Today, names like Jeff Bezos, Warren Buffett and Bill Gates are synonymous with “wealth”. For the Medieval world, the name Jakob Fugger had the same implications. Yet, adjusted for inflation, Fugger was richer than Buffett, Gates and Bezos combined!
Indeed, Jakob Fugger was so rich that he was known as “Fugger the Rich” to distinguish him from his father, who was still quite rich and shared his son’s name.
Even in a time when kings, emperors and dukes were the richest men in the land, Jakob was far richer than they were, so much so that he became their personal bankers, increasing both their fortune and his own…
Establishing The Family
In 1367, almost 100 years before Fugger the Rich’s birth, his grandfather, Johann Fugger (sometimes known as Hans Fugger), would flee poverty in his home village of Graben, Bavaria by moving to the Imperial Free City of Augsburg.
That year, Johann Fugger would marry Klara Widolf, one of the daughters of the Master of the Weavers’ Guild, thus giving him Augsburg citizenship.
Upon her death in 1378, Fugger would marry again, this time marrying Elizabeth Gattermann, in 1380, also the daughter of a Master of the Weavers’ Guild. Through this marriage, Fugger would also gain admission to the guild.
Through his membership in the Weavers’ Guild, Johann Fugger would become quite rich, buying raw materials and selling them to weavers, before buying their finished products and selling them at a huge markup.
Doing this, soon made him one of the richest citizens in Augsburg!
Having had three children (three daughters) with Klara, Fugger would have a further four with Elizabeth, including two sons: Andreas Fugger (born 1394) and Jakob Fugger the Elder (born 1398).
Upon Johann’s death in 1408 or 1409 (sources differ), the business would pass to his wife, Elizabeth (as his sons hadn’t come of age yet) who’d run the family business until her own death in 1438, where it would pass to her two sons.
Inheriting the business, Andreas and Jakob would initially work together, soon having the fifth largest fortune in Augsburg, before a dispute in 1454, split the family in two. This would see both brothers set up on their own…
Early Life
After splitting their family business in two, Andreas would soon grow his half of the fortune immensely, using his fortune to acquire a seat on the Augsburg City Council, eventually being granted a coat of arms depicting a jumping deer.
This would see Andreas’s branch of the Fugger family be called the “Fugger of the deer” (German: Fugger vom Reh).
His brother Jakob, however, would expand his business more cautiously. Whilst still becoming as affluent as his older brother, Jakob would take his time, thus ensuring that his family’s fortune would remain intact after his death (unlike his brother’s!)
Just as with his brother, Jakob would also be granted a coat of arms, this time depicting two lilies, with his branch thus being known as the “Fugger of the lily” (German: Fugger von der Lilie).
It was into this prosperous family, the Fuggers of the Lily, that the future “Fugger the Rich” would be born into.
Born on March 6 1459 to Jakob Fugger the Elder and his wife, Barbara Bässinger, the man who’d eventually become Jakob Fugger the Rich would be the tenth of eleven children (and the youngest of the couple’s seven sons).
As the couple’s youngest son, Jakob II (as he was known), was never expected to take over the family business (instead, that was his three eldest brothers: Ulrich, Georg and Peter).
Jakob II, on the other hand, was groomed to become a member of the clergy (as was common for the youngest sons of well-to-do families of the day).
Life in Venice And Return
Despite the death of Fugger the Elder in 1469, his wife would take control of the business until her sons came of age, just as Fugger the Elder’s own mother had done decades prior.
Yet, the death of his father wouldn’t change the in 1473, a 14-year old Jakob would be sent by his mother, to study ecclesiastics in Venice.
However, the death of his older brother, Peter, in 1473, saw Jakob’s fortune change immensely. Told to abandon his priesthood, Jakob II was told to stay in Venice to learn banking and bookkeeping and to join his family’s firm (now called Ulrich Fugger & Bros).
Staying in Venice from 1473 to 1487, Jakob would learn the ins-and-outs of the Venetian banking industry, as well as modern Italian-style bookkeeping (rather than the German-style of bookkeeping involving haphazardly placed receipts).
Whilst in Venice, Jakob would also be introduced to the European precious metals trade, in particular the European silver, quicksilver (mercury), lead, gold and copper as well as the European slate trade too.
Beyond learning valuable skills like banking and bookkeeping and gaining an interest in the European metal trade, Jakob would learn to read, write and speak several foreign languages, including French, Latin and Italian (Venetian) beyond his native German.
Completing his studies in 1485, Jakob would be given a 29% stake in his family’s company.
Founding a Mining Empire
Soon after this, Jakob would travel to the silver mines in the Salzburg Slate Alps. Realizing that these mines needed funding to continue their operations, Jakob would step in and lend them the money they so desperately needed.
Instead of demanding the usual documents that proved the mines owed Jakob money, Jakob instead asked to become a shareholder in the mine, with his repayments to be paid in silver at a vastly reduced rate. To the mine owners, this was a great deal.
For Jakob Fugger, this was an even better deal.
You see, the money Jakob generated from his first few mines was loaned out again to more mines in the Salzburg Slate Alps, where Jakob once again became a shareholder. Within a few years, Jakob was a shareholder in most of the silver mines in the Slate Alps!
With his loan repayments being paid in silver at a rate less than market value, Jakob was able to ship the silver to Venice, where the Fugger brothers were able to sell it at a 50% markup, thus netting the family millions of dollars in today’s money…
Meeting The Habsburgs
Having generated a sizeable fortune from the silver mines in the area, Jakob would be introduced to Sigismund, the Habsburg Archduke of Tyrol (the cousin of then-Holy Roman Emperor Frederick III who had granted the Fuggers their coats of arms).
As ruler of Tyrol, Sigismund had been instrumental in establishing and promoting his country’s mining industry (including giving out the rights to establish many of the mines that Jakob owned).
Naturally, this made Sigismund as much money as it did Jakob. Unlike Jakob, however, who invested the money he earned, Sigismund spent it faster than it was coming in, owing to his overly lavish lifestyle, several illegitimate children and expensive construction projects.
Due to this, Sigismund had turned to the Habsburg family’s usual financiers for funding. Initially happy to lend Sigismund money, he soon amassed huge debts that he hadn’t paid off yet.
As such, they refused to finance him until he had paid them back.
Hoping to pay back his debts and continue to fund his extravagant lifestyle, Sigismund invaded the Italian state of Venice, 1488, whilst the Venetian army was fighting the Ottomans.
However, before he could levy taxes on his new citizens, Venice would issue a decree: Pay reparations of 100,000 guilders and leave, or face annihilation.
Not wanting to risk a costly war with Venice (which he wouldn’t win as he couldn’t pay his troops), Sigismund left and turned to his financiers for help. As you can imagine, they all refused due to Sigismund’s extensive pre-existing debts.
Seeing an opportunity, Jakob Fugger offered to finance Sigismund in exchange for the exclusive rights to all the copper and silver in Tyrol’s mines.
Further Habsburg Dealings
Financing Sigismund was undoubtedly a risky deal for Jakob. Whilst lucrative, Tyrol’s mines are provided the Archduke with the silver he needed to mint coins that he could then use as money.
Without access to those mines, Sigismund had no way of producing new coins without Fugger’s help (which Fugger was willing to do). If push came to shove, Sigismund would’ve likely had armies seize the mines, thus screwing over Jakob.
However, Jakob saw that there was a powershift happening in Europe. The Habsburgs were becoming more and more powerful, and would need bankers like Jakob to fund their exploits. To Jakob, the risk was well worth it.
Through saving Sigismund, Jakob was introduced to other members of the Habsburg family, most notably Frederick III’s son and co-regent (since 1486), Maximilian I, at a Frankfurt fair in 1489.
Upon Frederick’s death in 1493, Maximilian would become King of the Romans (not Holy Roman Emperor), with Jakob serving as his personal banker.
Even with the financial backing of Jakob Fugger, Archduke Sigismund’s mismanagement of public funds (eg. Fugger’s money) and lavish lifestyle soon began to cause civil unrest, resulting in the Archduke’s resignation.
This resignation spelled doom for Fugger, who feared that the next Tyrolean leader would strip Fugger of his mining rights. Fortunately, the archduchy or Tyrol passed to Maximilian I, who allowed Fugger to keep his mining rights.
Monopolizing The Mining Industry
In 1494, at Jakob’s insistence, the Fugger brothers’ company would be formally incorporated, with the (formerly Ulrich Fugger & Bros) becoming Ulrich Fugger of Augsburg & Bros to show that all three brothers were equal.
Despite this, Jakob Fugger was by far the wealthiest of the Fugger brothers, with most of the company’s mining deals having been negotiated, struck and signed by him personally, with no mention of his brothers.
Aside from this, Jakob would loan more money to Maximilian, who in return paid Jakob with the exclusive mining rights in Upper Hungary (as Maximilian was also the hereditary King of Hungary).
By doing this, Jakob not only gained more silver mines, but also gained all the major European copper mines (as Hungary had the largest copper mines in Europe at the time, which were now all operated by the Fugger family!)
Fugger’s mining business would expand rapidly through establishing a number of smelting plants across modern-day Austria and Hungary, as well as manufactories in Buda, Kraków, Leipzig and Breslau.
Through this, Fugger was able to ship his copper and silver to all of Europe’s major ports at the time, stretching from Lisbon in Portugal to Venice in the Venetian Republic (now Italy) to Danzig (Gdańsk) in the Kingdom of Poland, Trieste in Slovenia and London, England!
At its height, Jakob Fugger would have a near-monopoly on Europe’s copper market, whilst having significant power in the European silver market too.
Bankers to The Pope
In 1500, the Pope decided to rebuild much of Rome which had fallen into disrepair due to the Avignon Papacy. In particular, Julius II wanted to rebuild a newer and grander Sistine Chapel, St Peter’s Basilica and other grand buildings in the Vatican.
Not having the money to fund this himself, the Pope would borrow vast sums of money to not only build the physical buildings, but decorate them in as much gold as possible, alongside works by the likes of Michelangelo.
To fund this, the Pope would turn to the churches of Europe. Still not having satisfied this, the Pope turned to the Christian bankers of Europe to help. Who offered to loan the Pope the money? You guessed it, Jakob Fugger…
As one of the most expensive building projects ever, Jakob loaned the Pope tens of millions of dollars in today’s money for the construction. The loan agreement between Jakob and the Pope would see the Pope pay Jakob back in 18 years’ time.
When that time came, the Pope (then Medici Pope Leo X) didn’t have the funds to repay Jakob. To raise them, Leo X began selling indulgences (essentially a “get out of hell free card” for anyone able to buy them) to pay back Jakob.
Inadvertently, this would lead to the Protestant Reformation.
Prior to this, Jakob Fugger would deal with Leo X’s predecessor, Julius II, financing his formation of the Swiss Guard in 1506.
Fugger’s experience as a mining tycoon also saw him lease the Roman mint (known as the Zecca) in 1508, producing 66 different types of copper, silver and gold coins for four different popes, all of which are highly prized by collectors today!
The Fuggers would own the lease from 1508 until 1524, when the Sack of Rome (Sacco di Roma) destroyed the Zecca entirely.
It was through these loans and contracts with the Church that Fugger was able to convince the Pope to repeal the ban on Christians issuing loans with interest (which had been banned centuries prior).
Opposition From Martin Luther
As the richest man of his time, even in a time before things like newspapers and the internet, Jakob Fugger was not free from criticism.
In particular, Jakob Fugger would catch the ire of reformer Martin Luther.
For Luther, Jakob had put undue financial stress on the Church. You see, Jakob knew that the Church didn’t have the money to pay him back, yet he refused to extend the loan, even though he claimed to be a devout Catholic and to love the Church.
By doing this, he had essentially forced the Pope (Leo X) to start selling indulgences, which even the most devout Catholics thought was abhorrent. Leo X even admitted that without Jakob, he would never have sold indulgences.
It was the sale of indulgences that caused Luther to write his famed 95 Thesis, and thus kickstart the Protestant Reformation.
However, Jakob also earned Luther’s ire due to his perceived control over Maximilian I (as Maximilian had begun treating Jakob’s wealth like his own piggy bank, with Jakob charging him handsomely for it).
Luther also claimed that Jakob was soliciting favors from the emperor, although there’s little evidence to support this.
Jakob would continue to earn Luther’s ire due to his wealth. Whilst not a major issue, Luther had hoped that as Jakob was not a king, that Jakob would use his money to help the poor.
Although Jakob established the Fuggerei (the world’s longest-used social housing complex) in Augsburg in 1516, it was seen by Luther as only a minor concession by a man who bankrolled emperors and popes and was the richest man of his time.
Starting an Overseas Trading Empire
In 1497, Portuguese explorer, Vasco de Gama, would return to Portugal after having become the first European to successfully reach India by sea.
Although it may not seem like much today, navigating by sea allowed Europeans to transport more gold on the way to India (to purchases the spices with) and more spices on the way back (thus making the trip more profitable).
All whilst they didn’t have to worry about being robbed, injured or even killed (which, whilst rare, did occasionally happen).
Owing to it being a rather lucrative trade, and already having the connections from his time in Venice, decades prior, Jakob Fugger would establish a manufactory in the Portuguese capital of Lisbon in 1503.
Given permission to trade spices, pepper, pearls, other rare gemstones and luxury goods, Fugger would soon control much of the Lisbon spice and gemstone markets, making Fugger even richer (and more importantly, famous) than he already was!
Owing in large part to Fugger’s role in the copper trade (with copper being a valuable Portuguese export to India), Fugger would soon come to dominate the trade, giving himself the best possible deals on copper, whilst selling it for a premium to other traders.
Despite having expanded his other businesses quite rapidly, Fugger chose to expand his spice trading business much slower, after having seen families like the Welsers (another rich, noble German banking family) almost bankrupt themselves through bad trades.
All in all, Fugger’s spice trading business would only be a minor side business when compared to his main banking and mining businesses (even if this side business was a mulitbillion dollar enterprise by today’s standards!)
Becoming a Nobleman
Whilst Maximilian I was not a dynamic monarch by any means, the Habsburg realms (that is, the areas of land controlled by the Habsburg family) were expanded greatly under his reign.
Going from just Austria in the late 15th century, the Habsburgs would acquire the kingdoms of Spain, Bohemia (modern-day Czechia) and Hungary by the early 16th century, all through advantageous marriage arrangements.
As for Jakob Fugger, he’d fund all of it.
In dire need of funds to have himself crowned Holy Roman Emperor, Maximilian would sell the minor Habsburg-owned counties of Kirchberg and Weißenhorn, as well as the nearby lordships of Wullenstetten and Pfaffenhofen an der Roth.
Looking to expand his social standing, Jakob Fugger would acquire these titles for 50,000 guilders, which the Fugger family would keep until 1806 (when Napoleon Bonaparte dissolved the counties and lordships of the Holy Roman Empire).
Thanks to this, Maximilian was able to crown himself Holy Roman Emperor.
Hoping to raise more funds, Maximilian would sell the manor of Schmiechen in 1508, and the lordship of Biberbach in 1514.
Although minor lands for Maximilian and his family’s huge empire, the acquisition of these lands was huge for Fugger, giving him not only a higher social standing, but also the rights to the local mines, thus increasing his considerable wealth even more.
However, Fugger didn’t expand his wealth without problems however. In early 1510, local noblemen in Augsburg began interfering with the Fugger family’s businesses, thus harming their ability to finance the Holy Roman Emperor.
To get around this, Maximilian I would raise Jakob Fugger to nobility in 1511 with the title of “Baron”, before raising him to the title of Imperial Count in 1514, thus preventing the local noblemen from interfering with the Fugger family’s businesses.
Relationship With Charles V
Five years after raising his close friend and personal banker to the nobility, in 1519, Maximilian I would die at the age of 59. Bequeathing all of his lands to his grandson, Charles (then also the King of Spain), would create great tension in the Holy Roman Empire.
As the title of Holy Roman Emperor was an elected title (that was usually inherited), several other European kings (including Francis I of France and Henry VIII of England) would stand for election of the title.
Risking losing his entire fortune if a non-Habsburg monarch became Holy Roman Emperor, Jakob Fugger was forced to back Charles and his claim to the imperial throne.
With 850,000 guilders (550,000 of which were funded by Jakob himself, whilst the rest was funded through loans from the Welser family and several Italian banks), Jakob was able to bribe the seven prince-electors to elect Charles unanimously.
Doing this put both men in deep trouble.
For Charles, he had racked up huge personal debts to Jakob so he could become Holy Roman Emperor, whilst Jakob Fugger had sunk much of his family’s fortune into getting Charles elected, destabilizing it somewhat.
To help pay back his loans, Charles would help expand the Fugger family’s mining operations by giving them rights to new mines in Spain, particularly giving them exclusive rights to the mercury and cinnabar mines in Almadén, southern Spain.
Death
Despite having had a long and happy marriage to his wife Sybille Artz (with the pair marrying in 1498, when he was 40 and she was 18), the couple had no children.
In 1525, a now 66-year old Jakob Fugger would bring on two of his nephews, Anton and Raymund, both the sons of Jakob’s elder brother, Georg. Doing this essentially made Anton and Raymund his heirs.
And this was just in time as well, as Jakob Fugger, or “Fugger the Rich” as he was known, would die on December 30 that year, most likely of natural causes.
His firm would then pass on to Anton and Raymund, with Anton doubling the family’s wealth by 1546.
At the time of his death, Jakob Fugger had a total net worth of 2,000,000 guilders, roughly equivalent to between 2 and 2.2% of the entire GDP of Europe at the time (by comparison, John D. Rockefeller had a net worth equivalent to 1.5% of the US’s GDP!)
If you were to adjust for inflation, Jakob’s net worth would be worth anywhere from $221 billion to a whopping $400 billion!
Legacy
One of the largest legacies Jakob would actually nothing to with his immense wealth, but rather, the Protestant Reformation that he helped start.
Without his loans to the Pope, the church would’ve never sold indulgences, and thus, Martin Luther would’ve never broken from the church. Thus, without Fugger, modern history as we know it would look incredibly different…
To honor the richest man to have ever lived in Augsburg, the city have erected literally hundreds of statues of him throughout the town, with it being impossible to navigate the city without seeing a statue of him.
Similarly, the German government have also honored him by placing a bust of him in the Walhalla museum in Regensburg (unveiled in 1967) and a statue of him in the Bundeswehr Military History Museum in Dresden.
Interestingly, in 1525, Jakob Fugger would acquire the mercury mines of Almadén, in southern Spain. The Fuggers would continue to own the mines in Almadén until 1645, when they were sold.
Centuries later, these same mines would be acquired by Nathan Mayer Rothschild, who would similarly have a monopoly on the European mercury trade, as well as a multibilllion dollar fortune to match Jakob Fugger’s!
How Can I Replicate What Jakob Fugger Did?
Reading about the incredible life and wealth of Fugger the Rich, you’re probably wondering how you could replicate what Fugger did, so that you yourself could become one of history’s richest people!
Sadly, replicating what Fugger did would be almost impossible.
For starters, Fugger made most of his money through lending the Habsburgs, then the monarchs of the Holy Roman Empire. As you have probably guessed, the Holy Roman Empire no longer exists, and today’s Habsburgs are a shell of their former selves.
And most of the rest of the world’s monarchs are the same.
Whilst the British royal family, or the Spanish royal family or the Bruneian royal family are rich by any standards, they have long-established relationships with people who can maintain and increase their wealth, such as the Rothschilds and the British monarchy.
Chances are that you don’t have that (sadly).
Instead, you’ll have to think a bit more abstractly if you want to replicate what Jakob Fugger did.
For example, the Habsburgs were a rich family, but had very little money skills. Families like that still exist today. Perhaps you could act like a private bank, by lending money to them, whilst also using their immense wealth to increase your own!
What Can we Learn From Jakob Fugger?
Despite having been dead for almost 500 years, the life of Jakob Fugger is still quite useful for the modern world, being able to teach you not only about running/starting your own business, but also about life in general too!
Give Back
As one of the richest businessmen to have ever lived, Fugger could’ve quite easily sat back and enjoyed counting his gold coins (which he minted himself, because he was that rich!)
Yet, he didn’t.
Instead, he saw that whilst he was incredibly wealthy, many in Augsburg weren’t so lucky. In fact, many were struggling to put a roof over their heads, let alone put food on the table for themselves and their family.
Seeing this, Jakob would fund the construction of the Fuggerei in 1514, a social housing complex that could house Augsburg’s neediest citizens. Do you want to know something cool about the Fuggerei? It’s still in use today!
With a symbolic annual rent of one Rhenish Guilder (roughly €0.88), and three daily prayers for the Fugger family, the Fuggerei can house well over 300 people in 67 apartments. And best of all? The Fugger family still run it, over 500 years later.
Don’t Let Critics Get You Down
Having amassed one of the largest fortunes in history, through hundreds of complicated, yet lucrative deals, it probably doesn’t surprise you when I tell you that many people disliked Jakob Fugger immensely.
For many within the Catholic church, they acknowledged the good he had done through expanding the Holy Roman Emperor’s power, and rebuilding the Vatican. However, they also acknowledged that he only did this for self-serving reasons.
In other words, he didn’t do this out of piety, but only to increase his own wealth.
Others, such as the famed Martin Luther, believed that Fugger had unduly exercised power over the papacy by forcing them to sell indulgences, or by lifting the ban on lending with interest, which partly led to the Protestant Reformation you learned about in history class!
Even after the establishment of the Fuggerei, critics like Martin Luther continued to critique almost every aspect of Jakob Fugger’s life, proving that no matter what you do, you’ll always make more enemies than friends in life…
Make Powerful Friends
At the time of Jakob Fugger’s birth in 1459, the Fugger family already had existing relationships with then Holy Roman Emperor, Frederick III, who’d they’d provided loans to in the past (and who had granted both sides of the family their coats of arms).
Learning from his uncle and father, Jakob would similarly make powerful friends, starting with Archduke Sigismund, before turning to Maximilian, and later Maximilian’s son, Charles. He was even on good terms with the Pope too!
Through these advantageous friendships, Jakob was able to offer his services as the personal banker to his land rich, yet cash poor monarchs (as the Pope is the King of the Holy See), allowing them to continue to live lavishly.
In return, Jakob was able to not only increase his own wealth considerably, but was also able to acquire untold power and fame in his lifetime (even if his fame has dwindled since his death)!
Found a Dynasty
Having already come from a respected merchant family, it was expected that Jakob Fugger would expand his family’s textile business and pass it on to the next generation, who were expected to do the same (and so on so forth).
It’s safe to say that Jakob Fugger went above and beyond on this mandate, establishing a huge empire that cemented the Fugger family as the richest non-regal family in Europe for several centuries.
Despite not having kids of his own, Fugger was determined to found a dynasty, using his nephews Anton and Raymund (the sons of his older brother, Georg). In turn, this allowed him to establish a dynasty.
Indeed, it wasn’t even in Jakob’s lifetime that the Fugger family’s net worth would be at its highest. Instead, that would be in 1546, with the family’s wealth being spread among many members, before the family’s loss of fortune in the mid-1600’s.
Expand Cautiously
Following the family split between uncle and his father in 1454, his uncle would expand his wealth at an incredibly fast pace. However, this wouldn’t last, with his uncle’s family going bankrupt in 1499 due to a bad loan.
This would greatly impact the young Jakob, instilling in the young boy a need for caution.
Even whilst expanding his multibillion dollar empire (by modern terms anyway), Fugger would expand his overseas trading business quite cautiously, always making sure to consolidate his previous holdings before acquiring more.
By expanding cautiously, Fugger was able to expand his wealth during some of the most turbulent times in history – the Medieval period – a time when wars between two small fiefdoms were commonplace and often wrought havoc on trade across Europe!
This would also allow Fugger to ensure that even in death, the Fuggers of the Lily would still be among the richest citizens of Augsburg. Indeed, even during WWII (nearly 17 generations later!) the Fuggers would still be living off the money Jakob earned!
Has the story of Jakob Fugger inspired you? Tell me in the comments!
