Little Bits of History

March 18

Posted in History by patriciahysell on March 18, 2017

1850: American Express is founded in Buffalo, New York. It began as an express mail service, aka special delivery service when Henry Wells, William G Fargo, and John Warren Butterfield merged their companies to create a larger business. Two years later, Wells and Fargo wished to expand out to California and were thwarted so they started Wells Fargo & Co. American Express was originally headquartered on the corner of Jay Street and Hudson Street in Manhattan. They held a monopoly on moving goods, securities, and currency along with other items throughout New York State. They eventually partnered with other express companies, including Wells Fargo, along with railroads and steamship companies and went nationwide.

In 1882 American Express went into the money order business to compete with the USPS. In the late 1880s, William Fargo’s brother was traveling in Europe and despite having traditional letters of credit, found it difficult to get money in any but the largest European cities. Upon his return, he had Marcellus Berry create a better way – the Traveler’s Cheque was launched in 1891. This service made American Express an international company. At the outbreak of World War I, American Express in Europe was one of the few companies willing to assist Americans stranded there by the war. The British selected them as their official express service, delivering letters, money, and parcels to British POWs and the end of the war, they were delivering 150 tons per day to POWs in six countries.

President Theodore Roosevelt had them investigated for monopolizing the railroad express service. Nothing immediately happened, but during World War I, President Woodrow Wilson needed to commandeer the railroads for troop movements and other war efforts. The monopoly was broken and a new company formed, much of which had been former American Express business assets.

American Express first proposed to offer a travel charge card in 1946 but they did not enter the field until 1958, eight years after Diners Club became the first independent credit card company. American Express cards were so popular, 250,000 were issued before the launch date. The next year, they began to issue plastic cards, an industry first. They began to issue Gold and Platinum cards to different markets and for a time had Optima cards as well. It wasn’t until the 1980s that American Express began their push to become a financial service super company. For more than a decade, new companies were purchased to expand the investment banking side of the business. The last of these were sold off in 1994.

 Money won’t create success, the freedom to make it will. – Nelson Mandela

A business that makes nothing but money is a poor business. – Henry Ford

A wise man should have money in his head, but not in his heart. – Jonathan Swift

When I was young I thought that money was the most important thing in life; now that I am old I know that it is. – Oscar Wilde