Gold made Otago New Zealand’s wealthiest and most populous province. By 1870, one-third of exports came from Otago, and one-quarter of the country’s population lived there.
Dunedin’s entrepreneurs were influential in shaping the city’s economy. Some came from Scotland, some from England, and some from Victoria, Australia. They usually had some business or craft experience, and knew there was more, or at least steadier, money selling to miners than being a miner.
The typical 19th-century Dunedin entrepreneur was born in the 1830s or 1840s and came to Otago in the early to mid-1860s. By the mid-1870s his business was well-established in Dunedin and nearby parts of Otago. By the 1890s the company had a national distribution network. Some Otago businesses went international.
Commerce proved a field in which ethnic minorities could make headway. Bendix Hallenstein, who was Jewish, came from Victoria in the 1860s and started a retail business in Queenstown. He was based in Dunedin from the early 1880s, running both the family business and the Drapery Importing Company (DIC). His companies traded New Zealand-wide by the early 20th century. Other Jewish business families included the Felses and the Theomins. The Farrys, who worked in the clothing business, were from Lebanon. Chinese in Otago moved from being gold seekers to market gardeners around Dunedin. The Chinese Sew Hoy family went into the clothing business.
Union Steam Ship Company
The most successful and adventurous entrepreneur was James Mills. He worked briefly for the businessman Johnny Jones, and by the mid-1870s, with Scottish backing, had established the Union Steam Ship Company. By 1900 it was the dominant maritime company in Australasia and the Pacific, and was known as the ‘southern octopus’. Coal fuelled the steamers, and the Union Company was a principal investor in the Westport Coal Company, another Dunedin-based business.
A popular event
Dunedin hosted the New Zealand and South Seas Exhibition in 1889–90. It received 600,000 visits, at a time when the total population of the colony was not much more than that. Otago’s centenary historian noted in the 1940s that ‘future generations would regard the Exhibition as marking the climax of Dunedin’s role as the commercial centre of the colony’. 1
Making money out of money
Dunedin firms such as National Mortgage and National Bank Agency, National Insurance and Standard Insurance drew capital from Scottish, London and Victorian sources and then developed their own investing activities. Stock and station agents such as Donald Reid and Wright Stephenson, stockbrokers such as Frater Bros, and families and private individuals all invested locally, but increasingly in the booming North Island too. Other companies moved their head offices north – notably the Union Steam Ship Company in 1921.
Not all financial activity was successful. Politician William Larnach embarked on many abortive commercial ventures, and Robert Wilson, despite his success with National Insurance, also had major failures.