The Origins of Tech Titans: From Yarn to Unicorns
The common narrative surrounding tech billionaires like Jeff Bezos, Steve Jobs, and Elon Musk often includes the notion that they built their empires from scratch in suburban garages. However, this rags-to-riches tale is far from the truth. In fact, the playbook for corporate success has been in use since the 18th century, pioneered by individuals like Richard Arkwright. Arkwright, a figure from Lancashire, is credited with developing a system for spinning cotton fully into thread, which led to his immense financial success. However, behind this facade of prosperity lies the dark reality of inhumane working conditions and exploitation of workers, including children as young as seven working 13-hour shifts.
In his book, “Blood in the Machine: The Origins of the Rebellion Against Big Tech,” LA Times tech reporter Brian Merchant reveals the hidden costs of capitalism during the industrial revolution and pays homage to the workers who fought against the early waves of automation— the Luddites. Emphasizing the immense impact of the textile industry on the birth of tech titans, Merchant highlights how the first entrepreneurs were not building global networks or space rockets, but rather making yarn and cloth.
During the 18th and 19th centuries, entrepreneurship was not a cultural phenomenon but rather a risky endeavor undertaken by businessmen seeking increased profits. The term “entrepreneur” was popularized by Jean-Baptiste Say in his work “A Treatise on Political Economy” in 1803, as he believed that Adam Smith’s “The Wealth of Nations” lacked an account of the individuals who took on the risk of starting new businesses.
For workers during this time, aspiring to become an entrepreneur meant more than just seeking upward mobility. It involved following a specific path, such as graduating from an apprentice to a journeyman weaver, eventually owning their own loom, becoming a master weaver, and running their own shop. This path was the norm for ambitious and skilled weavers.
Entrepreneurs during the 18th and 19th centuries, like their modern-day counterparts, recognized that technology and automation could disrupt traditional customs and increase efficiencies, output, and personal profit. Owning technology of production provided a chance to gain an advantage or capture market share from others. Starting a small business involved personal financial risks, such as taking out loans to purchase equipment or using inherited capital to invest in machinery and production.
Among the entrepreneurs of the Industrial Revolution, one figure stands out— Richard Arkwright. Born into a middle-class family, Arkwright initially apprenticed as a barber and wigmaker. Over time, he invented a waterproof dye for wigs and used the money he earned from this invention, along with his second marriage dowry, to invest in spinning machinery. Arkwright’s advancements with spinning cotton into yarn using water or steam power led to the creation of the water frame and carding engine, which he patented in 1769 and 1775 respectively. With investment from wealthy hosiers in Nottingham, Arkwright built his famous water-powered factory in Cromford in 1771.
Arkwright’s true innovation was not the machinery itself, as similar machines had already been patented. Instead, his innovation lay in successfully implementing a modern factory system. He demonstrated that the new technology, when combined with a particular work regime, could generate enormous profits. His factory system, which became widely emulated, involved dividing the workforce into two overlapping thirteen-hour shifts. Workers were strictly regulated, and lateness resulted in forfeited pay. At its peak, Arkwright’s factory employed two-thirds of its 1,100-strong workforce, most of whom were children as young as seven.
Arkwright also built housing for his workers and gave them one week of vacation a year, with the condition that they couldn’t leave the village. Today, similar conditions persist in factories where consumer products are manufactured, with on-site dormitories and strict production processes. Companies like Foxconn have faced scrutiny for their grueling working conditions, leading to suicide epidemics among employees.
The strict work schedule and rules enforced by Arkwright instilled a sense of discipline among workers, setting a new standard for long, grueling shifts inside factory walls. Prior to this, similar work was done at home or in small shops, where shifts were less rigidly enforced.
Arkwright’s legacy is still present in companies like Amazon, which strive to automate processes and implement highly surveilled worker-productivity programs. The blueprint he created for marrying technology with a strict work regime continues to shape the strategies of modern tech titans.
In conclusion, the story of tech billionaires rising from suburban garages is a myth. The reality is that the playbook for corporate success was established long ago by individuals like Richard Arkwright during the industrial revolution. While their advancements in technology and automation brought about immense wealth, they also perpetuated inhumane working conditions and exploitation of workers. Understanding the origins of the tech industry reveals the darker side of its history and prompts us to question the ethics of our present-day corporate kings.
