Minting A Sticky Fortune

Hello! Welcome to the third edition of Deep Pockets! Thank you for being here!

If you’ve ever listened to a podcast featuring a mega-rich entrepreneur, I can almost guarantee you will hear them say some version of:

“One day, I finally just took the plunge and got started doing XYZ. And that ended up being a flop. But along the way, I saw that people really loved ABC… so I changed directions, focused on ABC… and bing bang boom, that’s how I made my fortune.”

If you want to make a Deep Pockets fortune keep these two facts in mind:

a) You just need to take the plunge on some idea.

b) Your idea will probably change along the way.

We all want a garage full of Lamborghinis. But did you know that Ferruccio Lamborghini actually started out making tractors? It’s true. This is a very early model Lambo:

But we’re not talking about Lamborghinis today…

DEEP DIVE: Minting a Sticky Fortune

The subject of today’s Deep Pockets Deep Dive was born in 1861 in Philadelphia. His father was a soap maker. His life was destined to be all about soap.

Starting at age 10, he spent his weekends walking the streets of Philadelphia selling his dad’s soaps out of a basket. By 13, he had dropped out of school and was the company’s top salesman.

In 1891, at the age of 29, he moved to Chicago with $32 and a dream to make his own soapy fortune.

To boost sales, he came up with a clever sales gimmick: Every bar of soap came with a free pack of baking powder.

As it turned out, his customers were much more interested in his baking powder than his soap. So, he ditched the soap and made baking powder his primary product.

As a new promotional gimmick, he included two free packs of chewing gum with every baking powder purchase.

As it turned out, his customers were much more interested in his chewing gum.

And that’s how William Wrigley ended up in the chewing gum business.

Contrary to what you might assume, Wrigley’s did not actually produce its own gum in its first two DECADES of operations. Production was initially outsourced to a company called Zeno Manufacturing. In 1911, William acquired Zeno and renamed it the William Wrigley Jr. Company.

Wrigley took his company public in 1919.

A pioneer in the use of advertising, during his lifetime, William spent over $100 million promoting his products on billboards, in magazines, and in newspapers. He spent more money on advertising than anyone else in America in 1915.

He also never gave up on promotional gimmicks. In 1915, he mailed a free pack of gum to every address listed in any US phone book. He also had a policy of mailing two sticks of gum to every child in the US on their second birthday.

A passionate baseball fan, in 1921, William became the majority owner of the Chicago Cubs. In 1926, the team’s stadium was christened “Wrigley Field.”

The Wrigley family owned the Cubs until 1981. William’s grandson was forced to sell 80% of the team to Tribune Company in 1981 to pay a large estate tax.

A Sticky Legacy

At the time of his death in 1932 at the age of 70, William Wrigley had a net worth of $34-40 million. That’s the same as around $800-915 million in today’s dollars.

In 2008, 117 years after William Wrigley Jr. set out to make his fortune selling soap, Mars Inc. acquired his chewing gum company for $23 billion. With the sale, dozens of Wrigley family members made hundreds of millions, even billions of dollars. For example, today William Wrigley Jr. II, the founder’s great-grandson has a net worth of $3.2 billion and is one of the richest people in Illinois.

Go Deeper: Wrigley Wreal Estate

During his lifetime, the original William Wrigley owned mansions in Chicago, Philadelphia, Wisconsin, Pasadena, and Phoenix. He actually died at his 16,000-square-foot Phoenix estate, which is still known as the Wrigley Mansion, just a few weeks after construction was complete.

Outside of personal mansions, William was probably best known for his investment in an island off the coast of Los Angeles called Santa Catalina Island.

In 1919, William became the majority owner of all the land on Catalina. Thinking it could be a major tourist destination, he spent millions of his own dollars building infrastructure and attractions on the island. He also built himself a 10,000-square-foot hilltop private mansion, which he named Mt. Ada, after his wife. Today the home is a Bed & Breakfast called The Inn on Mt. Ada.

He built a hotel, laid utility lines, expanded the harbor and docks, and planted extensive trees and shrubs across the island. Most importantly, he built a waterfront entertainment complex called the Catalina Casino. Constructed at a personal cost of $2 million, the complex features a movie theater, ballroom, and museum. It was never a casino, as you might have assumed. The original/European usage of the word “casino” means a building used for social amusements.

For many years, the Chicago Cubs traveled to the island for spring training.

Upon his death, William decreed that Catalina be protected from major development so future generations could enjoy its beauty. In 1972, his son transferred 100% of the family’s ownership in the island into a permanent nonprofit conservancy.

Chicago:

In 1921, William completed construction on the now-iconic Wrigley Building in Chicago. The building passed to Mars Inc. at the 2008 acquisition. Mars sold the building in 2011. When you think of the Chicago skyline, you’re almost certainly thinking of the Wrigley Building:

FINAL WORD

On the next edition of “Deep Pockets,” I’m going to share a story that confirms what my ex-girlfriend already knew: size does matter.

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