Rathenau’s Lifetime of Achievements

The most defining achievement of Rathenau’s lifetime was his most notable, the founding of Allgemeine Elektricitäts-Gesellschaft (AEG), however, that is not his sole achievement. Rathenau’s work founding AEG included many small achievements in itself and some of his achievements linked to other companies he worked with. In 1865, Rathenau founded a small machine factory. This small factory became one of Rathenau’s first successes as it produced a portable steam engine and quickly became profitable. However, by 1872, the banks and Rathenau’s co-owner wanted to change the company into a joint stock company. Rathenau strongly protested and filibustered this, which resulted in liquidation of the company in 1873.

Just under a decade later, in 1882, Rathenau obtained the rights to use Edison’s patents dealing with electricity. This move would be the beginning of Rathenau’s most known achievement, the founding of AEG. Rathenau founded “German Edison Corporation for Applied Electricity” (Deutsche Edison-Gesellschaft für angewandte Elektricität) less than a year after he acquired the rights. This company would later develop into AEG. Rathenau partnered with his competitor, Werner von Siemens, when founding this company in order to create a monopoly on electricity. Siemens would produce and sell generators while Rathenau would build the power stations and lay cables. Rathenau expanded his company’s reach when he signed a deal with the magistrate of Berlin in 1884 to allow Rathenau’s company the use of public streets for electricity lines. This deal between Rathenau and Berlin has been hailed as Germany’s first private-public partnership, an impressive achievement on its own. In 1887, Rathenau detaches his company from the American Edison Company and changes the company’s name to Allgemeine Elektricitäts-Gesellschaft (AEG). AEG, in 1891, transmitted power over 175 kilometers to Frankfurt from a power plant in Lauffen am Neckar. This marked another success, the start of alternating current being used for electrification in Germany. This also demonstrated that it could be economical to transfer electricity over large distances, a practice which AEG soon took up. As AEG continued to grow, Siemenes and Rathenau’s partnership began to deteriorate and the partnership ended in 1894. Rathenau then perused a different business style, focused more on flexible adaption to market. His new business style and Rathenau’s leadership allowed the company to grow even more. Rathenau’s son, Walther Rathenau, joined Rathenau in running the company in 1912 when Rathenau began to become sick. Walther ran the company after Rathenau’s death in 1915.

Rathenau’s lesser known achievements, such as the smaller, specific achievements his company achieved with his help, also contribute to Rathenau’s fame, especially in certain circles. However, Rathenau’s achievements are not solely what he accomplished during his lifetime but also the legacy he left behind. His company, which still exists today, has grown and expanded, a proper representation for the legacy of this successful and ambitious man.

Rathenau’s Role and Influence in German Society

Since the 1890s, Berlin developed into an industrial city, manufacturing wool, worked iron and steel, heavy machinerz, sewing machines, bicycles and so on. More than 50 percent of old Berlin’s working population were employed by industry. Most importantly, Berlin became the center of electrical industry, producing light electrical equipment for Germany and the rest of the world. AEG along with Seimens & Halske became two leading manufacturers of electrical machinery in the world, together employing about 50 percent of the personnel of Germany’s electrical industry until World War II.

During this process, Rathenau played an essential role in developing AEG into a multinational corperation and propeling the industrialization of Berlin. He significantly influenced the society by developing AEG into the largest manufacturer of electrical machinerz and apparatus by 1900, surpassing Siemens. AEG had 17,300 employees and 60 million marks in share capital, compared to Seimens’ 13,600 and 54.5 million. In 1911, AEG supplied 31 percent of the total connected electric load in Germany and extensively influenced German utilities through stock ownership.

Rathenau became famous for his business achievements of successfully leading AEG. Nothworthyly, he expanded AEG outside of Germany and initiated a wave of globalization. For example, Rathenau established Aluminum-Industrie A.G. in Neuhausen, Switzerland. In 1903, Rathenau reached an agreement with General Electric in America to continue preeminent in Europe, while GE in North America. The two companies also cooperated to jointly develop the Riedler-Stumpf and Curtis steam-turbine.

Because of Rathenau’s role in industrialization and his strategy of financing customers to expand the market, Rathenau was known as “the inventor of the principle of market creation through investment financing.” Although Rathenau’s fame was tied closely with the electrical industry, Rathenau was quite different from Seimens, who represented invention, engineering and industrial science. Rathenau was the spirit of industrial enterprise, who mastered the powerful and whidely influential interaction of investment capital.

Rathenau also deeply influenced the business world as well as German society through his highly organiyed marketing. In reconciling his Jewish identity with German culture, Rathenau required Berhrens to depersonlize AEG’s corporate image. He managed AEG to represent not him as a Jewish owner, but a “collective self-portraits” of all stakeholders, including consumers, workers and stockholders. Thus, Rathenau was praised by many art critics for synchronizing the industry and art, and constributing to the German culture as a whole.

In addition, Rathenau brought the concept of efficiency into German culture under the indutrialization backdrop. He was among the very first people to introduce assemly line production to Germany. Rathenau worked 15 hours a day himself and contributed to the fast industrializing of Berlin.

In conclusion, Rathenau was not only an influencial business leader in electrical industry but also a great contributor to German culture and identity. He was not constrained by his Jewish ethinicty, but he saw himself belonged to Germany and the world. His practical style, embracing of German culture, promoting of capital investment and financing and global awareness will continue to live in German culture, influcing generations after generations.



Rathenau’s Footprints in Berlin

Although Emil Rathenau passed away before the start of WWI, he is still commemorated by Germans. We find three streets that are named after him, Emil-Rathenau-Straße. Tow of them are in two southern German cities, Crailsheim and Backnang and one in a northern Austrian city, Linz. Rathenau worked for a short period of time in August Borsig locomotive factory in Berlin. The Berlin Technology Museum exhibits several locomotives that are produced in that factory. The Technology Museum also displays televisions produced by Telefunken, which Rathenau established by partnering with his competitor, Werner von Siemens, noted German engineer in 1903. AEG’s adds are also displayed in the Jewish History Museum. The Deutsches Historisches Museum has collected an oil on canvas portrait (115 x 90 cm) of Rathenau painted by Otto Rasch in 1895. His two original photographs are also among the The Deutsches Historisches Museum’s collections.