William Warren Gibbs: The Rise and Fall of A Gilded Age Promoter

William Warren Gibbs arrived in Philadelphia around 1880 with little more than a smooth tongue and gas-making equipment for sale.  Born in 1846 in the small town of Hope, New Jersey, Gibbs dropped out of school to work in a local store, and then married Frances Ayres Johnson, the daughter of a prominent Hackettstown merchant.  Not content with a life in central New Jersey farm country, he wanted to move to the thriving “Workshop of the World “and become a wealthy entrepreneur.

Soon after arriving in Philadelphia, Gibbs quickly gained a reputation as one of the most persuasive men in the city, able to sell anything to anyone, especially influential men with money. Those around him realized that Gibbs had a real knack at setting up companies and issuing securities. He teamed up with another up-and-coming Philadelphia businessman — Peter Arrell Brown Widener — and formed the United Gas Improvement Company, a massive trust that sought control over the city’s gas mains.  Another vested interest in UGI was W.G. Warden of John D. Rockefeller’s powerful Standard Oil Company.  The arrangement worked well for Widener, who parlayed the fortune he gained supplying meat to the Union Army into trolley lines and new real estate development in North Philadelphia.   By the 1890s, UGI had helped make Widener and his cronies extremely wealthy.  According to contemporary reports,  UGI was “the most successful enterprise of its kind in the country, already owning and controlling the gas works of about fifty important towns and cities.” That year, the outstanding stock of the United Gas Improvement Company was worth $5 million and sold “at a high premium, while the actual assets will aggregate at a much larger sum.” Eventually, the United Gas Improvement Company solidified its position by getting a 30 year lease on Philadelphia’s entire gas lighting system.  It also had a reputation for political corruption. In 1903, for example, UGI was accused of making an illegal $20 million profit on the sale of stock in the United Electric Company of New Jersey.

The business and social bonds between Peter Widener and William Warren Gibbs probably explain why they owned neighboring mansions on North Broad Street during the 1880s– Widener at 1200 and Gibbs at 1216.

In 1888, Gibbs struck pay dirt again when he trotted out the Electric Storage Battery Company, which made batteries for industrial uses. According to business historian Alfred Chandler, Gibbs “quickly worked out an agreement with leading Philadelphia capitalists to raise $4.0 million” in 1893, much of it from Widener and Elkins, who needed batteries to power their electric streetcars. With this money, Gibbs purchased several smaller companies and bought out patents belonging to Brush Electric, Edison Electric, and other American electric manufacturers.” He then supervised the creation of a network of factories and distributers to manufacture and sell these electric batteries to big clients such as General Electric and Westinghouse.  The company proved to be a great success, bolstering its organizer’s reputation and enriching him further.

Yet Widener and Gibbs’s paths diverged by the early 1900s.  Widener invested in companies for the long term, branching out into steel, oil, and steamships (including his friend Clement Griscom’s International Mercantile Marine — owner of Britain’s White Star Line ).  By 1912, when Widener lost both his son George and grandson Harry in the Titanic disaster, he had a highly-diversified portfolio worth over $100 million. William Warren Gibbs, on the other hand, remained a serial entrepreneur, and had little interest in active management in his start up’s affairs after it went public.  He became known — perhaps somewhat mockingly — as the man who sat on more boards of directors than any other man in America.  One his more far-fetched schemes was financing the construction of a massive bridge across the Hudson River at Poughkeepsie. Although the structure was a wonder of engineering, the bridge company itself went into receivership and left Gibbs $100,000 poorer, and had “cost lots of big men big fortunes.”   This misadventure probably deepened Gibbs’s lack of respect for engineers.

By 1900, William Warren Gibbs had amassed enough clout (and a $15 million fortune) to purchase a mansion from banker Anthony Drexel Jr.  at 1733 Walnut Street, on the northeast corner of Rittenhouse Square.  The house, built in 1847 when Rittenhouse Square was on the edge of the countryside, was now surrounded by some of the finest homes in the city,  Gibbs and his made their own lavish improvements to the house, which already boasted ceiling frescos, plaster moulding, solid walnut doors, and gold and silver leaf stenciling.  They also added a high iron fence, gate, and a new stone port-cochere at the rear of the house, and a raised portico at the Walnut Street front door.  Mr. and Mrs. Gibbs, as well as their five children still living at home, enjoyed the most modern amenities: electronic service bells to summon five live-in servants, steam heat, hot and cold running water, and gas lighting.  He joined the Union League, his wife threw lavish parties at hotels, and his young boys William Francis and Frederic Herbert learned how to play tennis at prestigious suburban country clubs.  Their eldest daughter Augusta May married the son of a prominent banker in 1899, and a local paper described her as “a splendid musician [who] paints beautifully and rides and drives well.”

Yet Gibbs’s inability to invest in a company for the long-term finally caught up with him.  He invested in more and more peculiar ventures — dye, gunpowder, and cellulose battleship insulation —  and seemed more interested in playing the market than creating sustainable companies that actually made things.  The Philadelphia Inquirer observed in 1901 that, “the days of skylarking for these stocks are over, and lacking the support of Mr. Gibbs, each issue is heavy in the market.  Not, so far as is known, are they likely to receive any support which will make them attractive as speculative issues, stocks which a person may buy and sell quickly at a handsome profit…” The same article also noted due to some suspect financial activities, “It is quite likely that some of the shareholders of record of the Alkali Company unite in a defense and make a test case.”