The Ascetic Entrepreneur
The triumph of German and Indian chemical engineering in the early 20th century
Calcutta was experiencing an unusually wet January in 1895. The orthodox Hindu residents of Raja Bazaar were not surprised by the rain though. They had heard of their eccentric neighbor who was a professor of Chemistry at the famous Presidency College. Prafulla Chandra Ray had a reputation for being an iconoclast. After all, he got his D.Sc from the University of Edinburgh when it was sacrilege for a Hindu to cross the seas to foreign lands. He also had an unconventional teaching style. He would bring burnt bone ash to the classroom and encourage his students to taste it, while he enjoyed some of it. The conservative students found it unnerving, as the bones could be of anything: a sacred cow, horse, or even a human skull. For Ray, bone ash was just phosphate of calcium and it was often prescribed as a nerve tonic. This time however Ray crossed a line. He purchased bones from the neighborhood Muslim butchers who sold beef (cows are sacred to conservative Hindus) and let them rot on the terrace of his house. The rain exacerbated matters by causing the bones to attract maggots and giving out a foul stench. Crows began to feast on the carcass and littered the neighborhood with rotting cattle bones.
The neighbors were livid and threatened to complain to the Corporation Health Office. Ray’s troubles did not end there. He carted the bones to a brick kiln and set them ablaze late evening. The policeman on the beat saw the fire and suspected foul play in the wake of a murder and rushed to the location. Ray tried to convince him that he was not trying to cremate a dead body and pulled out some of the bones from the kiln to prove it. Finally having created a large quantity of bone ash, Ray treated it with sulphuric acid to create superphosphate of lime, a very effective fertilizer. He went further by neutralizing the superphosphate of lime with the carbonate of soda to get phosphate of soda, which is a popular food additive and emulsifier.
Ray was thrilled that he was able to manufacture these products which were imported in large quantities in colonial India. The British government impoverished India by treating it as a source of raw materials to power its industry and a monopolized market for its finished goods. There was no incentive to invest in human capital. Educational institutions were set up to primarily cater to middle and upper-class gentry with a focus on churning out clerks, who could be a cog in the wheel of the British Empire’s bureaucracy. Ray lamented that
the college-bred youth has been found to be a hopeless failure; there is no driving power in him; at best he can only shine as a tool or an automaton. … The resourcefulness of the youth should go to the making of a businessman, an entrepreneur, or a captain of industry.
Ray was on a mission to combine scientific temperament, with engineering ingenuity, and entrepreneurial spirit to establish a large-scale chemical manufacturing facility in India. The goal was to rekindle the fire of enterprise amongst Indians so as to challenge the hegemony of the British monopoly. Ray also worried about German scientific and engineering innovation which not only defied British industrial supremacy but also threatened India’s millennia-old economy.
Blue Gold and the Alchemy of Air
By virtue of colonizing India, Britain had a monopoly on producing two sought-after products: indigo dye and saltpeter.
The blue pigment indigo (derived from the Greek word ‘indikon’, meaning a product from India) was a prized dye. Indigo was often referred to as Blue Gold as it was an ideal trading commodity; high value, compact, and long-lasting. While indigo now is synonymous with blue jeans, it was very expensive to procure and had dyed the royal robes of Pharoes and Caesars. By the 19th-century indigo cultivation in India could not keep up with the demands of the clothing industry and the scientific quest for synthetic indigo was unleashed. Adolf von Baeyer, a German chemist, discovered that holy grail in 1865 and won the Nobel prize in Chemistry in 1905 for his work on synthesizing indigo.
Indigo factory in Bengal, India (1850). Source
Preparing the dye in a laboratory is one thing, but scaling production and making a highly profitable product was another challenge. Germany was rich in coal and its chemical engineers were experts in transforming cheap coal into high-margin dye products. It was Heinrich Ritter von Brunck, the innovative and far-sighted engineer in the German chemical giant BASF who scaled the production of synthetic indigo. He assembled what at that time was considered the world’s largest staff of chemists. Brunck was instrumental in driving a strategic decision to invest in research, instead of giving away the surplus cash flows from the company as dividends to shareholders. After 18 million gold Marks and 15 years of research, BASF finally synthesized indigo cheaper than natural indigo in 1897. Within three years of production, BASF became the leading chemical company in the world.
It should be mentioned that Mahatma Gandhi gained recognition on the international stage in 1917 when he led the indigo farmers in Champaran, India on a non-violent struggle (see Champaran Satyagraha). Facing global market pressure, the British government was coercing local farmers to plant indigo at exploitative selling prices. Needless to say, the scientific and engineering innovations made by Germany had a rippling effect on international politics and the world economy. Having mastered indigo, Brunk turned his attention to the other import addiction plaguing Germany: saltpeter.
Towards the end of the 19th century, the world was facing an imminent shortage of saltpeter or potassium nitrate. It was a major fertilizer as it provided the nitrogen content for plants. The situation was so dire that western experts were expecting a Malthusian curse where population growth would surpass food production thereby causing mass famines. The other major application of saltpeter was the manufacture of gunpowder. If any colonial power wanted to preserve its supremacy it had to control the supply of saltpeter. It was a sort of arms race where every nation needed access to saltpeter for their survival. While there existed saltpeter plantations, it took a lot of time to form and needed copious amounts of manure and urine. For instance, the situation was so dire in 1626, that King Charles I issued a decree that every subject preserve their urine and donate them to the saltpeter plantations.
There were only two significant natural deposits of saltpeter in the world: Chile and India. The mud flats of the Ganga river in India were considered the largest deposit in the world to fuel the gunpowder needs of an entire nation. The British East India Company considered it an important resource worthy enough to colonize the country. Germany relied on guano deposits in Chile for its fertilizer and gunpowder. Any interruption in the import could cause havoc to the German economy and military ambitions.
Saltpeter refinery in Bengal, India. Drawn by Nicolaas de Graaff (1671). Source
Brunk, now the head of BASF, saw this as an opportunity. The worldwide synthetic nitrogen market was 2-3 times that of the international dye market. The chemical engineering challenge was to bring down the cost of producing nitrogen so as to compete with Chilean imports.
Fritz Haber, then an ambitious professor at the University of Karlsruhe, threw himself into the task. Haber focused on trying to devise a chemical reaction that could combine atmospheric nitrogen with hydrogen gas from water to create synthetic ammonia. Ammonia would then be the ingredient for fertilizers and gunpowder. For Haber, this was a pursuit of self-actualization and redemption. At the age of 24, he was one of the ten thousand German Jews who converted to Christianity between 1890-1910, so as to assimilate with the community. Haber felt that the undercurrent of anti-Semitism hindered his aspirations to become a respected and renowned chemist. “Haber’s God was not the God of Moses, not the God of Peter, but the God of Science”. He believed that devotion to the temple of rationality by pursuing a career in science would be an escape from systemic discrimination. “As long as Jews contributed to the spirit and accomplishments of science and the nation, Haber thought, they would be valued, tolerated, and even accepted.” Discovering a process to fix atmospheric nitrogen would give him that recognition.
His obsession for fame and fortune came at the cost of his family.
Fritz is so scattered, if I didn’t bring to him his son every once in a while, he wouldn’t even know that he was a father,” his wife wrote.
By 1909 he was able to create the correct mix of temperature, pressure, and catalyst to fuse atmospheric nitrogen and hydrogen from water to produce ammonia in significant quantities in his laboratory. The process required pressures greater than 10,000 meters depth below sea level and temperatures high enough to temper steel. At that time it was considered impossible to build and scale such a system. Brunk smelled opportunity and enlisted his protege Carl Bosch to industrialize this process.
Bosch was a talented chemical engineer, but that is like saying that Lionel Messi is a brilliant soccer player. While most of the chemists in BASF wore suits under their lab coats and enjoyed music, art, and literature during their leisure; Bosch was comfortable spending his time with machines and the factory laborers. He grew up as a precocious child around the tools of his father’s workshop in Cologne. One time an executive found him in a disheveled state working at a tank and exclaimed “.. if you think such foolishness will help you rise to the top at BASF, you are sorely mistaken.” Over time he built a solid reputation as a hands-on chemical engineer and an expert on high-pressure chemistry which won the admiration of BASF’s management team.
Carl Bosch (1874 - 1940). Source Fritz Haber (1868 - 1934) Source
By 1913 Bosch and his team were able to untie the Gordian Knot and produce ammonia at an industrial scale at their factory in Ludwigshafen. One of the key breakthroughs which helped scale the process was identifying aluminum oxide on an iron base as a cheap catalyst. Haber used Osmium, which was a rare element. The catalyst allowed the reaction to be carried out at a lower temperature. They also developed an ingenious mechanism to remove the fresh ammonia created so as to create an equilibrium for the reaction to continue. By lowering the temperature and increasing the pressure, they were able to coax out a greater fraction of ammonia. Commentators likened the Haber-Bosch process to the philosopher’s stone. In theory, nitrogen in the air was limitless and so there was no cap on the amount of ammonia that could be produced. Germany no longer relied on saltpeter imports from across the world for fertilizer and gunpowder. Haber won the Nobel Prize in 1918 for discovering the process. Bosch won it in 1931 for his contributions to high-pressure chemistry. The Haber-Bosch process is still considered to be the most economical process for fixing nitrogen.
Teacher turned Entrepreneur
Ray was keenly aware of the advances made by his contemporaries in Germany. He knew that as a colony, India did not have the technical, financial, and human resources to compete with giants such as BASF. He had to innovate for the bottom of the economic pyramid.
Born to a liberal family during the Bengal Renaissance, P.C. Ray grew up with the values of rational thinking, hard work, compassion for the downtrodden, and an appreciation for literature and learning. Inspired by John Stuart Mill’s childhood he taught himself Latin at the age of 10. Over time he developed a mastery of Greek, French, and Sanskrit so as to enjoy philosophy, science, history, and the classics. He developed an aptitude for Chemistry and won a highly competitive scholarship to pursue his advanced degree at the University of Edinburgh. After returning to India, he focused on teaching and research. Like Haber, he was at the receiving end of discriminatory policies. He had to start as a temporary lecturer at a meager pay despite his exceptional qualifications. He worked tirelessly and gained recognition in the scientific community for having discovered Mercurous Nitrite. Having established himself as a reputed researcher, he turned his attention to establishing a chemical industry in India to ignite the spirit of empowerment, self-reliance, and self-esteem.
In Europe, industry and scientific pursuits have gone hand in hand · · · one helping the other · · ·the gigantic progress in industry achieved in Europe and America is a history of the triumph of researchers in the laboratory. These thoughts were weighing heavy on me .. how to utilize the thousand and one raw products which Nature in her bounty has scattered in [India]? How to bring bread to the mouths of the ill-fed…
Prafulla Chandra Ray (1861 - 1944). Source. Source
He bootstrapped the enterprise with all his savings from his job as a college professor and even took out a business loan against his future paychecks to buy a primitive sulphuric acid plant. Ray christened his new enterprise Bengal Chemical and Pharmaceutical Works (BCPW) in 1901. His first foray into pharmaceuticals began with manufacturing Syrup of Ferri Iodide. It was a versatile drug used in treating scrofuluous affections (tuberculosis of lymph nodes), chlorosis, early-stage scirrhus (tumors), bronchocele (lung congestion), dyspepsia (indigestion), and syphilis. This drug was imported and Ray devised a process to manufacture it locally at scale. There were technical and marketing challenges for his new venture. The first involved ensuring that his indigenous products matched in quality with the imported ones. Take the case of Syrup of Ferri Iodide. His product was susceptible to oxidation and turned brown while the imported tonic kept its light green color. Ray poured over numerous journals in search of a hint until he discovered after many experiments, that a small amount of hypophosphorous acid was a good preservative.
The second challenge was marketing his products. Local druggists were ignorant of chemistry and did not trust any product made locally. They often took a hostile attitude and ridiculed his efforts. Ray enlisted the help of patriotic medical practitioners who vouched for his products. As customers slowly began to buy the product, and drug stores realized the cost savings from sourcing the drug locally, the company began receiving large orders. Over time the company established itself as a significant player in the market. During World War I, the company developed large-scale processes to manufacture nitric acid, sodium thiophosphate (cleaning agent for photographic films), caffeine from “tea dust”, and fire extinguishers for the British war effort.
Ray gained fame as a successful scientist entrepreneur and served as a mentor and angel investor to other enterprises in the region such as textile mills, soap, sugar, ceramic factories, and publishing houses. The British government knighted Ray in 1919 for his services to the crown.
And it repented the Lord that he had made man on the earth, and it grieved him at his heart (Genesis 6:6)
The success of fixing nitrogen catapulted Haber and Bosch to the upper echelons of German society. Haber’s pursuit of glory and German assimilation led him to research lethal gases for trench warfare during World War I. He personally supervised the deployment of chlorine gas in the Second Battle of Ypres, which resulted in around 67,000 casualties. A loveless marriage and the guilt of being associated with war crimes were too much for his wife to bear, who committed suicide in 1915.
After World War I, chemical corporations around the world were merging together to form conglomerates. The idea was to invest in large plants by pooling their resources. Imperial Chemicals in Britain was created by 4 corporations. Five companies in the United States joined together to form Allied Chemical. In 1924, the Germans in the “Council of Gods” meeting created IG Farben from 6 chemical corporations, which included BASF and Bayer. IG Farben was the largest chemical company in the world and the third largest private employer in the world behind US Steel and General Motors. Carl Bosh was named the director of this behemoth.
An enormous aristocratic villa was built for him, complete with elegant rooms, a chauffeur’s house, gardens, workshops, laboratories, a dark room, and an astronomical observatory. It boasted one of the largest private telescopes in Germany. He even hired staff to manage his collection of plants, animals, and minerals. Despite living in such opulence Bosch remained in a sad and pensive mood. An engineer at heart he never really enjoyed running a business. An anecdote talks about him being unable to attend his own party because he was too busy fixing a grandfather clock.
IG Farben was converted into a vassal corporation by the Nazis to further their political ambitions. Bosch did not agree with Nazi policy and often took potshots at them in private. While not overtly confrontational he tried to protect his Jewish employees. As he saw the technologically advanced industry he helped create being used to arm and fuel the Nazi machine, he fell into severe depression and alcoholism.
My entire life’s work will be destroyed and I can not survive that.
He lamented that it would have been better if he had failed in scaling ammonia generation so that the war could have ended early. He died a broken man in 1940.
The Nazis ostracized Haber for his Jewish roots and he left Germany in 1933. As fate would have it, for someone who tried all his life to bury his Jewish heritage, he hoped to find refuge in Palestine, the ancestral home of his people. The pain of being evicted from his own country was overwhelming for him and he died en route in 1934 in Switzerland.
IG Farben was later broken up by the Allies into its constituents. BASF and Bayer continue to function as successful multi-billion euro multinationals even today.
Scientist Saint
For a man who founded a large corporation with multiple factories and employed more than 2000 people, Ray led a very austere life. He would wash his own clothes and polish his own shoes. He was a teacher at heart and dedicated most of his time to educating and inspiring his students. In 1921 at the age of 60, he donated his professorship salary in advance, for improving the Chemistry department and creating research fellowships. All his shares in BCPW were given away during his lifetime as endowments to charitable institutions working on societal reform. Not unlike how Patagonia’s eccentric founder Yvon Chouinard transferred his ownership of the $3B company to a trust to combat climate change.
Ray remained a bachelor during his life. He humorously commented that he at least had better social skills than Henry Cavendish (known for discovering hydrogen). For context; Cavendish had a back staircase installed in his house so as to avoid his housekeeper, as he was extremely shy of women.
He was a vocal critic of British imperialism and a strong supporter of Gandhi. Historians at the Royal Society speculate that it was one of the reasons he was never inducted into the society despite numerous nominations for his prolific research work.
Like Brunk, Ray was a visionary and wanted to invest the profits from the company into researching and developing new product lines. However, the board was more interested in pocketing the profits as dividends. This altercation led Ray to resign from his own company in 1939. He bitterly signed his resignation letter with
Evicted and homeless stranger in the land (i.e., BCPW) he once called his own.
He regretted not being astute enough to appoint scientists and engineers to the board. It could have provided the strategic direction required. Ray passed away in 1944. He died in the same tiny room on the first floor of the college where he lived frugally for 25 years.
Without Ray’s visionary leadership BCPW struggled and has been incurring losses consistently for the last 7 decades. The nationalization of the company in 1980 has done little to revive the enterprising spirit of the organization. Ray and BCPW’s true legacy is in pioneering the pharmaceutical industry in India. Today India is the third biggest drug manufacturer and the world leader in vaccine production.
The ideal of a Philosopher Entrepreneur
The Greek historian Plutarch in “Alexander’s Life” talks about an episode where Alexander the Great meets a gymnosophist. The word has etymological roots in gumnos ‘naked’ + sophistēs ‘teacher of philosophy; in other words an ascetic. The great conqueror asked the ascetic the reason for his penance. The ascetic believed that it was a way to conquer his mind and reach enlightenment. The 30-year-old king sneered at such foolishness. The ascetic posed the same question why had he come all the way from Greece to the river Indus? Alexander was here to conquer the world. He already brought the Persian empire to its knees and wanted to establish Greek civilization. There is only one life to live and it is a waste to sit idly in contemplation without achieving glory and legacy. The ascetic perplexed Alexander by asking what good will these achievements do to him once he is dead. Is the world enough to bring him peace?
I believe there is truth in both worldviews. If we are to solve the challenges facing society today we need a synthesis of these two dissenting imaginations.
Carl Jung, known for founding analytical psychology, is quoted as saying that “Thinking is difficult, that’s why most people judge”. Our purpose here is not to judge these individuals who lived 100 years ago but to learn from them. It is not an attempt to vilify one individual and put another on a pedestal. How can we shape our lives, views, and policies so that mankind can progress?
The Haber-Bosch process is undoubtedly one of mankind’s greatest achievements. Today it produces roughly one-third of humanity’s food while consuming only around one percent of the world’s energy. If any institution wishes to promote innovation and economic prosperity, it must adopt a meritocratic and inclusive policy where talent is recognized without discrimination based on race, color, sex, language, religion, political opinion, origin, property, or another status. Ray exemplified the ideals of courage and renunciation. Where freedom and liberty meant more than profits and honors. Education was an avenue for self-discovery and not just scholarship and employment; entrepreneurship was for self-empowerment and societal development and not rent-seeking.
Plato’s Republic discussed the ideal of a Philosopher King, someone who combines political and military skills with knowledge of philosophy. He believed such an individual would create an ideal state where citizens are the happiest. Similarly one can conceive the idea of a Philosopher Entrepreneur who combines technical and business skills with the knowledge of philosophy. Such entrepreneurs will not only create wealth by innovating to meet market needs but also improve societal well-being.
There are echos of such ideas in Bill Gates’s Creative Capitalism - “an approach where governments, businesses, and nonprofits work together to stretch the reach of market forces so that more people can make a profit, or gain recognition, doing work that eases the world's inequities.” Entrepreneur and thought leader Reid Hoffman also advocates the idea of a Philosopher Entrepreneur (albeit biased towards Western Philosophy), where a grounding in philosophy “will greatly benefit … an entrepreneur, opening [their] mind to new ways of thinking deeply about people, problems, solutions and even [their] manner of thinking itself.”
The challenge of our times can be expressed as a conflict of values. The French Revolution championed the ideals of Liberty, Equality, and Fraternity. The Industrial Revolution advocated Productivity, Growth, Efficiency, and Rationality. The conflict between the two has created the challenges of Plurality, Justice, and Sustainability. I believe Philosopher Entrepreneurs are the heroes who can harmonize these ideals. Sustainable innovations that promote economic prosperity while championing human rights, dignity, and unity. As the Amish saying goes “We have not inherited the World but have merely borrowed it from our Children”.
References:
Life and Experiences of a Bengali Chemist, Prafulla Chandra Ray, 1932
Alchemy of Air, Thomas Hager, 2009
Everything seem to end in misery