The Hostage Who Invented Hershey After Getting Kidnapped
This video is sponsored by Manscaped. Hershey owns one of the largest chocolate factories in the world, and is reportedly worth 21 billion. Its humble beginnings were led by a 12-year-old dropout who was expected to replace his absent father, but turned into the black sheep of the family.
Failure, bankruptcy and death stood in the way of his chance at success for years until discovering the secrets to making candy. And it all started with a cow. Before we get into the next part of the story, our team would like to quickly thank our sponsor. Manscaped the global brand for men's grooming and hygiene. products. Manscaped is now offering an all-in-one luxury grooming kit called the performance package 4.0.
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deodorant, crop reviver ball toner spray, weed Whacker nose and ear hair trimmer, and the magic Mat disposable shaving mats. For a limited time, you can get all this plus two free gifts. The premium shed travel and storage bag and the Manscaped anti-chafing boxer briefs. Go to Manscaped.com today and get 20% off plus free international shipping. When you use promo code HOOK20 at checkout, or click the link in our description below. In the mid-19th century, Milton Hershey was born and raised in Dauphin county, Pennsylvania to poor farmers, Henry Hershey and Fanny Snavely.
While both parents came from prominent families of ministers, farmers, and entrepreneurs they lost and struggled to regain their wealth from Henry's get-rich-quick schemes. All 17 of them ended in failure, but Henry remained optimistic and continued his pursuits. Meanwhile Fanny, once a supportive wife grew bitter toward her starry-eyed husband. Right before Milton’s third birthday, Henry sold his farm and moved the family close to oil city, Pennsylvania, hoping to cash in on America's first oil boom. they could only afford to live in a tiny shack in nearby Titusville, where the streets were filled with mud and the air reeked of rotting food and outhouses. After two years, without any luck, Henry started to run out of money.
Fanny was more worried than ever since she was expecting their second child. When her family found out her brothers, Abraham and Benjamin traveled from Lancaster county to visit, they were shocked to discover how lifeless their sister had become and how small and weak their nephew Milton was. “Fanny used to be better," Benjamin insisted before turning toward Milton. "How old is he? Four and a half? He's as puny as a three-year-old. Get him to the farm where he can have fresh milk and eggs every day." "You don't understand!" Henry cried.
"With the civil war, the army needs oil. Men are becoming millionaires and helping a good cause at the same time. I just need a little more money." "We have money to help." Benjamin replied. "And we'll use it to move all of you back home.”
Convinced that fortune was just around the corner, Henry pleaded with Fanny to persuade her brothers to lend him more money. "I'm sorry, but I can't live like this anymore." Fanny admitted.
"I can't bring up my children here. You have to give up this dream." Without Fanny’s support, Henry had no choice, but to oblige and return to Dauphin county. When the Hershey’s settled back home Fanny gave birth to her second child, Sarena, and Milton started school.
Milton didn't enjoy his classes and did so poorly that he could barely read. Meanwhile, Henry started a new business selling farm equipment. Like his other ventures it ended in failure. The Snavelys could not bear to sit back and watch Fanny struggle with two young children. So they reluctantly gave Henry one of their farms in Lancaster county in hopes that he could finally be a provider.
Henry agreed to their generous offer and moved the family to Lancaster. Henry was enthusiastic about the farm and started raising trout chicken, and cows and planting berries, shrubs, and roses. But eventually he became distracted by another get-rich-quick scheme and neglected the farm, leaving Fanny to raise the children, maintain the farm, and sell eggs and handmade brooms to earn money alone. In spite of her efforts, there were times where the family didn't have enough food to eat, and Milton went to school without proper shoes. When winter came, necessities like food and clothing weren't Fanny's only concerns.
Their drafty cabin on the farm never stayed warm, and both Milton and Sarena caught colds. As Milton started to recover Sarena’s condition worsened. A faint red rash developed on her neck and spread down her chest and body. Fanny then realized Sarena didn't have a cold.
She had Scarlet fever, a fatal illness that killed more children than anything else at the time. Sarena was no exception. After a few weeks, she passed away at just four-years-old.
"What did I do to deserve such punishment?” Fanny wailed to her sister, Mattie. "My life is over. There is nothing for me now." "Nonsense," Mattie insisted. "You have your son.
We must make sure he turns into a proper man. We cannot trust his father to do the job." Fanny heeded her sister's advice. She had already been teaching Milton the importance of hard work and encouraged him to become a farmer or entrepreneur.
Meanwhile, Henry insisted Milton pursue his own unfulfilled dream of becoming a writer. Milton was unsure about what he wanted for himself. All that he knew for certain was that school was not for him. It didn't help that one of his teachers told him he should leave and that he would never learn anything.
So after learning how to read, write, and do simple math, he decided it was time to leave. While he was just 12-years-old, Fanny supported his decision. She believed school wasn't necessary to become someone respectable. Henry was devastated. He arranged for Milton to work as an apprentice at a print shop in hopes that he could still become a writer by working his way up.
Milton wished that his father would give up on this dream for him, but accepted the job anyway. Milton hated working at the print shop. The owner, Samuel Ernst, had a bad temper and yelled at Milton almost every day. After a few months, Milton could not bear the treatment any longer and threw his hat into the press so that the machine would break and he would get fired. Such a scheme was his only option since his father signed a contract, binding him to work at the shop for five years.
Fortunately for Milton, his plan worked and he was sent home right after. When Milton returned home Fanny was puzzled as to why he was back so early. Milton gently told her the news. To his surprise, Fanny wasn't disappointed and assured him that he would find a better job soon. Shortly after aunt Mattie came by to visit and shared that a confectionary in Lancaster named Royer’s was looking for an apprentice.
Milton beamed with excitement and immediately headed over to apply. Upon meeting, Joseph Royer liked Milton's enthusiasm, but was concerned that he wouldn't be able to handle the physical labour. "I'm not afraid of hard work,” Milton insisted. "I know I can do it if you give me the chance.
I'll do any job you say." Impressed by his eagerness Joseph immediately hired Milton. He taught him how to buy ingredients, make ice cream and candy and set prices. Early in Milton's training, Fanny encouraged Milton to focus on making candy.
She noticed that among all the confectionery products offered, candy had the longest shelf life and brought in the most profit. In hopes that Milton would one day open his own shop, she paid Joseph to excuse Milton from any duties that didn't involve candy. Meanwhile, Henry disapproved and claimed making candy was a woman's job. Milton paid no attention to his words. He found the work exciting and enjoyed learning all that there was to know. But after four years there was nothing new for Joseph to teach him.
"It's time you moved on to your own business." Fanny insisted. "You can't be an apprentice forever.” Milton was taken aback. He had saved a bit of money over the years, but it wasn't enough to open a confectionary.
"You have proven yourself capable of hard work." Aunt Mattie chimed in. “The Snavely’s will provide the money to help you get started."
Milton was relieved and overjoyed. Having his own business meant that he could experiment with new recipes and hopefully make some of the best candies that would give people joy. Several months later, Milton opened a confectionary in Philadelphia. Fanny and Aunt Mattie deemed it the perfect city since America's first world fair, the Centennial Exposition, was being held there.
Milton's shop was along the pathway to exposition, making it an ideal place to attract large crowds. Milton's shop offered a variety of goods besides candy including ice cream, fruit, and nuts to appeal to everyone. His strategy worked and business did so well that he had to move to a bigger space, open a wholesale shop and enlist help from Fanny and aunt Mattie. But eventually the price of sugar became too expensive, and Milton struggled to make a profit.
Fanny suggested that Milton raise his prices, but Aunt Mattie warned that he would lose customers. The U.S. economy was recovering from the long depression and few people had money to spare. Aunt Mattie’s solution was to hire a respected businessman from Lancaster as an accountant: William Lebkicher. William reviewed the account books and advised Milton to pay off his suppliers to receive more credit. The amount was twice what an average worker made in a year.
Milton couldn't afford to pay them back, so aunt Mattie instructed him to write to her brothers, Abraham and Benjamin, and ask for a loan. Abraham and Benjamin sent the money, but it was only enough to keep the business going for a couple of months. William advised Milton to cut down costs wherever possible and limit his products to candy. Milton was disappointed, but understood that staying in business required tough decisions. Not long after the demand for Milton's candies grew and a bigger space was needed. Milton couldn't afford the cost.
So aunt Mattie instructed him to write to Abraham and Benjamin again and say that Mattie needed the money to make a new investment in the shop. Fortunately, they agreed to send the money. It was around then that Milton received an unexpected visitor and an interesting offer. His father, Henry, moved to Philadelphia to not only reunite with Milton but become his business partner.
In spite of all his past schemes, Milton didn't have the heart to turn him away and invested in his new ideas, even though his business was still in debt. After three of his ideas failed, Milton suffered from a mental breakdown and became seriously ill. His doctor advised Fanny, aunt Mattie, and Harry to run the shop for him until he recovered. Otherwise, he wouldn't survive.
A few weeks later, Milton was still bedridden. Still Henry burdened him with a new proposal: buying his share of a cabinet business so that he could move to Denver and cash in on the Colorado silver rush. The cabinet business wasn't related to Milton's shop.
It was merely one of Henry's ideas that Milton was fooled into investing in using the shop’s money. And while Milton knew the shop couldn't afford to lose more money, he agreed to Henry's proposal out of fear that Henry would drive the shop into bankruptcy if he stayed. It took Milton an entire month to recover. By then the shop was in so much debt that Milton had to ask his uncles for another loan.
They sent some money, but not enough to keep the business going. When Milton begged his uncles for more money, his letters went unanswered. Aunt Mattie decided to travel to Lancaster to find out why.
She discovered her brothers could no longer afford to keep helping Milton since their funds were tied up in other businesses. After six years, Milton had no choice, but to file for bankruptcy. Like his father, he had become a black sheep in the eyes of the Snavelys. This is a hook special, don't forget to subscribe to our channel.
After filing for bankruptcy and losing his shop and warehouse, Milton returned to Lancaster. He felt uncomfortable being back home. His uncles never brought up their lost money, but he could feel their disapproval each time they looked at him. Eventually, Milton not only wished to get away from the watchful eyes of his uncles, but experience a change of scenery.
Fortunately he received a letter from Henry about how wonderful Denver was and to meet him there. Milton decided to put the past behind him and accept Henry’s invitation. Fanny and aunt Mattie didn't like the idea, but understood why Milton needed to leave.
By the time Milton arrived, Denver fell into a financial depression. Milton decided to try and find a stable job. During his search, he discovered a shack with a "help wanted" sign. Milton walked in.
Before he could finish his sentence, an old man curtly told him to head toward the back room with the other boys. Milton didn't get a good feeling. "What kind of job are you offering?" Milton quickly asked.
"Just go back there and you'll find out," the old man insisted. "You want a job, don't you?" Milton was hardly desperate. Before heading to Denver, Aunt Mattie loaned him a $100 bill. He didn't trust the old man and decided to leave. But when he walked back to the front door and turned the handle, it was locked. "Let me out!" Milton demanded.
As his heart started racing, the old man grinned at Milton. "I need workers," he explained. "I'm going to send you to the countryside to take care of livestock. It's hard work, but it will make a man out of you.” Milton had heard about labour contractors abducting young men, and making them work for unlivable wages.
Remembering that his father had given him a gun before leaving, he quickly pulled it out of his pocket and demanded that the old man let him out. The old man quickly reached up and pulled a string that unlocked the door. Without turning his back, Milton reached for the handle and backed out of the building.
Milton hurried toward Denver’s city center. On his way, he passed by investment offices, auction houses, and gambling clubs. He was beginning to doubt he would be able to find a stable job at a decent business.
Just when he was about to give up, he saw a confectionary with a "help wanted" sign. Milton went in to apply and was hired as a candy maker. Early in the job Milton discovered the ultimate secret to making candy.
And it surprisingly came from a cow. When the confectionery made caramels, they used fresh milk instead of paraffin wax, and blended it with vanilla and sugar. The fresh milk made the caramels softer, smoother, and sweeter, and allowed them to be kept on the shelf for many weeks without spoiling. After a few months, Milton memorized the recipe and decided to try his luck in selling his own.
The recipe was unheard of elsewhere and wasn't under any copyright or patent. Milton didn't have enough money to get started, so he returned to Lancaster in hopes of convincing aunt Mattie to loan him more money. Aunt Mattie was impressed with his Denver-style caramels and agreed to help him once more. With her support, Milton felt confident enough to open a new confectionery in the most competitive city in the country, New York. When Milton arrived in New York, he decided to work for a confectionary called Huyler’s Candies.
His plan was to learn about the local suppliers and New Yorker’s taste before starting a new business. After just one year, he learned all that he needed and opened his own shop. New Yorkers were hooked on Milton's new caramels. Milton became so busy that Fanny and aunt Mattie moved to work for him. Week after week sales grew, and Milton became more confident that he was on the path to success.
But just like with his first shop, Henry showed up unannounced and convinced Milton to invest in his cough drop business that quickly failed. Afterward, Henry fled the city and left Milton with a mounting debt that he couldn't repay. Milton had no choice but to once again file for bankruptcy and leave the city. Failing for the second time felt no less painful than the. first. Still, Milton held onto a bit of hope that the Snavelys would take him in and even help him open a new shop in Lancaster.
He was confident that he would do better there since he could lower costs by using local milk, instead of the imported kind as he did in New York. The Snavelys patiently listened before turning him down, letting him know that he was too much like his father and no longer welcome in their home. With nowhere to go, Milton turned to his former accountant, William, who gave Milton some money to get back on his feet. Milton wasted no time in proving his family wrong and repaying William's kindness. He immediately rented a small room in a warehouse and started making his Denver-style caramels again. Afterward, he established the Lancaster Caramel company and sold his caramels first from a handbasket and later a pushcart, as they became more popular.
A few months later, Milton made enough money to move operations to a small space in a factory. Fanny and Aunt Mattie surprised him one day by showing up to help and to let him know they had never lost faith in him. They had only stayed away to give him time to figure things out on his own. Milton was grateful, and even more so when aunt Mattie allowed Milton to take out a loan under her name to scale production. There was just one problem.
Milton only had 90 days to pay it back. Week after week, Milton visited countless shops in Lancaster to sell his caramels. Many of them placed orders, but it wasn't enough to pay off his loan. Still, Milton didn't let the thought of failing overwhelm him, and fortunately his optimism paid off a few days before the money was due.
A British importer was passing through Lancaster and happened to try Milton's caramels. Afterward, he tracked Milton down to place a large order to be shipped to England. If they arrived in good condition, the importer would mail Milton a cheque.
Milton decided to take the risk. He didn't receive an advance that could pay off his loan or help complete the order, so he begged the Lancaster National Bank for more money. A junior bank officer named Frank Brenneman told Milton what he already knew: It was too much of a risk to give him more money. Milton pleaded with Frank to see his operations and try his caramels before giving a final answer.
Frank reluctantly agreed. The next day, Frank offered Milton a loan under his name since he knew the bank would deny Milton's request. "You were honest with me," Frank explained. "You didn't hide how tough things are for you or make excuses for it. I believe you are a risk worth taking." A few weeks after shipping the caramels to England, Milton received a letter in the mail.
Inside was a bank draft for 500 English pounds. Tears rolled down from Milton's face. Finally, he was able to pay off all his debts and his worries were over.
From then on, the Lancaster Caramel company expanded its market year after year. Milton even became known as one of Pennsylvania's most prominent men, but eventually Milton became restless as his new employees took over production. So he decided to attend the Columbian exposition in Chicago to see some of the world's newest inventions.
At the exposition, Milton discovered a chocolate factory from Germany. As he observed its operations the owner, J.M. Lehmann, offered Milton a bar while pointing out that his mass production method had made chocolate less expensive.
At the time, chocolate was considered a luxury that only the wealthy could afford. "This is better than anything I've had," Milton exclaimed as he took a bite. The milk chocolate was smooth and rich, a stark contrast from the grainy and bitter kind that he was used to. Lehmann nodded. "Americans do not know how to make smooth and rich milk chocolate.”
"You can really make this at a price that everyone can afford?" Milton asked. JM assured him that his operation made it possible, and that chocolate was the future. Milton didn't doubt his prediction. He had already noticed there were less orders for his caramels from Europe and later discovered chocolate was the cause. Sensing that it would one day become an American staple, Milton asked Lehmann if he could buy his equipment. Lehmann gladly accepted his offer.
When Milton returned to Lancaster, he established the Hershey Chocolate Company and sold his caramel business for 1 million. Afterward, he focused on coming up with a formula for smooth and rich milk chocolate, just as the Europeans did. During this process, he decided to not only build a massive factory, but an ideal town for his workers in Derry church. Taken aback by his plans, milton's wife and associates suggested that he seek a doctor and get his head examined. One even suggested that he appoint a guardian to control his finances. Still Milton forged ahead with buying land and beginning construction.
Unbeknownst to everyone, Milton would end up building the largest chocolate factory in the world, molding his company into a billion-dollar empire. Time was not on Milton’s side. Five months after construction began, the new factory walls were nearly completed. Meanwhile, Milton had yet to come up with the formula for smooth and rich milk chocolate.
In spite of his best efforts, it appeared the factory would surely be completed before Milton was even close. Desperate, Milton hired a chemist to help him, but quickly fired him after burning a batch of milk and sugar. Then Milton sent for someone he knew he could trust: an engineer who worked for his caramel factory named John Schmalbac. The problems that Milton and John faced were common. Generally milk chocolate was difficult to make since milk and chocolate do not mix well. Milk is mostly made of water and chocolate contains a lot of oil in the form of cacao butter.
Before mixing these ingredients, any water in the milk needs to be removed through evaporation, which is a very tricky process. Many factors need to be considered to ensure the mixture accepts cacao and other ingredients without getting lumpy, and last more than a few days before spoiling. These factors include the breed of cows, the heating rate, and how the mixture is cooled and timed.
During John's first experiment, he poured low-fat milk from Holstein cows and heaps of sugar in a giant kettle to make condensed milk, gradually raising the heat. After several hours, he allowed the mixture to cool off for a bit, which resulted in it being smooth and easy to add cacao and other ingredients. The taste was described as sweet, with a distinct flavor, a subtle sour note caused by the fermentation of milk fat. Milton later discovered that John's method allowed milk chocolate to last for several months without spoiling and mass-produced faster and cheaper than the Europeans.
This was because John's mixture consisted of condensed milk instead of powdered milk, making it easier to move through various processes like pumping and pouring. It also required less time to be placed in moulds. Finally Milton had a formula that allowed him to offer milk chocolate at a price that everyone could afford and prove that a career in candy wasn't limited after all. But not long after the discovery, one of the few important people who once doubted him was suddenly gone. His once skeptical father Henry passed away from an unexpected heart attack. After such a tragedy, Milton had to forge ahead with opening his new factory and launching his new milk chocolate bars.
Sales during its first year topped 1 million, which was nearly equal to one of America's newest and biggest brands, Jell-o. Afterward, Milton launched two more signature products that brought in even more millions: milk chocolate bars with almonds and bite-sized chocolates wrapped in foil called Hershey Kisses. Because of its name, Hershey Kisses became a popular and iconic Valentine's day gift. It was around then that Milton decided on his company's product strategy: producing only a few products in huge quantities and pricing them no higher than a nickel.
That way nearly every shop in America could afford to stock Hershey products. And many of them did. The strategy took the company to new Heights of success that surpassed Milton's expectations. After just a couple of years, the factory tripled in size and later became the largest of its kind in the world.
As the Hershey Chocolate Company flourished, Milton's wife Catherine’s health worsened. She had been diagnosed with nerve damage years ago and could no longer accompany Milton on his travels. Still, Catherine appeared as lively as the day they had met. Milton was often oblivious to her pain since she hid it so well.
One day, Catherine caught pneumonia and managed to convince Milton to give her champagne. As he walked to get her a glass, a nurse pointed out that Catherine suddenly looked different. By the time Milton hurried over, Catherine had already passed away. With no children of their own, Milton threw himself into work after Catherine’s passing, but eventually he decided to take a much needed vacation to Cuba. He immediately fell in love with the country and its people and was in awe of the oceanic sugar cane fields on the bluffs overlooking the north coast.
Before leaving Milton had made up his mind about Cuba. He was going to not only build a sugar mill, but an ideal town for his workers, as he did in Derry Church. But unlike those who came to Cuba to turn a profit, Milton genuinely cared about creating opportunities for others. When Milton returned home Hershey executives were taken aback by his plans.
The company's VP, William Murrie, was especially fearful of the financial burden. But just like before, Milton forged ahead with buying land and beginning construction. Along with creating the world's most advanced sugar mill, Milton built modern utilities, schools, health clinics, and subsidized housing for his workers. He also added a ballpark that became one of Cuba's most beautiful, drawing teams from all over the country. It was only later that Hershey executives realized to what extent Milton's plans were worth the risk. The factory in Derry church was surrounded by dairy farms that could easily supply fresh milk, and the mill in Cuba ensured an abundant supply of affordable sugar.
In fact, one year after Milton announced his plans in Cuba, America joined the first world war and sugar became more scarce and expensive. The Hershey chocolate company managed to survive from its own supplies and meet a us army contract for huge quantities of cacao and 2 million chocolate bars. During the last year of the war, the company topped 20 million. After the war ended, Milton decided to take advantage of the peace and travel to Europe for the first time since Catherine's passing. His plan was to visit all the places where they enjoyed some of the best moments of their lives together. But unfortunately he had to quickly return home.
His endlessly supportive mother, Fannie, caught pneumonia and passed away. From then on Milton could only reflect on his mother's belief in him for comfort during difficult times, especially as he faced fierce competition from hundreds of candy makers who set out to overthrow him. Year after year competitor products grew into new American favorites, including the Clark Bar, Baby Ruth, Mounds, Oh! Henry, and the Milky Way.
Meanwhile, Milton didn't let the fear of being overthrown get to him and continued to focus on only a few products. It wasn't until the stock market crashed and sales dropped by half that Milton decided to change his product strategy: offering a supply of his own chocolate. At the time, one of Milton's former employees, Harry Reese, invented an unusual product, a milk chocolate cup filled with peanut butter. Many Americans had never tasted peanut butter since it was made to be a health food for people who couldn't digest meat. Still, Harry's product Reese's Peanut Butter Cups was not only popular among retailers, but Hershey employees.
So when Milton found out, he didn't treat Harry as a threat. Instead, he offered to supply his chocolate. Fortunately Harry accepted his offer and the two profited greatly.
Soon after Milton ended up supplying chocolate for his other competitors, including Oh! Henry, and the Milky Way. Milton had proved once again that his plans were worth the risk, but it became impossible for him to avoid what quickly came next: the Great Depression. Sales dropped lower than before. Other businesses were going bankrupt and many Americans were taking their own lives. Milton not only had to think about his bottom line, but the livelihood of his workers.
So to keep them employed, he made plans to build a new high school, a sports arena, a community building, and a hotel in his town. Once a foreman told Milton his steam shovel could do the job of 40 workers. Milton immediately ordered him to get rid of the shovel and hire 40 workers. While Milton managed to keep all his workers employed, he did have to shorten working hours and pause bonuses during the depression.
As a result, some workers became bitter and began a sit-down strike, which involved occupying factories until demands were met. Fortunately, other workers took matters into their own hands and ended the strike. Milton was deeply hurt. He had struggled to keep his workers employed and in return, they ended up betraying him. Still, Milton didn't fire or demote any of the workers who took part in the strike. He was even overjoyed to see them show up to his birthday party.
Later that year, seven years later, Milton passed away from pneumonia at 88-years-old. While he invested his entire fortune towards his school and home for orphaned boys, the Hershey Chocolate Company continued to reach new heights of success. It became the maker behind 90% of the milk chocolate produced in America and ended up offering a wide variety of popular products through new inventions, acquisitions and licenses, including Kit Kat bars, Reese's Pieces, York Peppermint Patties, Jolly Ranchers, Mounds, and Almond Joy. Today, the Hershey Chocolate Company is reportedly worth 21 billion.
This is the story of how a 12-year-old dropout uncovered the secrets to making candy and overcame failure and bankruptcy before building one of America's greatest fortunes. For more inspiring stories and advice from today's most successful leaders, don't forget to subscribe to our channel.