Suffice it to say at this point, the offshoot merchants (and the trading companies they established) were a small minority of traders or exports. They did not threaten the dominant Company Of Merchant Adventurers, who obstinately stuck to their cloth exporting to northern Europe monopoly. This meant that cloth exporters in the Company of Merchant Adventurers were the leading players in English-Court external-foreign policy-making, and it was they who had to deal with the Crown’s meddlesome adventures and ambitions.
After 1560, however, English cloth export bounced about through to 1600 or so. Besides the ever-appearing foreign wars, in hindsight it is now evident that cloth demand had peaked–at least for northern Europe. Slow growth or stagnant exports, while still very profitable, frustrated, a small, but important to our purposes, English trading community, which in seeking for new opportunities, detached itself from the Company and attempted to open new geographies to English export previous to 1600. The new Adventurers had thirty years of experience, culminating with the incorporation of the East India Company in 1600.
That pleasure of having to embrace colonialization was not a particular problem for those that advocated the formation of a North American equivalent to the East India Company. The prospective venturers behind the London-Virginia Company real problem, and in 1606, they were not aware of that problem, was they did not understand what a permanent settlement colonization involved.
They did not anticipate the expectations that would be placed on their new Company as a consequence of founding a colony-plantation in the New World, nor did they appreciate the Company would be responsible, not only for installing an economic base sufficient to satisfy the objectives imposed on them by the Crown/Investors, but for settling–permanently– a plantation in the lands encompassed within their grant-charter. Specifically, how this settlement would be “governed” when settlement successfully was achieved, never entered their minds as they assumed such “governance” would be provided by joint stock corporation through its own internal decision-making authority, located, of course, a scant three thousand miles away. How each of those massive and complex functions could be managed by a joint stock corporation, driven by its investor ambitions and time frames, was not an obvious thought on their minds when they incorporated their two settlement projects in 1606.
With the death of Elizabeth in 1603, and the assumption of her throne by the Scottish King James I shortly after, these new commercial adventurers, after a suitable period to let James deal with his new job and its expectation, they began to press for the incorporation of a new, North American equivalent to the East India Company. James, by that time, was predictably broke, fighting Parliament, holding onto his now insecure Scottish subjects and their feudal lords, and managing an English economy, foreign policy, and internal cohesion fractured by religious polarization and fragmentation. Ruling from London, he was now surrounded by forces, dynamics and personalities—a new set of players in Crown and Court politics/policy-making. He needed to develop allies from groups who had several decades earlier chopped off his mother’s head. Who could he trust among the horde of lobbyists, advocates, self-seekers, dilettantes and his own family and past advisors?
As we discovered, the Virginia Company, in an effort to secure Crown support and resources in North America, proposed its own hybrid trading-settlement venture into Virginia. Little understanding what a permanent colony entailed in the wilderness surrounded by a hostile poorly economically developed by English notions, three thousand miles distant, they created a first rate disaster at Jamestown.
Faced with the fiscal crisis induced by James’ adoption of the Ulster Plantation strategy, with its forced compelled financing and participation by the merchant community, Smythe and Sandys decided to go it alone and implement as best they could their hybrid trading-export-agricultural/basic material economic base colony through a redefined plantation strategy with the Crown in 1612. After forging two charter revisions, the Virginia Company felt sufficiently empowered to go forward with their redefined colony-building-export trading development of a permanent Virginia settlement.
Once the English tackled the difficult project of colonializing North America and the West Indies, “plantation” was the English term for what we call a colony. The term “plantation” used in the context of English colonialism in the Tudor-Stuart era an approach, an economic development strategy nexus, that evolved during Elizabeth’s first ventures into her early mercantilist foreign contact and trade.
Its style of decision-making was by royal decree, management by the Crown administrative entities, a heavy use of court-confined granting and taking away of privileges, land and trading monopolies as private sector incentives. The integration of plantation into colonialization meant including the private sector into the strategy, but until 1603 the private sector was definitely the junior partner in the Tudor defined public private partnership. Use of physical coercion was never out of the question.
If one is thinking of today’s plantation, an agricultural manor with slaves, sharecroppers, and a medieval manor and society, the term at the time was “estates” of the noble and gentry classes. to colonization that reflected the paradigm in use during the Tudor-Stuart monarchies. Plantation, by its terms, meant a colonial process conducted by a privately managed, royally chartered joint stock corporation. That conceptualization seemingly worked well enough in the Far East, Levant, Russia, and even for the Flanders on the Continent. But when the first North American-focused English joint stock corporation attempted to create a “plantation-colony” in the New World, its numerous ventures fell on rough times immediately.
The Past
In 1606 James approved a charter creating the Virginia Company of London which presided over two separate groups of invested in two (subsidiary) joint stock companies (the London and the Plymouth Companies of Virginia). The charter did not come “out of the blue” as the history of varied joint stock companies previous to the Virginia Company will attest [99] Charles M. Andrews, the Colonial Period of American History (Vol. 1: Settlements), (Yale University Press, 1934, 1964), see Chapters II, III, and IV. English adventurers (that is what they were called) were interested in many geographies including Canada, West Indies, East Indies, the Caribbean, Africa and past companies had sought to organize trade with continental Europe. Slightly less known were the powerful Hudson Bay Company, and the British South African Company—both of which were remarkably successful, if you appreciate this colonizing thing.
“Adventurers” captures the flavor of a great deal of these efforts and initiatives; haphazardly organized, and loosely planned they blurred semi-military expeditions with trading opportunities, privateering, and focusing on trading posts not so much permanent settlement or a colony as we are discussing in this history. One might be well-served to watch some old Errol Flynn movies (Captain Blood, the Private Lives of Elizabeth and Essex, and Sea Hawk, for example), or even reread Treasure Island. Sir Walter Raleigh (Roanoke Virginia settlement) and Francis Drake were the leading characters in many of these adventures and most were conducted in Elizabeth’s reign. The shadow of war with the principal colonial power of the period, Spain (and Portugal also) cast its own input into the so-called colonial adventures.
During the years from 1555 to 1698, when the ‘company’ was the prevailing form of organized enterprise, these bodies controlled every variety of progressive business undertaking—domestic, foreign and colonial—and there was scarcely an industry or a part of the world in which they were not active. They carried England’s trade into the remote corners of the globe, they aided private ventures such as the search for the northwest passage, and they were responsible for the beginning of the colonizing movement in America [99] Charles M. Andrews, the Colonial Period of American History, p. 28.
Enter the Joint Stock Company—
The overlap between Elizabeth’s privateer-privately owned maritime shipping caused in large part by self defense in the war with Spain, gave way after to overlap with the second group of merchant-investors engaged in trade to Moscow, Mediterranean , and West Indies, Raleigh was perhaps the connecting link, with his interest in trade, privateering and colonialization–indeed his Roanoke charter titled him as “Governor of Virginia”. His settlement there was much more complex, and the robust board /investor members Raleigh “associated himself with nineteen London merchants as adventurers who were to contribute toward the expense of the enterprise and share its profits. Prominent among these were Thomas Smythe. The name of nine others appear both in this connection and among the adventurers of the Virginia colony [99] Osgood, Vol. 1., pp. 20-1.
A key takeaway is that there was little purity or consensus that underlie those merchant adventurers who practiced outside the dominant cloth-export trade of the Company of Merchant Adventurers. While they may have made investments in the Virginia Company, they ran and operated their trading and use of ships as they saw fit. The flux of merchant adventurers continued throughout the Virginia Company period–and decades after.
Interestingly, for example, one such an adventurer, a William Berkeley, joined with his brother John in the Dutch trenches and then spent time learning merchant trade while in Holland, during the early 1630’s. [99] Warren M. Billings, Sir William Berkeley and the Forging of Colonial Virginia (Louisiana State University Press, 2004), p. 10 He is destined to be Virginia’s most studied, and likely the most effective of her royal governors. Each adventurer company had its own goals, benchmarks, and business models. Conspicuously lacking in their goal-skillset, as noted by Andrews (p. 49) was their desire for “tillage” or farm or commodity agriculture. Previous to Jamestown gold and simple import trading was the predominant, if not exclusive object of their desire–privateering, trade and even gold were all encompassed in a trading post, single port “trading factory” which will shortly required much attention from the reader.
By the time of Elizabeth’s death in 1603, numerous voyages s of discovery, settlement/ exploration, and simple exploration followed. Naturally, the coast of North America attracted interest, and from the 1590’s through 1610, a variety of exploratory voyages were organized, several by individuals such as Popham, Sir Ferdinando Georges, and Richard Hakluyt, all of whose activities were loosely tied to the still surviving Raleigh (who died in 1618) and his charter. These explorations traced the coastline and suggested the vast forests (timber-related, and fur). and offshore fishing banks were valuable sources for import–which fit nicely into the import paradigm of our second group of merchant traders. Chief Justice Popham and Sir Ferdinando, Hakluyt, George Somers, a a son of Sir Humphrey Gilbert were destined to be Osgood’s “moving spirits” of the Virginia enterprise and the joint stock corporation. [99] Osgood, Vol. 1., pp. 24-5
Intersecting interests, drew in trading masters such as Thomas Smythe, and the trading activists of London, Bristol, and Plymouth among others. Compounding the future misery and polarization of the Virginia Company was also the inclusion of a goodly number of “adventurers” who often sailed using an Elizabethan “marque” who would continue to raid Spanish shipping after the 1604 peace treaty, a treaty which allowed the plans for Virginia to restart. In any event, several key Virginia Company investors (Robert Rich, later Earl of Warwick, John Delbridge of Barnstaple, and Marmaduke Rawdon, from London, who got wrapped up in the settlement of Barbados) [99] Andrews, Vol. 1, pp. 46-7.
The arrival of James I on the throne in London generated many emotions, schemes, ambitions and fears, but freed from the long reign of Elizabeth, many turned to the new king for his consent in their plans. His1604 treaty with the Spanish brought an end to a period trading disruption and commerce, which despite privateering had been hard on merchants, and on Crown finances. Recession and hard times hit the general population, as did plague and bad harvests–all of which intensified the anti-Crown activities of the Parliament. Hope for trading, and some sympathy for colonization, as avenues for generating prosperity permeated into the deliberations that commenced on the structure of a counterpart to the East India Company, the soon to be Virginia Company.
Though James I had no commercial sense and consequently no commercial policy, and in fact, exhibited little interest in economic questions of any kind, his Privy Council, which was almost the sole government agency in matters relating to trade and the plantations, gave support to the merchants, both in London and the outports, and the nobility and many lesser folk could usually be counted on to take shares in any undertaking that promised a financial return. Long experience in privateering and exploration enable shipbuilders to improve the sailing qualities of the merchant vessels … many ship captains had already seen service … before they employed or chartered for the peaceful and harmless pursuit of carrying colonists to America … Though the King brought up as he was in Scotland, had no knowledge of the impulses that were at work … and his relations with the merchants was neither practical nor tactful, nevertheless the years from 1604 to 1619 were characterized by peace, prosperity and confidence in England’s future. During this period were taken the first steps toward the permanent colonization of the West. [99] Andrews, Vol 1, p. 52
At the opening the peace with Spain (1604) not a single colony of Englishmen had found place in either Asia, Africa, or America. Before the end of the century, there were twenty colonies along the Atlantic seaboard, and in the West Indies, peopled by nearly two hundred and twenty-five thousand human beings of all sorts and conditions, chiefly of English stock, engaged in building up communities of active, vigorous frontier life–towns, villages, farms and plantations–and concerned with agriculture, industry and commerce. (pp. 53-5)
[99] Andrews Vol. 1, p. 44 footnote 1: Little would have been accomplished in the first half of the seventeenth century either in commerce or the settlement of colonies had the state been left to take the initiative, for not only were the early Stuart kings too deeply immersed in affairs at home to interest themselves directly in such undertakings, but their treasury was far too empty to warrant any expenditure in overseas enterprise. As a pathbreaking instrument at this time the private company or promoter was indispensable. That the privately settled colonies had to give way eventually before an expanding state control was inevitable, as the state grew in wealth and power and gradually formulated a program of its own, and as the needs of the whole overrode those of any of its parts. Hence arose in the history of the colonies, the friction, ill-will, and endless complications that accompanied English expansion …
The East India Company had achieved some success in its first few years and the idea of replicating that success in the west, as we mentioned earlier, attracted activist interest from Popham (then lord, chief justice of the king’s bench), Smythe (head of the East India Company), and Gorges (governor of the fort at Plymouth (England) came together and attempted to influence the king and his Privy Council especially, that along with an Irish plantation, a plantation in the west was both possible and desirable from a number of needs and perspectives.
In 1605, Popham representing the City of London, and Gorgas, the outports (Bristol, Plymouth and Exeter) wrote a petition to which a considerable number of activist adventurers (including Thomas Gates, George Somers, Hakluyt, Wingfield Raleigh Gilbert) added their names. They asked for a charter, incorporating two companies, one for London and the other Plymouth. The petition was probably presented to the King in the late summer of 1605 (before the Gunpowder Revolt). Ultimately, the King would accept it, and the Privy Council would negotiate its terms and devise the charter. [99] Andrews, Vol. 1, pp. 80-1. It is worth note that all of the above were knights of the Crown, along with a few merchants, and a minister-poet-geographer. Knights at the time belonged to the class distinctively to the English official [and] military [99] Osgood, Vol. 1. 1, p. 32,
As a suitable vehicle for the western plantation “Men of the Popham-Smythe type, with the example of the great trading companies before them, saw the value of employing a similar form of organization-the legal chartered company. for the purpose of advancing settlement as well as trade“. What they wanted at first was NOT a colony established by a private corporation, or a business joint stock company. Rather they the Crown lead the colonization effort, as a public initiative promised more success and commitment than any led by the private sector. The author of this missive is generally credited to an Edward Haics, who was an adventurer associated with Gilbert [99] Osgood, Vol.1, p. 25, footnote 1.
‘Where colonies are [founded] by a public consent [man] continewe in better obedience, and become more industrious then where private men are absolute [in charge] of a [voyage] for-as-much-better men of [be]haviour and qualitie, will engage themselves at a publique service than which carrieth more [reputation] with it than a private, which is for the most part ignominious in the end” [quote from Andrews, p. 74 from Alexander Brown, Genesis of the United States, Vol I, p. 37-8
This closely followed Raleigh and the founders of Roanoke who after the failure, insisted a private effort was inevitably doomed , and clearly urged that a private joint stock corporation would “enlist private capital” and empower the organized private company to carry out the colonization UNDER the CONTROL of the state (capitals mine) [99] Andrews, Vol. 1, p.74. While it is clear the merchant adventurers wanted to conduct the operations of colonization, the profound involvement of the Crown and King were preconditions for their success.
Raleigh’s Roanoke that had failed so badly. Raleigh learned his lesson: the settlement had to be a Crown led settlement and it had to chip in with actual funds if the venture was to work. We have seen that while this might have been a hope, the big kingly financial lightweight was in the midst of promoting a large colonization initiative in Ireland–not Virginia. James assumed a nominal control over the Virginia Company, but provided no funds–leaving that to the responsibility of the old merchant investor plan–good luck with that!
The merchants knew what they could bring to the colonization table: money to pay for it. But they needed the legitimacy and primacy of the the royal government to lend the character the endeavor so badly needed. Still, one cannot sidestep the reality of the day that without private sector investment of funds, colonization at that time would not get started. Andrews enthusiastically concurs:
But whatever the motor power that impelled [the English] to cross the seas, neither precursor nor pioneer, profiteer nor promoter, Pilgrim nor Puritan could have accomplished this purpose without the aid of the funds that had accumulated during this period in the hands of the capitalist classes of southern and southwestern England. It is true that the mercantilist groups were scattered and formed but a small part of the total population of the kingdom. But they were a power in the rising towns of the south–London and the outports of the West Country-and were working together towards common ends–the increase of wealth, the financial solvency of the state, and the glory of the kingdom. … English-America would hardly had been settled at this tie had not the period of [colonization] coincided with the era of capitalism in the first full flush of its power, an era which dates from the years of Elizabeth’s reign and of which we of the twentieth century may be witnessing the transformation or the end. [99] Andrews, Vol. 1, pp. 76-7
The reader may wonder why I lead off the story of the settlement of Virginia with a history of the English joint stock corporation. For a very simple reason, the settlement of Virginia was conducted by a joint stock corporation, and, BTW the so-called “government” of Virginia until 1625 was the same corporation. This was the traditional legal vehicle of these colonial/trading ventures (Roanoke was a joint stock corporation as well). As the reader shall see in the many pages that follow, it was corporate decision-making and governance that nearly ran Jamestown to the grave, but also established the proverbial legislature of American democracy: the House of Burgesses. But there is another reason, and that reason in the long run is more important.
It’s All in the Details: What did the Royal Charter Prescribe?
Reflecting the petition, there were two distinct “sub” joint stock companies created as subsidiaries of the conglomerate–which was the entity that was empowered by the King’s charter (signed in April 1606). England’s claim in North America was divided by parallels into a northern, middle and lower. Plymouth got the northern territory, Virginia got the southern, and the middle was left undetermined or unspecified. So from the start two separate colonies were to be founded. Andrews asserts “the creation of two companies instead of one was undoubtedly due to the intense rivalry which prevailed at this time between London and the outports, and to the jealously that existed among the West County ports because of commercial supremacy of London [99] Andrews, Vol. 1, p.83, footnote 1. The design, writing and setting the seals for the charter, did involve the King, his Privy Council, and most likely was dominated by the advocates who filed the petition.
The charter seems to have been forged with the sense it was not intended to be the permanent charter for either colony, but for a specific period in which the colony was established–in five years years several key provisions were to expire. These terms would have been incorporated into the bonds and indentures that were used to finance the voyages. Section 19, Osgood states seemingly did not prohibit grants of land to individuals by either of the two colonies, in neither colony during the period of the 1606 charter was it contemplated. Various other clauses support the assertion that only one port was to be created, and there would be no geographic dispersion outside a ten mile by ten mile boundary. The sub-corporations were given power to recruit and transport settlers/adventurers, and the right to trade.–but no mention was made of a monopoly.
Duty taxes were levied on trading transactions, and foreigners were to be taxed a higher rate for the first twenty-one years of the colony. While it was anticipated that funds would be raised through additional sub-joint stock corporations, the number was limited to three in the first five years. All trade within the colony would pass through (exported) a “magazine” (sort of company trading store), and imports would be handled by ‘three factors” chosen by the company. These seemingly pedestrian details will become important to the future evolution of Virginia’s domestic economic base, and the former restriction did complicate the supply of the settlement after the first expedition.
the [allowed] functions of the the patentees [the companies] … were proprietary, that is industrial and commercial in their character. This group of men furnished the capital for the enterprise, procured settlers, had immediate charge of trade, and expected a profit as a result of their efforts. … The colonies they founded were plantations , worked by servants [as customary for a plantation] and laborers under various forms of contract and managed by overseers or factors. [99] Osgood, Vol. 1, p. 27. As such the governing charter entered into areas of workforce, and contemplated at least two categories of recruits, freemen or servants (considered as property legally, and bound by a term contract)–what has come to be called indenture.
The Corporation was governed by three distinct “councils” (arguably equivalent to boards of directors). The first was resident in England, and the other two resident in each plantation. The more powerful council, resident in England, was entitled the “Royal Council” and it was intended to be the vehicle through which they King exerted control over both ventures, and their corporations. “To the Royal Council was given control of, and for all, matters that shall or may concern the government” in their respective territories. The King was empowered to appoint the members of the council (13 or 14), and in practice the King appointed only members from the patentees, but the King was free to adjust the size and composition of its membership as he pleased.
What this means is the “board of directors” for the conglomerate joint stock company–the Virginia Company–which managed the two subordinate joint stock companies (London and Plymouth) was a “royal” board, appointed by the King and responsible-accountable to him–not to the shareholders. While the King sidestepped the issue a bit by appointing the kingpins of the investor group, the potential for conflict between and among the investor group was built in to the conglomerate structure–and the limitations on the council’s ability to implement decisions without the King’s (Privy Council) approval meant a prolongated a more rigid-inflexible, and to the degree that minority interests could access the King, bias the decision-making. There is a question on the initial balance of public-private was not too tilted to the public–which, of course, is what the original merchant advocates wanted. But not everybody–certainly not those associated with the Plymouth Company. Andrews sees the problem:
Who was responsible for the idea of the Royal Council is far from clear. As Sir Thomas Smythe, Sir Walter Cope, Sir Francis Popham (eldest son of the Lord Chief Justice), Sir Ferdinando Gorges, and the sundry merchants of London, Plymouth and Bristol were among the first members of that council, it might be thought that the instructions as well as the first draft of the charter were the work of the original group of promoters. But as far as the West Country petitioners and merchants generally are concerned, this does not appear to be true [99] Charles Andrews, Vol. 1, p. 85
Andrews then goes on to cite a variety of Bristol and Plymouth public officials and merchants who were not onboard with the Royal Council, previous to the approval of the charter. They wrote to a “godfather” parliamentary official, Robert Cecil, with strong ties to the Parliament (for example, Edwin Sandys) for support against the Council, and indicated that they were not willing to go forward with any approval.
Andrews believes the lawyers of the Privy Council, including the great Popham, and Coke (a Commons activist), along with Bacon believed the King ought to maintain control over the Company responsible for England’s initial colonization–if only to (1) convey the civil and economic rights of those who emigrated to be equivalent to those who remained in England, and (2) since the precise location of the two colonies was not yet known, a set of issues could arise, some risking involvement by France or Spain, that necessitated the King keep a strong hand over the Virginia Company [99] Andrews, Vol. 1, pp. 85-6; finally, (3) they wished to be clear the land claimed by each colony within its borders was the King’s land, granted only by the charter and which could upon termination of the charter revert to the King.
This insistence of royal authority was congruent with the “plantations” founded in Ireland, and very much based on a view that the foreign trade, colonization, and settlement of North America was within the policy-making province of the King. In a real sense it was in “the spirit” of what will be called in a later module, a “regulated joint stock corporation”. That this was a hotly contested issue between Parliament and the King since 1604 (explanatory discussion will follow in a future module), only reinforces the Bristol-Plymouth appeal to Cecil as invoking the involvement of Parliament in the negotiations on the original 1606 charter. For various reasons, Parliament did not choose to enter into the process–in the aftermath of the Gunpowder Plot Parliament had backed away from its aggressive debate with the King, at least choosing to pick its fights carefully.
The decisions of the Privy Council were not challenged and accordingly the Parliament more or less deferred to the King, at least at that point, in the writing of the 1606 charter. Still, a warning bell had been rung. A series of progressively stronger rings was to follow.
The formal CEO of the Royal Council, however, was specified by the charter, which assigned as Treasurer Sir Thomas Smythe. Andrews further notes that while the London merchants seemed satisfied, the West County Mayor of Plymouth expressed dismay at the composition of the Royal Council which he described “as strangers to us and our proceedings” [99] Andrews, Vol. 1, p.85. In this criticism we may surmise the London commercial merchants was perceived by some in the Virginia Company, as operatives from London, and not sensitive to the agendas of the outports and West County.
Other correspondence regarding this topic includes dissidents from Exeter who threatened to not approve of the proposed draft charter (which might mean Gorgas himself in opposition either to the composition of the Royal Council, or the Council itself as an unwelcome intrusion of the King. A take away is there was real tension and separation between the activists of each of the two proposed colonies–and the root cause was London-vs non-London merchant adventurer rivalry. Also, London adventurers (cloth merchants particularly) were closely tied to the Crown, non-London merchants much less so, and more tied to Parliament.
The idea of a royal council and a Crown colony-led venture was likely not appealing to them, Once again, the 1606 Charter left Parliament out of the approval process; that made it even more a Crown initiative. The 1606 Charter had no role set for Parliament either in its approval or the design of its charter and governance. The King enjoyed considerable power in approving what today could be considered an executive order (which any succeeding king/queen could alter or revoke–and which could be terminated by him. The imposition of duties/custom or otherwise was a royal prerogative, one that in short order Parliament would contested (the impositions issue).
[A] great issue that aroused intense debate and at times great bitterness of feeling is the jealously which the outposts [non-London municipalities]—Bristol, Exeter, Newcastle, Hull, York, and others—felt toward London, a city which, having been influential in bring about the expulsion of foreign merchants [therefore creating a vacuum for municipal foreign trade strategy], was drawing the trade to itself and becoming rapidly not only a leader in commerce, but also an important factor in determining governmental, that is royal policy. …
Some of the outposts—notably Bristol and York—mercantile centers that were older than London—resented the latter’s determination to conduct business in her own interest, and to frame regulations that were to her own advantage. [The outposts] were aided in [this] struggle, partly because of the natural increase in trade … and partly by their growing importance in the House of Commons, which was the successful opponent of the King and Privy Council …
London had few members in the lower house, while the outposts had many, and the London companies having obtained their charters from the King were more or less bound to support him by loans and [their] influence. Mercantile interests were not a major interest of the house, who were largely the country gentry [landholders, not merchants] … but were content to [support] the outposts against the Londoners because in so doing they were supporting the parliamentarians against the king. [99] Charles M. Andrews, the Colonial Period of American History, p. 38.
What is remarkable to me, and interesting given our sub-state economic development focus, is the salience of inter-municipal competitive rivalries that reflected their own strategies on how to compete with larger cities and enhance their own economic base. As we shall see in this chapter, structural, strategy, and, of course, political culture distinctions between the two colonies hatched from the 1606 charter suggest he politics, rivalries and bitterness of English local economic development ambitions could so deeply affect the future economic and political development of Virginia is a wonder indeed–albeit indirectly, and over an extended interval.
So when the prospective American settlers prepared for, and set forth on their separate voyages, they were not compatriots nor all happy campers. Each followed their own schedule, financing, and decision-making. These strange bedfellows joined together to kick off this colonization thing, and their first set of initiatives were as much exploratory, even experimental, as opposed to permanent settlement. Most of their economy-related exploration was closely tied to a trading factory-hub so to set in motion a quick payment of bonds, and a fast dividend. The 1606 Charter was a means to an end–an end which was not yet certain. In essence the 1606 Charter was never written “in stone”; it was a transitional relationship–not a faithful replica of the East India charter.
As we shall see, the 1606 charter will be twice amended within five years, and in the two amendments exhibited a different policy-making process that did involve Parliament, and did more seriously and directly affect the structure, strategy and operations of the Virginia Company.
Thoughts and Implications–The Royal Council was, as Osgood relates, “the creature of the King“. [99] Osgood, Vol. 1, p. 28. Yet the King himself had little to do with it. To dot the “i”, this council was more a council acting in the king’s name, than a proprietary board of directors. In fairness, however the Privy Council and the leaders of the joint venture corporation did spend considerable time after the April approval to work out some details and draft specific instructions from the Royal Council, (i.e. make decisions to which the lower councils were to implement when resident in their respective colonies.
Through this Royal Council, the enterprise was rendered “public” with the operation of the enterprise entrusted, yet monitored by the Royal Council, to the two resident councils in America, with the operation of the colony in America, consistent with the directives/decisions of the Royal Council, bound by oath to England. The American-resident councils, however, were proprietary, private in character of their decision-making and the composition of the council, which could chose their president and fill such vacancies as may occur. Very detailed instructions, written by the Royal Council, as to limitations in judicial affairs, and in very precise detailing of the location and the workplan of the colony were sent with the expedition. Probably anticipated, but not to the extent the future revealed, settlement governance would enjoy at least temporary infusion of authority and autonomy given three thousand miles of ocean, and the harsh seasonality of winter travel.
But we ought take note of the special structure commanded by the 1606 charter. This was a royal expedition, governed and monitored by a royal council he appointed and could dominate at his volition. True the private sector put up the money, assumed the real risk, and tasked itself with the execution of a trading and settlement strategies. Given the rather detailed instructions issued to the local council, instructions that for the day may have verged on micromanagement, the decisions of local authorities were far from carte blanche–that nobody I could find these instructions were not warranted, or were not wise suggest no one really understood what they were in for in 1606.
In any event, the Virginia Company was a joint stock company was truly an experimental public-private partnership that deviated materially from past joint stock ventures. This seems to have been understood, as we have earlier mentioned the charter was not considered to be “permanent” but a transitory arrangement, meant to expire on its own terms after five years or so.[99] See Osgood, Vol. 1, p. 27. p. 29
The planning behind the Jamestown expedition, as described in our first module in the Virginia Chapter, reflected a perspective that the primary goals of early Jamestown were exploratory in nature, with trading, mining and fishing, Indian relations, not to mention installation of a permanent self-sufficient economic base, had to flow from the knowledge revealed from the explorations. From the start both colonies were dependent, almost totally on the supply ships to be sent on regular intervals.
What was not anticipated for sure, was the effect of the Ulster Plantation, then under intensive debate, would so materially affect the financing capacity of the Virginia Company. That will be evident in the push to get the bonds issued and purchased. We will discuss that in detail below, but it is in the financing that we see Thomas Smythe most clearly. He was very involved in that; he used his contacts, which at least among the guilds was mixed. But he did likely bring over investors from the East India Company. The planning for the first expedition, he left to relatives and friends. There is little sense Smythe got much involved with that; he was, if the fog of history is not so thick as it may be, a great delegator–which explains how the managed so many diverse and serious responsibilities simultaneously.
To me it is apparent that in 1606, the rush was on to get the charter approved, secure the king’s involvement, protect the interests of the two competing parties, and get the boats loaded and sent off to North America as quickly as possible. The Charter was approved in April,1606, but the final detailed boundaries, letters of instruction, and other necessary documents were not in place until November. The Jamestown expedition arrived in May, 1607, having left England in December, a trip of 144 days). The Plymouth Company backed “Popham Plantation” (Maine) or Sagadahoc as it is known today, arrived later, after a two month voyage, in August of the same year. The timing of Sagadahoc proved to be a disaster, and was, as much as anything responsible for its quick fate. Bluntly, there was not a lot of time to get the finances in order, and the planning, recruitment, ship leasing, and supply purchase to be completed, especially for Jamestown (about two months).
Impact and Salience of the English Joint Stock Corporation in the Jamestown Venture
The English joint stock corporation, in one or another of its four varieties, was the principal public private enterprise in colonial America—and its use continued into the mid-1840’s Early Republic. In many forms and names, we will return to this organizational structure many times in our history. Structures matter, even if “structuralism” is quite out of favor in academic circles. As we shall see two modules from now, the Virginia Company will be converted through charter modification to a more conventional, private joint stock corporation, sans its1606 infusion of partnership with the Crown.
A great deal of the activities, programs and strategies will be made by this organizational vehicle, or implemented by it. This will include the structure of American colonial municipalities. cities towns, and counties, as well. Moreover, in New England especially, local government, towns in most cases, were not incorporated, and in settlement they formed a voluntary version of the corporation and its shareholders became the members of the “town or Municipal Corporation” upon which the fabled New England town democracy was based. Economic developers should take note of the joint stock corporation because it was the principal EDO of colonial America and the Early Republic. In Virginia, however, as we shall see the relationship of the private sector to the political and economic structures will be quite different from Massachusetts. To that we can thank the Virginia Company.
Accordingly, we should at this point recognize one of our earliest and most important inheritances from England was that organization vehicle, which served as the backbone of English-American colonial life and development. It certainly was for the Jamestown and Virginia colony-building. That corporation did not last long, but long enough to be both midwife and mother to our first state.
The 1606 Charter “Strategy Nexus”: Not too Clear on the Concept
In Virginia. the distinguishing feature of the Charter’s instructions to the resident Jamestown council was its clear linkage to the “plantation” form, and, given its exploratory role, a restriction against dispersion of the population into the hinterland–at least temporarily. The trading factory mentality did take hold sufficiently to perceive Jamestown as less a capital of a settlement colony than the hub of exploration, trading, and resource development– a hub that was easily defended, and adjacent to open waters to facilitate access by supply ships. There was in the charter no power to create local governments. “Dispersion of the colonists was not contemplated. The establishment of a single fortified post, which should serve as a center for exploration, for the discovery of mines, for trade with the Indians, and the exploiting of the resources of the country for the support of the colonies and the benefit of the adventurers” [merchants] [99] Osgood, Vol. 1., p. 33
Osgood correctly observes the company proprietors “being at the outset merchants or knights, and noblemen who were acting under the commercial impulse, they were guided, as we have said to the experience of older commercial companies … Though they were under direction from home, yet the colonists must in the main provide for their own defense, develop relations with the natives, give spirit and extension to the institutions of government … Then economic interests were of prime importance, and the connection [i.e. the link] between [company goals] … and the colony was especially close“, [99] Osgood, Vol 1, p. 31,
Since no one really knew what settlement required, most of the planning for the first expeditions were based on past exploitive-mining-trading opportunities that realized quick (almost one off) profits that could within a short time pay off/substantially reduce the investor’s loans in the expedition.
To avoid the failures of the past, the patentees of 1606, especially the London group, drew from their own commercial experiences the chartered trading company as the model for managing their enterprise. The trading company minimized the financial risk to large and small investors alike. It also allowed for the investment of service [i.e. labor] as well as capital. Thus men who had no money, but who were willing to trade their labor for a share of the profits, could perform a vital service in the operation. Finally the trading company could bring together the talents and expertise of specialists, providing thereby a fund of information and skills that could further enhance the chances of a successful adventure [99] “the Beginnings”, the Old Dominion in the Seventeenth Century: a Documentary History 0f Virginia, 1606-1689 (edited by Warren M. Billings (Institute of Early American History and Culture, University of North Carolina Press, 1975), p. 4.
Indeed, the investor (five year term) loans were due for pay off in 1611—at high interest. It also meant that those settlers who could not pay their way became (unpaid) employees of the Company—a practiced that continued through 1614. I could argue the settlement strategy nexus was incompatible with this financial structure. One posits the expeditions were doomed from the start; but the 1606 Jamestown expedition was exploratory (as was the Sagadahoc expedition). Settlement was a strategy in process in 1606. They clearly did not focus on the bigger picture of colony-building in the North American wilderness in the short interval from final approvals to ships sailing of the horizon.
One of the expedition’s apparent purposes was the establishment of a permanent settlement, but perhaps its first concern was erecting an outpost as a means of determining how the further exploitation of Virginia should proceed. The exploratory nature of the undertaking seems to be confirmed in the additional instructions [Document 4: 1606 Instructions from the London Company to First Settlers] [This will also explain a great deal of John Smith’s activities while in Virginia] [99] Warren M. Billings, “the Beginnings”, the Old Dominion in the Seventeenth Century, pp. 4-5
The “joint stock company” was the most effective combination of powers and was the preferred alternative for larger and sustained trading-settlement ventures. It required a royal charter, but in return a “monopoly” for trading in a particular geography was granted. It was this monopoly that caused the controversy among local municipalities, because once granted by the King/Queen, the other communities could not join in the fun and profits. London, the biggest and the bully on the block, usually got the best deals. The joint stock corporation was best suited to raising large amounts of capital in multiple issuances. This was because its flexible membership required as an entrance “fee” the purchase of a stock subscription which was the basis for the corporation’s capital raising. More capital, more members (or shareholders).
Members were anyone who bought the prescribed amount of capital, and that meant one did not have any restrictive qualifications on who could join—and that by default led to members whose principal motivation was making a profit, usually in the shortest time possible. The profit came in the form of a corporate “dividend”. That the 1606 colony was a sub-corporation of a master corporation, controlled by appointees of the Crown (in the Royal Council), a quick return of the original investment was sought and was essential to participation in future bond issuances.. There was nothing, however, in the structure of a joint stock corporation that required a rapid return of investment or dividend (bonds were to expire in 1612,1613), only the motivations of the investor did that. English investors in the early 1600’s were not known to be “patient capital”. It was, however, risk capital in that these colonizing adventures were just that: risky dangerous adventures.
The problem for the company with its commitment to a series of supply ships–the lifeline of the Jamestown colony–was that each, being a separate venture, required by the conventions of the day, to form a new sub-company specific for that purpose. That new corporation would issue a new bond for that supply voyage. Sort of a “pay as you go” process. Each additional subscription (bond issuance), however, meant more members, enlarging the company’s voting membership, and potentially attracting individuals with ambitions not in sync with company management who could vote in future elections. It was also time-consuming.
In that both colonies were “plantations, owned, officered and managed by the proprietors of the company … [and] the colonists [i.e. the workforce] were servants [indentured by contract] to the company … fed, housed out of products of the total labor of the colony, supplemented by cargos of provisions received from [England]. When, if ever, the colony became able to furnish a surplus product … it was sent home in the vessels of the company and sold for the benefit of the adventurers” [99] Osgood, Vol. 1, p. 34. This meant the Virginia Company had to cook breakfast, lunch and supper for whoever was alive over there. Those fine folk were, among other tasks, the ones who were supposed to find the exports that would pay for that supper in the form of the next supply ship. As one reads through the convolutions the colonists/their resident council went through to find stuff to send back for sale one understands they did so not for colonist personal profit, but for both the corporation fiscal stability as well as for their supper. Jamestown exports to England were an essential part of the Virginia Company’s very fragile financial plan.
The reader ought commit these realities to memory, as they underlie life, politics, economics, and society in the colony–at least to 1612 or more realistically to 1619.
Membership, the Investors in the Virginia Company
The initial expedition was financed relatively quickly–Smythe and the King’s involvement greased some wheels sufficient to send off three ships and 104 colonists. The financing of the Virginia Company followed the traditional formula of Elizabethan merchant trading companies, i.e. an amazing small and closed group of investors purchased such shares as they deemed appropriate to their commitment to the project. Rabb’s study uncovered that in 1606 the Virginia Company attracted twenty-two investors–many overlapping with East India, Muscovy and Levant [99] Theodore K. Rabb, “Investment in English Overseas Enterprises, 1575-1630 (the Economic History Review, New Series, Vol. 19, No. 1), see p.78 Table. See below for a more extended discussion of this matter.
That these colonists required a seemingly never ending series of supply ships and replacement servants (because of the death rate) the immediate task was to send off the first expedition and wait until reports of its success could be used to start the process for funding the first supply ship — and so on. Any glitch or outright failure would crush the next financing effort. Unsurprisingly, Rabb reports that between 1607 and 1608, only nine additional investors signed on to the Virginia Company. [99] Theodore K. Rabb, “Investment in English Overseas Enterprises, 1575-1630 (the Economic History Review, New Series, Vol. 19, No. 1), see p.78 Table
With only three bond issuances allowed by the charter, corporate expenses and costs that followed the settlement also had to be financed–making the sums larger and the need for an expanding investor “pool”–or rather deep pockets from a few wealthy investors. The latter was never expected. Even Smythe was not on board for that. Baron De La Warr (we shall talk of him in this module series, he was the first official governor) was, I believe the largest single investor in Virginia. Small wonder that after him, three of his four brothers were to be governors as well–continuing to 1642.
Invested money bought shares in the company, and that granted right to vote in corporate elections, serve on corporate “committees”, and participate in some form in corporate decision-making. Over time, this had to dilute the dominance of the original investors. Eventually, to stop the flood of unrealistic investors making corporate decisions led the company to seek to raise funds through municipal lotteries, a controversial approach to public fundraising in and of itself. A lottery conducted by, and the funds expended on the behalf of the Virginia Company, a “monopolistic trading companies, invited a toxic reaction from some quarters of both Parliament and public opinion. We will deal with this later, but from 1606 on, a series of new subsidiaries were incorporated and issued bonds to finance the company’s activities. This created a very tight-fisted, clumsy, illiquid fiscal structure for the company. It also likely made inevitable a very early restructuring of the 1606 charter.
Bond issuance at the time of the East India and Virginia Company was by subscription, i.e. an individual purchased or subscribed to a portion of the total issuance, often paying over a series of installments. While the first installment had to be paid, subsequent installments, if not paid, would negate the subscription and terminate any owner’s rights to the company, offered as a term and condition of the subscription. This detail concerning installments was much more than that; it became a very serious problem for the Virginia Company as years elapsed, and as expectations of dividends and profits faded. When one issued a bond, therefore, the tendency was to overcommit and induce more investors to pay the first installment sufficient to meet the costs of the proposed supply expedition and estimated company expenses. This is no way to run an airline today, and it was not helpful to a 17th century maritime trading company.
Indebted as I am to Professor Theodore Rabb who has complied a study of investors into the English trading companies during the period 1575 to 1603, I offer an intro into the 1606 corporate membership. Rabb’s database offers the comparison of the Virginia Company to investors in other trading company’s like the East India, as well as provide us a looksee into who invested in Virginia. [99] Theodore K. Rabb, “Investment in English Overseas Enterprise, 1575-1630, The Economics & History Review, New Series, Vol. 19, No. 1 (1966), pp.70-81
Up to and including 1606, the paradigmatic approach to English trading companies had as few moving parts as possible. The more investors, the more partners, the more partners less profit for each, and its baggage was more egos and disparate goals to undermine consensus in decisions. Stuart kings inherited a financing paradigm dominated by a few investors who invested only what they needed to acquire a ship, stock it with people and supplies and have it sail off into the sunrise. To describe how the British East India Company was financed ,Rabb describes, Sir Thomas Smythe’s early 20,000 pound subscription to the East India Company–a huge sum for an individual, but with an investor membership of only eighteen investors. By way of hint into the future, one can see how “closed” these joint stock corporations were, and that access by the many to opportunity to profit from overseas ventures was nonexistent. [99] Theodore K. Rabb, “Investment in English Overseas Enterprise, 1575-1630, The Economics & History Review, New Series, Vol. 19, No. 1 (1966), pp.70-81.
The 1606-8 Virginia Company (including both sub-corporations) attracted only 31investors (the East India in this period, 29). Obviously, the Virginia Company’s 1606 (and 1607-8) bonds were purchased by a few investors raising larger sums. [99] Theodore K. Rabb, “Investment in English Overseas Enterprise, 1575-1630, The Economics & History Review, New Series, Vol. 19, No. 1 (1966), see Table 1, p. 78.
The secret as to how this could work is simple: each voyage sponsored by a merchant trading company was limited in purpose, and relatively low in costs–within the means of a relatively few investors. A voyage of several ships, and an unknown series of future voyages, with each bringing a new infusion of people–a permanent colony–was a brand new business plan, and that meant a new financial plan. Neither happened in 1606 as we know. The financial-investment plan behind 1606 used the “old” merchant investor model, and milked the usual suspects for subscription.
Each of the two subordinate trading companies (London and Plymouth) were expected to raise their own funding through the purchase of shares in their corporation. Both the charter, and the Privy Council instructions were silent on how to do so. So likely each company formed its own sub-corporation; Andrews believes “each company assumed a corporate character in order to provide a common stock from contributions of its own members. There is nothing to show where the public was invited to purchase shares. For this reason the organization was rather a semi-joint stock variety than the joint stock, as each voyage [including supply voyages] were expected to pay for themselves” [99] Andrews, Vol. ., p.88.
As Andrews also comments this method of financing had its risks; a failure or something perceived as a failure would almost certainly condemn the entire enterprise to its fiscal death–whatever was really going on in America. Indeed, he goes on, with, I think, considerable justification, that “from the outset [this fiscal structure and] the form of control provided by the charter was not well adapted to promote a successful colonizing movement” [99] Andrews, Vol. 1, p.88 . Hindsight is nearly all to be sure, but it at minimum suggests the first charter was at risk in its origins, and for whatever the reason, the guiding leadership had not thought through what colonization entailed. As we shall later see, even after a bad start, it would take two full years for the light to dawn in the [London] Company leadership as to what they needed to do to establish a colony–not a trading factory.
In any event, as was the pattern a trading company advocates, tapped its knights, nobles and merchants who were interested in a colonial venture, and wealthy knighted subscribers were the bond purchasers. One was a Keeper of the Tower of London, and another the son of the Lord Chief Justice. In American histories these folk are usually referred to as “gentlemen”, but the reality was they were key policy-makers-implementers of Elizabeth’s mercantilist and early imperial ambitions and now were adapting to being the loyal subjects of James I. Those people who were blamed for not earning their keep, were the sons of these wealthy folk, looking to get the experience of a trading factory, and to set up shop in Jamestown for further adventures. That is one reason why these entitled, little skilled youngsters, born to the manor so to speak, made such fine candidates for mob rule and starvation.
Different investors wanted different things. One influential investor Richard Hakluyt (who BTW went to Jamestown) wanted to stress colonialization, i.e. a permanent settlement and installation of an economic base that yielded returns like that of Spanish gold mines. Others wanted to convert the Indians to Protestantism—we are in the middle of the English Protestant Reformation. Others wanted a port from which English trade routes could be secured. [99] https://encyclopediavirginia.org/entries/virginia-company-of-london.
The explanation behind investor interest in the initial Jamestown expedition is its centrality in the popular culture of its day which is more than hinted at in Shakespeare’s 1605 play ‘Eastward Ho!”. Specifically citing Virginia, the play relates “I tell thee golde is more plentiful there than copper is with us … Why man all their dripping pans and their chamber pottes are pure golde … and as for rubies and diamonds, they go forth on holy dayes and gather ‘hem by the seashore to hang on their children’s coats and sticke in their cappes’. This theme ironically appears to have had more effect than the modern tourist theme “Virginia is for lovers” [99] Virginius Dabney, Virginia: the New Dominion (University Press of Virginia, 1971), p. 7. Today, I can read the equivalent in a Robinhood chat room. Merrie Old England is still around.
So now we are ready to explore more deeply the establishment of the Virginia- London Company
How Board Politics/Mindset Affected Virginia-London Company’s Decision-making
The case I have developed in the previous module was the (1) England was reshaping its mercantilist goals-initiatives to pivot away from its quick profit-extractive-trading and privateering company adventurers to the settlement of a permanent colony. The player/intermediary in this shift was the joint stock corporation entrusted by charter with the venture.
(2) the Virginia-London Company bore responsibility for the success of the New World adventure-settlement as it included two subsidiary companies, one tasked with Virginia and the other for Massachusetts. (3) The initiative in Massachusetts (Sagadahoc) conducted by the Plymouth Company went belly-up by 1608; the Virginia settlement (1607) was launched following similar instructions as Sagadahoc; in both colonies, decision-making structures, goals and procedures as Sagadahoc ran into similar troubles almost immediately.
Remembering the several month delay in communication (meaning four months in a two way communication), the Virginia Company and its two subsidiaries crossed paths during 1607, and it was not until 1608 that the leadership of the Virginia Company became fully cognizant their investment had failed completely in one location, and was on the verge of collapse in the other. With the Plymouth Company enveloped in a fatal crisis, it fell to the leadership of the London Company to save itself.
The principal co-founder of the Company, Sir Thomas Smythe in 1606 delegated the operation, design and details of the Virginia expedition to several relatives and their friends. It was they who were the onsite leadership of the venture. Several would go to Virginia in the initial 1606-7 voyage. One, Wingfield, was in charge in Jamestown—or so Smythe thought. As the events in 1608 unfolded it was Smythe that had to assume leadership and mount a corporate restructuring of the London (and Plymouth), and Virginia Company. Accordingly, with the fate of Virginia, Jamestown and England’s first settlement initiative in Smythe’s hands, it is appropriate to outline the man, his values, past experiences and the politics he faced in his effort to restructure as he literally attempted to weather the perfect storm that had hit the companies.
James, the sovereign and master of the Virginia Company, no matter how hard he tried, was not having fun. In 1604-5. He was the target of the Gunpowder Plot (Guy Fawkes), immersed in a major conflict within the Anglican Church, and suffered major push back from the English in general from his attempt to be King of both England and Scotland. His war with Parliament over budgets, expenditures and the role of Parliament in each was a first order clash that rocked the politics of England—a clash that got worse and persisted through the decade, indeed much longer. The beleaguered Virginia Company, itself a compromise between his constituency (Smythe and the London merchant community) and the major city constituency of Parliament, adopted a new strategy, a new corporate structure with the king in charge and they responsible for the initiative.
Not well known today was that the Plymouth subsidiary launched its expedition after the Jamestown expedition, using terms and instructions (including the method for selecting the local council and its appointees in a secret letter). Both expeditions, although with different boards of directors responsible and supervising, followed the same mishmash of goals, and were subject to the same intra-company politics. The Plymouth Company headed up north, to Massachusetts and settled in Maine and established a “settlement” on the mouth of the Sagadahoc River close to present-day Bath Maine.
But the damage had been done!
Two expeditions had been sent over, and one failed and the other not far from failing. By the end of 1608, much had changed in London within the London Company especially. Almost 300 souls had been sent to their fate since 1607 in the first two initial expeditions alone. In Jamestown alone, half of its mid-May residents had died by the early fall of 1607. It soon became clear that it would take years, not months, to reform and restructure the London Company—and the impact of national issues and politics would again enter into the decision-making and restructure picture.
Up to the end of 1608, the various companies, their leadership, boards, and investors, had not clearly thought through their goals: short term exploitation and trading, national goals and interests, or permanent settlement. The London Company, with a very unclear sense of what the latter involved, realized that settlement was the basic and primary strategy, and the first notions of self-sufficiency and settlement strategy, functions and requirements had reached into the company’s decision-making processes. Relief ships were sent out to stave off Jamestown implosion but reform and restructure proved elusive for several years. In that bleak and sad interim Jamestown residents were effectively doomed and reform efforts inched their way into Virginia by 1610, leaving Jamestown to a fate not unlike the Donner Pass pioneers.
Within two years it went belly up—for virtually identical reasons the settlement of Jamestown nearly did (although the death of two key board directors/investors appear to have been determinants for the eventual decision to abandon the colony). History only tells the tale of the winners, and Sagadahoc and the Plymouth Company lost out, mostly because its corporation board factionalized and decided to call it quits. The in site experience of the colonists was very much the same, and was duly noted and reported by verified reports back to the boards.
The rights of the Plymouth Company were later sold to other investors. Ten years later they launched their own colony, which settled on Cape Cod. We now refer to them as the Mayflower founders of Plymouth Massachusetts. Long-term victory does not always go to the swiftest; Jamestown no longer officially exists, Plymouth sure does.
Thomas Smythe: a Taste of the Times
Thomas Smythe was blessed to be a descendant from a three or four generation merchant family. Since the days of the War of Roses his grandfather had been chief “haberdasher of the Port of London”. Gramps combined an amazing portfolio of public and private offices, access to royalty, and private wealth–and passed it on to his children. Thomas’s father, Customer Smythe, was almost a pure merchant, who accumulated “enormous wealth” and that too was passed on to our Thomas.
Unlike this father, [Thomas] is not to be found in the forefront of those merchants who dabbled extensively in government financial concessions. But there can be no doubt about his pre-eminence in the world of Jacobean [the era of James I] commerce. Governor for fifteen years in all of the East India Company, he was also in his time governor of the Russia, French, Levant, Virginia and Somers Islands [Bermuda] companies. Smythe was to become one of James I’s most trusted allies in the business world, and the government made extensive use of his talents, not only in his capacity as governor of so many great chartered companies, but also as a member of government commissions, including the navy commission in 1618, and the treasury commission in 1619. [99] Robert Ashton, the City and the Court, 1603-1643 (Cambridge University Press, 1979), pp. 16-17
Thomas inherited a social, economic and political standing that included membership in Parliament; he was Auditor of the City of London, the Sheriff of London. It was Thomas Smythe that bought out Sir Walter Raleigh’s Virginia charter and led the financing effort to send it on its way. In his later years, Smythe was responsible for several major expeditions attempting to discover the proverbial Northwest Passage.
Caught up in palace and merchant intrigues in the turbulent aftermath of Elizabeth’s death and James ascension to the throne, Thomas was imprisoned in the Tower of London for alleged improprieties. For his own reasons James I released, and quickly knighted him. Smythe had become a key member of James’s “Court Faction”. That this might have involved a financial transaction from Smythe to James is not known, but there is every reason to assume Smythe lent funds to the King, and Smythe’s finances were deeply affected by his support of the King.
In 1604 Thomas was named “Special Ambassador” to Czar Boris Godunov. Assuming responsibility for the negotiations of the Muscovy Company with the Czar, Smythe also played a major role in ending the war with the Netherlands in the same year. When he got back, he commenced the Virginia Company incorporation—which from the start was a project that its proponents believed depended on the King’s support. He was only partially successful, but the King did assume at least nominal leadership in the North American venture.
Smythe, deeply involved in the court intrigues, and a likely participant in James’s struggle with Parliament which was ongoing and becoming bitterer with each passing day. No doubt, the far-reaching and quite controversial activities of the British East India Company and Muscovy Company necessarily consumed much of Smythe’s attention. Virginia was not the only item on his plate. That is why his deputy, Sir Edwin Sandys, son of the powerful Archbishop of York during the reign of Elizabeth, played such an important role in the affairs of that Company when Virginia ran into trouble after 1609.
By that time he influenced the Muscovy Company, and was Founder and the First Governor of the infamous British East India Company (a position he held, with one break, through 1621). In the background at first, he worked through relatives, he was the principal co-founder and future Treasurer (i.e. President) of the Virginia Company (and the London Company) through 1621. It was Smythe who was the vital link between Crown and the Company board and membership.
Judging from his escapades with the better known British East India Company, his style of action and administration was swashbuckling to authoritarian, but behind the scenes, perched in his statesman like commanding heights. Mixing personal profit with pursuit of national interests, in his later years the Virginia Company, in his mind, was the western hemisphere equivalent of the British East India Company–full of opportunity, and ill-formulated hopes. In his case what he did not know about North American colonization did come back to hurt him.
Ron W. Coan 