Alfred Beit

British mining magnate

• Born: February 15, 1853
• Birthplace: Hamburg (now in Germany)
• Died: July 16, 1906
• Place of death: Welwyn, England

Beit was one of the most important of the Randlords—the magnates who exploited the mineral wealth in Great Britain’s Cape Colony (now in South Africa). He was also a generous philanthropist, creating the Beit Trust in order to benefit the people of southern Africa.

Source of wealth: Mining

Bequeathal of wealth: Relatives; charity

Early Life

The family of Alfred Beit (bit) descended from Sephardic Jews who had converted to Lutheranism and lived in Hamburg. Alfred’s father, Siegfried Beit, was a prosperous silk merchant. Siegfried and his wife, Laura Hahn Beit, had six children, of which Alfred was the second oldest. An uninspired student, Alfred seemed destined for a career in business. When he was eighteen, he went to work for a diamond merchants’ firm in Amsterdam. In 1875, D. Lippert and Company, a diamond trading firm, sent him to the British colony in southern Africa, where diamonds had been discovered several years earlier.

For most of human history, southern Africa was a sparsely populated, rugged area that was of interest to traders only as a stopping point for ships rounding the Cape of Good Hope on their voyages between Europe and Asia. However, the region acquired a new importance after gold and diamonds were discovered there in the late nineteenth century. Although there were enormous quantities of these commodities, they were buried deep in the ground, unlike the diamonds that had been found in India for millennia, which lie close to the surface, or the gold ore deposited in rivers and rock formations throughout the world. Obtaining these precious commodities would require innovative, enterprising, and efficient mining techniques. Of all the mining magnates in southern Africa, or Randlords, as they came to be called, Beit proved to be the most capable of devising new methods for extracting gold and diamonds.

First Ventures

Beit made his way to Kimberley, the center of diamond mining in Great Britain’s Cape Colony. At this time, Kimberley was a wild town in which a large number of people had come to seek their fortunes. Beit was unprepossessing physically, with little social elegance. Nevertheless, he had two advantages over the other miners. Unlike many of the adventurers, he was studious and analytical. He had also been trained in the best diamond shops of Amsterdam. He realized that the diamonds from the Kimberley mines, which were held in low regard, were in fact high-quality gems, which were worth about ten times more money than diamond merchants had been receiving for them.

Beit borrowed £2,000 from his father and set up his own diamond firm, purchasing as much of the land around Kimberley as he could. As the diamond industry grew, he was able to rent his land at £1,800 a month, and he eventually sold his entire stake for £260,000. His firm set up several trading stations near the mines. He earned a reputation for trading diamonds fairly, quickly, and accurately. In the 1880’s, he became associated with two other leading Randlords who were trading diamonds—Cecil Rhodes and Julius Charles Wernher. He and Wernher established the firm of Wernher, Beit. In addition, Beit helped Rhodes amalgamate the Kimberley mines into Rhodes’s great diamond conglomerate, De Beers Consolidated Mines, Ltd., with Beit investing £250,000 in this new enterprise.

Gold was discovered in southern Africa in 1886, and Beit immediately turned his attention to this new commodity. Because this gold was buried deep in the ground, many people were skeptical about the long-term success of the area’s gold mines. However, Beit saw opportunities where others saw obstacles. He realized that with new and improved engineering techniques, gold could be extracted at an increasingly reduced cost, leading to increasingly greater profits. He acquired several gold mines and brought in the best engineers from the British Empire to devise extraction methods. As a result, his firm pioneered new mining techniques and earned substantial profits. The engineering methods used in his mines were copied by other Randlords.

Mature Wealth

Beit showed excellent judgment in assessing the value of South Africa’s diamonds and gold. However, his political instincts were often less astute. He became interested in the northern frontier that eventually became the colony of Rhodesia, and he was frustrated by the Boers, the perennial enemy of the British colonists in southern Africa. He supported the Jameson Raid (1895-1896), in which the British sought to overthrow the Boer Republics. For his part in the ill-conceived raid, Beit was censured by the House of Commons. Nevertheless, he heavily financed the British military force stationed in southern Africa. In 1902, a strengthened British military overcame fierce Boer resistance in the Second Boer War (1899-1902). Beit also supported the projected development of railway lines in South Africa and Rhodesia.

Beit never married. He moved into the seven-thousand-acre Tewin Water estate in Welwyn, England. His home there was a Regency-style mansion with Victorian additions. In 1895, he had a mansion built for him in Park Lane, London, by the architect Eustace Balfour. Beit filled his London mansion with his impressive collection of paintings by English, Dutch, and Spanish masters and with bronze statues from the Italian Renaissance. He endowed several professorships at Oxford University, and he made donations to the school’s Bodleian Library. He also used his fortune to support artistic and civic causes.

Beit had always suffered from poor health, and in 1903 he had a stroke. He died on July 16, 1906. His estate was probated twelve days later and assessed at close to £8 million, which would be about $6 billion in 2010 U.S. currency. The bulk of his estate went to his brother, Otto Beit, but he also bequeathed about £2 million to charity. Additional benefactions included £130,000 to the London Imperial College of Technology, £200,000 for the general betterment of Rhodesia, £250,000 to construct a university and medical college in Johannesburg, and £20,000 each to King Edward VII Hospital and Guy’s Hospital. He bequeathed his art collection to museums in London, Berlin, and Hamburg. His most important benefaction was £1.2 million to create the Beit Railway Trust in order to develop railway and telegraph operations in southern Africa. This trust would be administered by his brother Otto and other trustees. Beit’s instructions for the Beit Railway Trust allowed for the future use of its funds for public charities and education.

Legacy

Beit was one of the leading Randlords, and the one with perhaps the most impressive history. His diamond-trading firm and engineering techniques enabled diamonds and gold to be efficiently extracted from South African mines. In a period when the miners were heartlessly exploited, Beit’s operations were known for their humane treatment of these workers.

Beit also was one of the world’s leading philanthropists. The Beit Railway Trust constructed most of the bridges that were built in central and southern Africa in the first half of the twentieth century. In 1932, the trust made a large grant in order to initiate civil aviation in South Africa. In 1954, the trust was reconstituted by an act of Parliament into an incorporated charity and renamed the Beit Trust. In the twenty-first century, the Beit Trust provided scholarships and grants in support of health, education, welfare, and environmental projects in Malawi, Zambia, and Zimbabwe.

Bibliography

Beit, Alfred, and J. Lockhart. The Will and the Way. New York: Longmans, Green, 1958. A history of the first fifty years of the Beit Railway Trust, reincorporated as the Beit Trust. One of the authors is Beit’s nephew, Sir Alfred Beit, the son of Otto Beit and a trustee of the Beit Trust.

Fort, George. Alfred Beit: A Study of the Man and His Work. London: Ivor Nicholson and Watson, 1932. An early biographical work. Outdated but remains the only full-length biography of Beit.

Kanfer, Stefan. The Last Empire: De Beers, Diamonds, and the World. New York: Farrar, Straus and Giroux, 1995. Lively account of the fortunes of the Randlords. Praises the unprepossessing Beit as the most advanced of the Randlords in terms of his skill and gentility.

Meredith, Martin. Diamonds, Gold, and War: The British, the Boers, and the Making of South Africa. New York, PublicAffairs, 2008. Account of South African gold, diamonds, and Randlords, and the roles they played in the British war with the Boers.

Pye-Smith, Charlie. For the Benefit of the People. Woking, England: Longmans, Green, 2007. The centenary history of the Beit Trust, with an emphasis on its current projects in Africa.

Wheatcroft, Geoffrey. The Randlords. New York: Athenaeum, 1986. A history of the colorful and profitable exploits of South Africa’s gold and diamond mining magnates.