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John Pierpont Morgan Sr. (April 17, 1837 – March 31, 1913), also known as J.P. Morgan, was an American financier and investment banker who played a significant role in the formation of several prominent multinational corporations. Among these was General Electric, which was created through the merger of Edison General Electric Company and Thomson-Houston Electric Company in 1892. Morgan's interest in electricity began with his financing of Thomas Edison's Edison Electric Illuminating Company in 1878, and he went on to back Edison's lighting experiments through his support of the Edison Electric Light Company.
| Characteristics | Values |
|---|---|
| Date of formation | 1892 |
| Founders | J.P. Morgan, Thomas Edison |
| Merging companies | Edison General Electric Company, Thomson-Houston Electric Company |
| Headquarters | Boston, Massachusetts |
| Main offices | 30 Rockefeller Plaza, New York City |
| Former names | Drexel, Morgan & Co., Edison General Electric Company |
| Current divisions | GE Vernova, GE Aerospace |
| Former divisions | GE Plastics, GE Appliances and Lighting, GE HealthCare |
| Employees (as of 2007) | 70,000 |
| Revenue (as of 2007) | $17.7 billion |
| Ranking in 2020 (by gross revenue) | 33rd |
| Ranking in 2023 (in Forbes Global 2000) | 64th |
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What You'll Learn
J.P. Morgan's interest in electricity
John Pierpont Morgan Sr. (April 17, 1837 – March 31, 1913) was an American financier and investment banker who played a significant role in corporate finance on Wall Street during the Gilded Age and Progressive Era. As an influential figure, he was instrumental in forming several prominent multinational corporations, including General Electric.
In 1889, Morgan played a pivotal role in merging Edison's company with other entities to create the "Edison General Electric Company." This merger laid the foundation for what would eventually become General Electric, a powerhouse in the electrical industry. Morgan's involvement in the formation of General Electric underscores his forward-thinking approach to emerging technologies and his influence in shaping the trajectory of American industry.
In addition to his interest in electricity, Morgan was also intrigued by wireless communication technology. In 1900, he was convinced by inventor Nikola Tesla that a trans-Atlantic wireless communication system was feasible. This system, based on Tesla's theories of Earth and atmospheric electrical conduction, would surpass the short-range radio wave technology of the time.
Beyond his contributions to electricity and communication, Morgan held controlling interests in numerous American businesses, including railroads, insurance, and manufacturing. His influence extended across various sectors, shaping the economic landscape of the United States during a pivotal period in its industrial history.
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Thomas Edison's role in General Electric
Thomas Edison is known for his role as the founder of General Electric (GE). In 1876, Edison, then 28, set up a laboratory and machine shop in a single two-story building in Menlo Park, New Jersey, which he called his "Invention Factory". This is recognised as the world's first research and development (R&D) facility.
Edison's entrepreneurial ventures and business acumen led to the formation of around 14 companies, including GE. In 1878, financier J.P. Morgan financed Edison's Edison Electric Illuminating Company. In April 1889, with the backing of the Vanderbilt family and Drexel, Morgan & Co., a bank co-founded by JP Morgan, Edison merged several companies to form the Edison General Electric Company.
Edison's company was involved in the War of Currents, a battle to supply the electricity for the World's Fair in Chicago in 1893. The event's organisers chose George Westinghouse's alternating current system over Edison's direct current transmission lines. Edison's anti-AC stance was well-known, and he believed that the high voltages used in AC were dangerous. Following this loss, Edison sold his stake in General Electric in 1893. He then invested the money in an enterprise designed to supply iron ore to US steelmakers.
In 1900, Edison created the General Electric Research Laboratory, devoted to original research to help the company innovate and maintain its competitive edge.
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Drexel, Morgan & Co.'s support in the merger
John Pierpont Morgan Sr. (aka J.P. Morgan) was an American financier and investment banker who played a significant role in the formation of several prominent multinational corporations, including General Electric (GE).
The original Drexel, Morgan & Co. was founded in the mid-1800s by Anthony J. Drexel and his partner, J. Pierpont Morgan. In 1892, Drexel, Morgan & Co. supported the merger of Edison General Electric Company and Thomson-Houston Electric Company to form General Electric. This merger was a pivotal moment in the history of GE, as it brought together several leading electric ventures, including Thomas Edison's company, which was backed by J.P. Morgan.
The role of Drexel, Morgan & Co. in the merger extended beyond financial backing. J.P. Morgan, as the head of Drexel, Morgan & Co., brought his extensive experience and connections in the financial world to facilitate the merger. He had a keen interest in new technologies, particularly in the field of electricity, which aligned with GE's focus. Morgan's influence and reputation in the business world likely contributed to the successful combination of these companies.
Following the merger, GE continued to grow and expand its operations. It was incorporated in New York, with its headquarters in Boston, Massachusetts. Over the years, GE diversified into multiple divisions, including aerospace, energy, healthcare, lighting, locomotives, appliances, and finance. The company's success and influence were such that it ranked among the largest firms in the United States by gross revenue on the Fortune 500 list in 2020.
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J.P. Morgan's other companies
J.P. Morgan & Co. is an American financial institution founded by financier J.P. Morgan in 1871. The company has historically specialized in commercial banking, investment banking, asset management, and private banking. Over the years, J.P. Morgan has been involved with various other companies and ventures, including:
Drexel, Morgan & Co. (1871)
J.P. Morgan became a partner in the New York City firm of Drexel, Morgan & Co. in 1871. This firm soon became the predominant source of U.S. government financing and was reorganized as J.P. Morgan and Company in 1895.
Northern Securities Company (1901)
J.P. Morgan was involved in the creation of the Northern Securities Company, which merged three of the most important railways in the Midwest: the Northern Pacific Railway, the Great Northern Railway, and the Chicago, Burlington, and Quincy Railroad. However, this merger was opposed by President Theodore Roosevelt, who considered it a violation of the Sherman Antitrust Act of 1890. The Supreme Court eventually dissolved the company in 1904.
U.S. Steel (1901)
In 1900, J.P. Morgan began negotiations to purchase Andrew Carnegie's steel business and merge it with other steel, coal, mining, and shipping firms. This led to the formation of the United States Steel Corporation, the world's first billion-dollar corporation.
General Electric
J.P. Morgan played a significant role in the formation of General Electric, one of several prominent multinational corporations he helped establish.
International Harvester
Along with General Electric, J.P. Morgan was instrumental in the creation of International Harvester.
Aetna, Western Union, Pullman Car Company, and Railroads
J.P. Morgan and his partners held controlling interests in numerous other American businesses, including Aetna, Western Union, the Pullman Car Company, and 21 railroads.
JPMorgan Chase
J.P. Morgan & Co. is now a subsidiary of JPMorgan Chase, formed when Chase Manhattan Bank bought J.P. Morgan in 2000. JPMorgan Chase is the largest banking institution in the world and has made numerous acquisitions, such as Bank of New York Mellon's retail and small business banking network in 2006.
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General Electric's modern-day divisions
John Pierpont Morgan Sr. was an American financier and investment banker who played a significant role in the formation of several prominent multinational corporations, including General Electric.
General Electric Company (GE) is an American multinational conglomerate founded in 1892 and incorporated in New York. Over the years, the company has had multiple divisions, including:
Aerospace
In 1986, GE acquired the NBC television network through its purchase of RCA, formerly a subsidiary of the company. GE owned NBC until 2011 when it was acquired by NBCUniversal and Comcast. GE Aerospace is now the aerospace company's legal successor.
Energy
GE Vernova, the energy company, was formed as a result of GE's final split. GE Vernova includes Power, Wind, and Electrification businesses, supported by its accelerator businesses in Advanced Research, Consulting Services, and Financial Services.
Healthcare
GE HealthCare, the health technology company, was also spun off from GE in 2023.
Lighting
In 1911, GE absorbed the National Electric Lamp Association (NELA) into its lighting business, with headquarters at Nela Park in East Cleveland, Ohio. The lighting division has since remained in the same location.
Locomotives
John Flannery, who became CEO in 2017, divested General Electric's assets in locomotives to focus the company more on aviation.
Finance
General Electric also had a financial capital division, which was sold off following the Great Recession of the late 2000s.
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Frequently asked questions
No, but he was a major player in its creation. In 1892, J.P. Morgan's company Drexel, Morgan & Co. supported the merger of Edison General Electric Company and Thomson-Houston Electric Company, which formed General Electric.
J.P. Morgan believed that electric light would become a must-have utility and make him richer than his rivals. He was also interested in the new technology after financing Thomas Edison's Edison Electric Illuminating Company in 1878.
Yes, J.P. Morgan was an American financier and investment banker who dominated corporate finance on Wall Street during the Gilded Age and Progressive Era. He was involved in the formation of several prominent multinational corporations, including U.S. Steel and International Harvester. He also had controlling interests in numerous other American businesses, including railroads, Western Union, and the Pullman Car Company.
General Electric became one of America's biggest corporations and was at the forefront of innovation for decades. The company expanded into multiple divisions, including aerospace, energy, healthcare, lighting, locomotives, appliances, and finance. In 2023, GE split into three separate businesses: GE HealthCare, GE Vernova, and GE Aerospace (which took on the General Electric name).
