacob Leisler, the Governor of New York (1689-1691) to Walther Leisler Kiep, one of the leading figures in postwar German conservative politics.[28] In a speech to 250 compatriots in 1906, Kiep stressed “that the Germans in Great Britain will move closer and closer together, [cultivating] faithful allegiance to their fatherland and Germanness.”[29] National demarcations started to penetrate cosmopolitan merchant communities. German merchants were increasingly drawn into the competing forces of nationalism, colonial interests, and cosmopolitanism that ultimately erupted after August 1914.[30] A snapshot of globalization from Blumenau, a predominantly German town in southern Brazil, illustrates these tensions. One of the local ethnic newspapers, Der Urwaldsbote, published an article entitled “Deutsche Kaufleute im Auslande” [“German Merchants Abroad”]. The author identified a “deplorable lack of national pride amongst some German merchants abroad” and mentioned the case of an “incredible occurrence” in Tokyo. The manager of the Japanese branch of a large German firm had received a request, in German, from the Japanese war ministry and answered in English. This lack of pride in the German language made the author of the article “blush with national indignation” [nationale Schamröte].[31]

In addition to these two grey zones, the lead theme of the following global overview of German merchant activity includes the question of regional, national, and transnational economic impact. In order to identify patterns of settlement and activity, the outline is exemplary rather than comprehensive in nature. We shall start in Western Europe and consider the example of Antwerp. The Belgian city developed into a major European trading center in the course of the nineteenth century, and “the contribution [of German merchants] to the Antwerp economy was extremely important.” Many of them originated from the bordering Rhineland and Westphalian industrializing regions, connecting these regions with the wider world as overseas traders. Their transnational operations were often conducted within family networks extending to Germany, as well as third places. They also adapted to the local economy. As Antwerp went on to become one of the main European turnover places for fur and wool, German merchant houses such as Königs-Günther & Co. dominated that market segment. The community was composed, on the one hand, by senior merchants who managed their own business or a branch of a German business, often as family members, and, on the other hand, by junior clerks who came to the city to acquire skills before moving on, returning home, or setting up their own business. This two-tier structure was a general feature of merchant communities.[32] Many merchants acquired Belgian citizenship and integrated into the host society. Others kept closer ties with Germany, celebrating, for example, the Kaiser’s birthday after 1871 and expressing nationalistic pan-German ideas. This led to tensions with the local francophone elites before and after the outbreak of war.[33]

A comparison of two regions in Italy – Lombardy in northern Italy and Naples in the south – confirms these patterns, stresses the importance of networks, but also argues for regional differentiation. Today, Lombardy is the most industrialized and richest region in Italy. Its capital Milan has been a trading center for centuries, especially for silk, but has failed to produce a concomitant industrial sector. From the late eighteenth century onwards, transnational entrepreneurial networks “fostered a new entrepreneurial culture [in Milan] and the acceptance of scientific innovation, financed countless ventures in established as well as new manufactures, imported innovative production processes, specialized workers, and managerial forces, founded commercial journals, [ . . . ] and set up the Society for the Encouragement of Arts and Science.” Two of the most influential figures there were Adam Kramer and Heinrich Mylius, German-born entrepreneurs who established mass production of silk and cotton products, as well as dynasties that dominated trade and production in the region up until World War I. They also moved into insurance and other financial services and extended their family- and partner-based trade networks into Europe’s foremost textile region around Manchester. They integrated well with local urban elites and disseminated their knowledge through technical colleges and other establishments, contributing to the ongoing development of the region as a whole.[34]

This was not the case in Naples, where an elaborate Protestant network of Swiss and German entrepreneurs settled from the 1820s onward. Its members soon developed into a tight “business group” and dominated textile production throughout the nineteenth century. They remained an ethnic enclave and had no interest in disseminating knowledge. Development in the region as a whole lagged, and still lags, behind northern Italy. The business group was also connected with both Lombardy and the English textile regions. In the 1830s, for example, Manchester-based Heinrich Schunk, who had originally come from Frankfurt, joined the group.[35] Both in Milan and Naples, German networks expanded their operations after Italian (1861) and German (1871) unification. They were now joined by additional trade networks, company representatives or engineers who often set up their own businesses over time. These growing expatriate business communities were increasingly organized along national lines. In Milan, Federico Mylius, a descendant of Heinrich, founded the Deutscher Hilfsverein in 1871. This support organization aimed to help immigrant laborers and to preserve the Deutschtum (“Germanness”) of diaspora Germans in the region. In Naples, the previously cross-minority Protestant congregation was split in the 1860s into German Lutheran and Reformed Swiss/French.[36] When Germans in Naples celebrated the Kaiser’s birthday on January 27, 1898, there was unanimous agreement that German naval expansion should be pushed further. A cable was sent to the German Reich Chancellery, affirming that “we, the Germans in Naples, always take the greatest interest in all the national current affairs that occupy peoples’ minds back home in the Reich.”[37] After Italy entered the war in 1915, the capital of most German enterprises in Italy was sequestrated by the state.

Significant merchant communities also developed in Great Britain during the nineteenth century. Outside London, destinations included Manchester, Bradford, Liverpool, and Glasgow. Whereas indigenous merchants were mainly concerned with overseas markets, German houses had virtually monopolized the growing trade with the continent. Some eventually moved into banking in the city of London, where they set up some of the largest private banks. Examples include the Schröders and the Speyers (who also operated in Paris and New York), as well as Ernest Cassell and Alexander Kleinwort. Drake, Kleinwort & Co. had a capital of £4 million in 1914 and was the largest private bank in the city after Rothschilds. The latter, of course, had been founded as a branch by the late-eighteenth-century German-Jewish immigrant Nathan Meyer Rothschild.[38] After the outbreak of war, large-scale sequestration of German-owned capital also occurred in Britain and its Empire. In Britain, Italy, and elsewhere, the German business presence never regained its pre-war levels.

In the Ottoman Empire, the largest German merchant colonies existed in Istanbul, Smyrna, and Saloniki. There was also industrial and extractive activity. On the North Aegean island of Thasos, for example, the brothers Speidel of Pforzheim discovered zinc ore, acquired a prospecting license for the whole island, and started mining in 1905. Several dozen German engineers, administrators, and miners moved to the island. They erected processing plants, laid a telegraph cable and established a regular shipping connection with the mainland. In line with the Empire’s weltpolitisch dreams before 1914, German authorities as well as the Speidel brothers portrayed the island as a quasi-colonial territory in German possession.[39]

Further east in the Russian Empire, German merchant communities were ubiquitous in St. Petersburg, Moscow, and other urban centers throughout the modern period. After the Napoleonic era, when their English expatriate counterparts started to concentrate more on the British colonies, German merchants were a dominant force in Russian foreign trade. Heinrich Schliemann is arguably the most prominent example. He came to Russia in 1846 as a company representative, made his first fortune in the indigo trade and subsequently diversified and expanded his business empire. He became one of the richest men in Europe and, from the 1870s onward, devoted his life to the discovery of ancient Troy. The German business communities were ethnically inward-looking; they exhibited a low degree of integration into Russian society and an elaborate ethnic life (clubs, churches, restaurants, press). In general, German entrepreneurs in Russia during the nineteenth and early twentieth centuries were successful, with some individuals amassing enormous wealth. Examples in St. Petersburg include the banker Alexander Baron Stieglitz, the ‘sugar king’ Leopold König, and the merchant houses Spies, Amburger, and Mollwo. Among the firms in Moscow, the internationally operating merchant house of Ludwig Knoop stands out. In the southern Russian regions of Saratov/Volga and the Black Sea, large firms developed on the back of German mass immigration. These included producers of technologically advanced machinery for the agrarian sector. In the Volga region, the milling industry and the production of sarpinka textiles (a mixture of linen and cotton) were largely dominated by German immigrant firms such as Reinecke and Borell. From the 1880s, international tensions rose, and the minority was increasingly identified with a “German danger.” The German ambassador to St. Petersburg, in turn, addressed his audience of resident Germans on the Kaiser’s birthday as “fatherland-loving Germans who are proud to belong to the powerful Reich.”[40] The Bolshevik Revolution of 1917 and subsequent nationalization policies meant the end of German entrepreneurship in Russia. Many German businessmen left Soviet Russia and moved their business activities to Germany or other countries.[41]

With 107 large German-owned companies in 1898, China and the British Crown Colonies were promising territory for entrepreneurial activity.[42] Germans in Shanghai numbered about 600. Most of them worked in trade; others provided services for the ethnic community by working as pharmacists, general practitioners, music-sellers, book-sellers, or butchers. There were thirty German merchant houses in Shanghai. Seventeen of them had branches in Hong Kong and elsewhere in China. Taken together, they had twenty-two branches or agents in Hamburg, three in London, three in Bremen, and one each in Hannover and Berlin.[43] Shanghai was a stepping stone for opening up the Yangtze River for German trade. This tied in with German semi-colonial interests in China during the period of High Imperialism, and the Empire sent several cannon boats to protect trade on the Yangtze and to enforce economic activity. Hankou (today part of Wuhan) was an important inland trading center that was opened up to foreign economic penetration starting in the 1880s. The Bremen-based merchant house of Melchers & Co. had previously established branches in Hong Kong (1866) and Shanghai (1877) and was now the first German firm to operate in Hankou in 1884. Melchers exported agricultural products (skin, fur, cotton, nuts, seeds, egg products, tallow), and to this end also built factories for processing egg products and skin that were regarded as the most modern of their kind in China. A small electricity works supplied electricity not only to the German settlement but also other parts of Hankou. Other German companies with similar activities that followed suit included Carlowitz & Co. and Siemssen & Co.[44] Germans in China had left their homeland (mostly temporarily) at a time of heightened nationalism, and it is therefore no surprise that this was reciprocated abroad. The Kaiser Wilhelm Schule in Shanghai, for example, which catered to the offspring of the community, aimed to “implant in all children a proud awareness of belonging to a powerful fatherland whose cultural achievements compare well with those of any other people.” [45]

German entrepreneurial engagement in Hong Kong is well expressed by the term “participatory colonialism.” With twenty-one large merchant houses, five shipbrokers, and eight retailers in 1898, Germany had only slightly fewer firms in Hong Kong than Britain or India. About sixty percent of both imports and exports to Europe went through German firms. These, however, were only part of a larger picture, as Germans participated to a large extent in British companies and institutions. Two of the nine board members of the Hong Kong Chamber of Commerce were German. The most important credit institute in the Crown Colony, the Hong Kong and Shanghai Banking Corporation (HSBC, today the largest British bank in terms of market value), had four German board members, one of whom acted as director in 1897. An estimate from 1906 found that one-third of all board positions in large British companies in Hong Kong were occupied by Germans. They also invested in, or owned, several production facilities for sugar, spinning, soap, acids, glass, and other products. Although they had no formal state authority in Hong Kong, Germans participated in, and profited from British rule there.[46]

German business activities in Southeast Asia and the Pacific have received little scholarly attention thus far. These activities occurred in different colonial contexts and confirm that the linking of European empires was never a purely national undertaking of the colonizing country. Merchants went for profits, not for nationality. They had no reason to rush into the newly created German colonies. In the French Vietnamese capital of Saigon, for example, Herr F. W. Speidel was the owner of Speidel & Co. and acting German consul. The European activities of the company were coordinated in the Paris office under the directorship of his cousin, W. Speidel.[47] In the Dutch East Indies, German companies made significant investments. In 1905, the German-Dutch Telegraph Company, which was dominated by the Allgemeine Elektrizitätsgesellschaft (AEG), completed a cable connection with the Dutch East Indies, the German Pacific colonies, and the German protectorate of Kiautschou in China. Siemens and Telefunken conducted numerous projects in the electrical sector.[48]

The largest commercial firm of German origin in Southeast Asia was Behn, Meyer & Co., which started operating in Singapore in 1840. It still exists today under the name Behn Meyer Group with business in chemicals, fertilizer, engineering and other products, and it has offices in Germany and throughout Southeast Asia. In the second half of the nineteenth century, the company developed a global trading empire that connected different colonial spheres with Germany and other world regions: manufactured goods and foodstuffs from Germany; tea, spices, silk, and porcelain from China; sugar, coffee, indigo, tobacco, and sappan wood from Manila; coal from England; Burmese rice and Ceylonese coconut oil; Malayan tin ingots bearing the stamp ‘B and M’ to London in exchange for Manchester goods; Swedish steel, iron ore, and tar in exchange for Siamese sugar; Western Australian sandalwood, horses, and ships for cane sugar. The company shipped prefabricated wooden houses and other colonial products to San Francisco to support the gold-mining industry in California, and also repacked and transported China tea to New York. Last but not least, it provided transportation for Muslim pilgrims to Mecca. From 1900, Behn, Meyer & Co. extended its operations into Dutch East India and, by 1913, it had eleven branches throughout the Far East. It asked the German government to pursue an economic policy that fostered large capital investments in the area. An investment trust under the name of Straits-und-Sunda-Syndikat was founded in 1911 and was joined by a number of commercial firms in Hamburg, banks such as Deutsche Bank and Commerz- und Disconto-Bank, as well as the Société Commerciale et Financière Belge of Antwerp. The latter represented fifteen German firms in Antwerp and one in London. Just before 1914, overall German capital involved in the Dutch Indies amounted to over 120 million marks, making it the fourth largest investor after Dutch, British, and Franco-Belgian capital in the colony.[49]

Business on the Pacific island colonies never took off as expected. The main firm trading in the area, Godeffroy & Sons of Hamburg, went into bankruptcy in 1879, five years before the establishment of formal German colonies in the area. Some of its business was taken over by the Deutsche Handels- und Plantagen-Gesellschaft der Südsee-Inseln in Hamburg (DHPG). Again, German colonial possession was not a guarantee for economic hegemony. In Samoa, German houses continued to dominate the economy in the 1890s with an import share of about fifty percent and an export share of eighty percent, but in Tonga the British replaced the Germans as the leading foreign businessmen despite German colonial rule. Generally, German entrepreneurial activity on the Pacific islands was threefold: as traders, as planters (copra, cotton), and as mine owners.[50] On Hawaii, Hinrich Hackfeld of Bremen built up a substantial sugar plantation and export business starting in the 1850s. Hackfeld & Co. developed into one of the biggest firms on the Hawaiian islands, adding a retail outlet under the name B.F. Ehlers & Co. in the 1880s. Its structure makes it representative of the transnational character of many of the firms discussed here. Hackfeld and Paul Isenburg (the latter of whom joined the company in 1881 and became a Noble of the Kingdom) acted as advisors to the local aristocracy. Isenburg was a trained agriculturalist who used his knowledge as an asset in his new environment. Their company was firmly integrated into the Hawaiian business community as one of the “Big Five” firms that dominated the islands’ economy. (The other four consisted of one British and three American firms.) At the same time, the firm maintained strong ties with Bremen. The company flag was a red Hanseatic cross on a white background. Isenberg returned to Germany in 1899, reverted to his German citizenship but carried on in the management. He died in Bremen in 1903, leaving a personal estate of $7,000,000. After his death, a nephew of the founder, John F. Hackfeld, took over, and the retail outlet was operated by another nephew, B.F. Ehlers. A brother-in-law, J. C. Pflueger, was in charge of the firm’s Bremen office. When John Hackfeld returned to Bremen in 1900, he continued to commute regularly to Hawaii, spending at least half of his time there until 1914. His successor in Hawaii was another cousin, George F. Rodiek. The representative company premises in Honolulu also functioned as consulate for the German Empire. The separate entrance had the arms of the German Empire carved over the door. Every year, on the Kaiser’s birthday, the consul hosted a lavish reception for the leaders of the local German community. In 1917, the company was seized by the U.S. government as alien property. The retail store was renamed into the Liberty Store.[51]

Hackfeld & Co. points to a number of constitutive features of transnational companies led by migrant entrepreneurs: transfer of capital and knowledge; integration into both local and foreign business elites; back and forth travel and resettlement; close family ties across time and space; and flexible nationality (entrepreneurs often became naturalized elsewhere for legal advantages in conducting business). Hackfeld & Co. is also a case history for the overlapping and fluid relationship between region and nation in Imperial Germany, with its Hanseatic flag being complemented by the symbolism of the German Empire after 1871. These complex levels of business activity and identity make it problematic to apply one-dimensional labels of “German” or “Hawaiian” (after 1898 “American”) to companies such as Hackfeld & Co.[52]

In Africa, entrepreneurial activity was linked to colonial ambitions. Merchant Adolf Lüderitz had spent several years in North and Central America before setting up his own tobacco business in Bremen in 1878. He soon established agencies on the West African gold coast, where he traded in arms, liquor, and tobacco. He then invested in an expedition to Southwest Africa with an eye on its promising diamond and gold deposits. At the same time, he wrote to the Foreign Office in Berlin, asking for the Empire’s legal and military protection, which was granted in 1884. This marks the beginning of Germany’s short-lived colonial empire. German Southwest Africa remained predominantly a settlement colony based on stock-farming. As such, it offered little potential for trading companies. This was different in Togo and Cameroon, where German merchants settled on the narrow coastline, invested in plantations, and traded in goods such as palm oil, palm kernels, and caoutchouc. In German East Africa, merchants imported consumer goods for the European and African population and exported cotton, sisal, and other goods. Just as in the Pacific and Southeast Asia, individual entrepreneurial activity should not be inextricably reduced to colonial hegemony. “Plural societies” (Conrad) developed. In German East Africa, the trading community included local populations, Arabs, Indians, Boers, a number of successful Greeks who had arrived via Egypt, and other European nationals. Similarly, German entrepreneurs were active all across Africa in different colonial contexts, whether in French Morocco, British Egypt, or Portuguese Angola. Just as in Britain, riots against German-owned businesses occurred in British South Africa during World War I. The loss of Germany’s colonial empire in 1918-19 wiped out significant investment and capital in its former colonies.[53]

Australia was a magnet for a smaller branch of nineteenth-century mass emigration. The first German settlements sprang up in the late 1830s, and by 1891 the total number of Germans in Australia was 45,000. Entrepreneurial activity made an impact in a number of economic sectors. Apart from the brewing industry, which has been discussed above in connection with Edmund Resch, wine growing constituted an important area of entrepreneurial activity. Today, the Barossa Valley in South Australia is one of the foremost wine regions in Australia with a large export market. The roots of the wine industry there can be traced back to the 1850s, when Joseph Ernst Seppelt of Lower Silesia established the Seppeltsfield vineyard. Under his son Oscar Seppelt the business developed into one of Australia’s leading wine producers. Here and in other wine growing areas, the Seppelts, as well as other German immigrants such as Richard Schomburgk and Adam Roth, dominated Australian viticulture throughout the nineteenth and well into the twentieth century. German immigrant businessmen also made it into the urban elites. One example is Hugo Muecke, the son of a German ‘48er, whose company H. Muecke & Co. was the largest customs and shipping firm in Adelaide. In the years before 1914, Hugo Muecke acted as consul for Germany and held a number of positions, including president of the Chamber of Commerce and board member of the Bank of Adelaide. In the same city, Johann Menz established a successful chocolate and biscuit factory. Melbourne examples include shipping magnate John Korff and the piano manufacturers Octavius Beale and Hugo Wertheim. In the outback, Australia’s natural resources offered immense opportunities. A number of Germans amassed great fortunes in the mining business. Hamburg-born Bernhard Holtermann, for example, discovered the world’s largest specimen of reef gold in 1871 and invested this money in a number of other businesses. Carl Rasp discovered rich silver ore in New South Wales in 1885 and quickly made a fortune, subsequently moving to Adelaide to become part of the local urban elite.[54] Thus far, German-Australian entrepreneurship has received little specific attention in existing scholarship. Overview monographs and articles tend to concentrate on the settlement process in Australia rather than urban elites.[55] The Immigrant Entrepreneurship project would be a good model for the establishment of a methodologically sound equivalent for Australia and New Zealand.

The historiographical situation is different for Latin America. A rich scholarship exists in concomitance with the significance of German ethnic elites for local and national economies throughout the subcontinent, Central America, and Mexico. Germans were part of an international business elite together with mainly British, French and, as the century progressed, North American entrepreneurs. After 1871, their success was boosted by an economically strong German Empire. Through their transnational networks, they connected Latin America to global markets, possessed considerable know-how when it came to processing abundant natural resources, and also helped attract foreign expertise with regard to the same. Their connections were not only with Hamburg, Bremen, or Frankfurt, but also with London, Paris, and New York. This included access to the international capital market and modern technology, which enabled them to engage in factory production, mining, and plantations. From the 1870s, large-scale investment opportunities emerged through infrastructure projects such as railways, ports, and electrification. AEG, Mannesmann, H. Stinnes, and Zeiss were among the large German companies involved in these projects. These companies were similar in that they tended to bring their own merchant and technical personnel. Each Latin American country hosted a group of German merchants, bankers, and entrepreneurs (but also engineers, scholars, and officers). The merchants often started off as representatives of German merchant houses to sound out the local market and eventually set up their own business, in some cases establishing family dynasties. They traded mainly agricultural products and raw materials to Europe and imported high-technology industrial products.[56]

Mexico can serve as the first example of these patterns. In 1910, its capital hosted about 1,300 German-born residents, many of them engaged in trade, retail, and/or industry. Many of the country’s leading import and retail houses had been established by migrant entrepreneurs or were modeled on German houses. By the 1880s, a clear specialization had emerged in the form of iron and steel products, machinery, chemicals, clocks and watches, jewels, glassware, and optical instruments. The sale of hardware, drugs, and musical instruments was more or less controlled by Germans. Import was not only from Germany but also from the United States and other countries. By 1910, about forty “German” merchant houses existed in Mexico City, as well as one hundred commission branches [comisionistas] of German companies offering foreign products. Mexico’s most important hardware store – which still exists today – was Casa Boker. It was founded in 1865 by Robert Böker of Remscheid, who had been sent to Mexico by his family to organize the sale of its iron and steel products there. This was part of a transnational business strategy that also sent family members to Buenos Aires, Melbourne, New York City, and St. Petersburg. Over the next decades, the Mexican family enterprise developed into the country’s first hardware store of significance, distributing 40,000 different products. In 1910, it moved into a representative department store in Mexico City that, at 1.5 million gold pesos, was the most expensive commercial building in the capital. Contemporary observers dubbed Casa Boker the “Sears of Mexico.” Other German import houses of national significance included Korff, Honsberg y Cía (hardware, est. 1901), Felix, Johannsen y Cía (chemicals), and Diener Hnos. y Cía/La Perla (jewelery, est. 1896), whose partner firm was Diener & Rothacker in Pforzheim, Germany. The paper factories Loreto and Peña Pobre were founded by the engineer Albert Woern. In 1898, Siemens & Halske built the electrical power system for lighting Mexico City. In the banking sector, Esteban Benecke, the offspring of a banking family based in Berlin, represented Deutsche Bank in Mexico from 1870. In Porfirian, Mexico, Hugo Scherer and his son, Hugo Scherer, Jr., rose to prominence. When the Banco de Comercio e Industria was established in 1906, Hugo Scherer, Jr., sat on its management board, together with Franz Böker of Casa Boker. The bank drew its capital from Deutsche Bank (Berlin), from Speyer & Co. (New York), and the Mexican National Bank. When Mexico City’s chamber of commerce was established in 1908, a number of German entrepreneurs, including R. Boker, A. Diener, Felix, and Honsberg were involved.[57]

In all Central American countries, Germans formed small economic elites, adapting their activities to the demands and opportunities of both local and global markets. In Costa Rica, for example, German family businesses such as Steinvorth, Knöhr, and André were among the principal Costa Rican houses to engage in the lucrative business of coffee production and global export. Their family and partnership connections with the Hanseatic port cities proved particularly advantageous when it came to gaining access to overseas markets, and many of them continued to trade well into the twentieth century. In the immediate pre-war years, German investment in Costa Rica was estimated at 35 million marks, in Nicaragua at 42 million, and in Guatemala at 300 million.[58] A similar picture emerges for Venezuela where, starting in the 1860s, a small group of German merchants gained “commercial hegemony” (Zeuske) on the basis of trade and banking. This transcultural elite was well connected with the local elite through intermarriage. This was complemented, from the 1890s onward, with increased direct German investment. The Diskonto-Bank and engineers Krupp teamed up to complete a number of major infrastructure projects such as the purely “German” railway line “Gran Ferrocarril de Venezuela,” or the river transport and storage enterprise “Bodegas Alemanas.” Around 1900, Venezuela hosted thirty-eight large German-Hanseatic merchant houses. Important businesses included G. H. & L. F. Blohm with its seven sub-companies in major Venezuelan cities, and Breuer, Müller y Cía, the country’s largest “coffee-imperium.” Although Venezuelan foreign trade was almost completely controlled by merchant houses of German origin, it would be misleading to interpret these as foreign instruments of German imperialism, competing against American and British interests on the subcontinent. They were transnational entrepreneurs, conducting trade not only through Hamburg, but also through the major North American and British ports.[59]

Neither Mexico, Central America, nor Venezuela experienced any German mass immigration. The situation was different in Brazil, where we can study the symbiosis between large-scale settlement and ethnic entrepreneurship. Success was hinged on ethnic ties not just within a local, but also within a transnational context. This was most pronounced in the southern state of Rio Grande do Sul, whose German-speaking population rose from 60,000 in 1872 to 300,000 in 1917. The first industrial firms in the region were founded by Germans in the mid-nineteenth century, and Rio Grande do Sul subsequently developed into the industrial heartland of Brazil. In 1895, all of the region’s thirty industrial firms had owners of German origin. The number of firms soared to over three hundred in 1908. At the time, Germans still dominated many branches; in fact, in some branches, they were the only names, e.g. the manufacture of soap, leather, paper, glass, beer, carriages, metal furniture, and in foundries. Inland ethnic colonies such as Novo Hamburgo, Teutonia, or Villa Nova were connected to the wider world through the growing port city of Porto Alegre. The city’s German merchant community supplied the ethnic settlements with industrial imports from Germany and exported its agricultural commodities such as tobacco, wood, and potatoes, while also increasing its industrial outputs. German houses dominated the trade sector in Porto Alegre, where they accounted for ninety-six of the city’s 140 trading firms in 1914. Some businesses suffered from anti-German hysteria during World War I, but most resumed their activities after the war had ended.[60]

Conclusion

This global overview has shown that the United States was not a singular case. It can be integrated into the wider framework of entrepreneurial migrations around 1900. German industrialists and merchants could be found in all world regions, conducting multi-directional business and establishing complex transnational networks. The article has shown that the hybrid and transnational character of these enterprises makes it impossible to apply the one-dimensional label of “German entrepreneur.” They were integrated into their own local, national, and also global economies. Links with Germany were important, but by no means the only factor in explaining relative success. The main argument here is that entrepreneurs were successful not because they acted in a national sense as Germans, but because they acted transnationally – not least through the act of relocation – and aligned their strategies with the international markets of a globalizing economy. Their primary aim was not to strengthen the German Empire’s economy by acting as its outposts (as ideological constructions envisaged), but to strengthen the position of their enterprises, their transnational networks, and also their local economies. This, however, does not mean that they were immune to those nationalist ideas of a “Greater German Empire” that took hold in Germany and its ethnic communities abroad. It only means that these sentiments had no ascertainable effect on business strategies or societal engagement. Many acted as promoters of their respective local industries as investors, representatives in chambers of commerce and other local institutions, or as benefactors. Examples included the Mylius family in Lombardy, the Rottenburg family in Glasgow, and the Boker family in Mexico City.

The transnational approach helps us to avoid the pitfall of interpreting these activities as proof of German global contributionism, or, as contemporaries put it, of seeing German emigrants as the “fertilizer of other peoples” [Völkerdünger]. Germans in the United States and elsewhere were almost obsessed with stressing their positive impact on host societies and securing their place in national narratives. Elites in the Empire seconded this by postulating global cultural and economic superiority. Kathleen N. Conzen rightly asks for immigration scholarship to be “empathically non-contributionist” to counter these views, which lingered in historiography until well into the twentieth century.[61] It is certainly true, and has been shown above, that German entrepreneurs played some part in connecting pre-industrial regions with the world economy. Their main concern, however, was not the glory of the German Empire but rather the business potential of a globalizing economy. This development experienced a sudden contraction after August 1914. German entrepreneurship and capital abroad were affected by general, at times violent, Germanophobia as well as government measures such as sequestration, internment, repatriation, and decolonization. It would take more than half a century for the German economy to reach comparable levels of global integration.

The empirical and methodological findings of the Immigrant Entrepreneurship project have the potential to provide a model for similar undertakings elsewhere. Comparable prosopographical compilations for national economies such as those of Brazil, Russia, Australia, or Great Britain would generate valuable insights into the scope and economic significance of immigrant entrepreneurship. This is all the more relevant as national projects tend to disregard the existence of foreign individuals or networks. The aforementioned Paul Rottenburg, for example, did not find his way into the otherwise comprehensive Dictionary of Scottish Business Biography.[62] Not least anti-German sentiments during two World Wars left historiographical gaps in many countries that can now be closed under transnational, rather than national, auspices. This article has outlined a few thematic contact areas between German-America and the wider world and thus aims to open up avenues for further research. A more solid empirical basis is needed for a better understanding of the relationship between transnational migration, economic development, and globalization.

Notes