How Robert Bosch started an empire

In 1879, the young Robert Bosch was deeply unsatisfied. He had just completed his training as a precision mechanic. But his thirst for knowledge was far from quenched.

So the 18-year-old Bosch followed his curiosity. He went on a journey of self-education to learn from the best in his field. First, he traveled to the big cities in Germany and worked at different companies. But he soon realized that if he wanted to learn from the masters, he would have to look beyond Germany and leave his home country.

Seven Years of Traveling and Learning

In 1884, he sailed to the United States to work at "Edison Machine Works" (yes, that Edison). After that, he sailed to London to work at "Siemens Brothers" (yes, a branch of that Siemens that is now one of the biggest multinational corporations in the world).

After seven years of traveling, Bosch had not only gained the knowledge and experience he had longed for. He had also developed a vision for a company of his own. Electrical engineering was a booming market back then, and Bosch was determined to be part of this boom.

Starting His Own Company

In 1886, he founded the "Workshop for Precision Mechanics and Electrical Engineering" after he had returned to Stuttgart, Germany. The company did well — at least for a while, until payments from one of his key customers failed to materialize.

This alone would have been bad enough. But on top of this, Bosch had made a risky gamble: he had focused most of his energy on new technologies and new product ideas. All while a critical prerequisite for these ideas was still missing: the town of Stuttgart still had no electric power plant. This made it impossible for this new market to develop.

On the Brink of Bankruptcy

Bosch almost lost everything. He had to let go 22 of his 24 employees. He was on the brink of bankruptcy. He even had to borrow money from his mother. But finally, the power plant was built… and brought Bosch a lot of business.

The moment that changed everything, however, came in 1897. For some time already, Bosch had manufactured so-called “magneto ignition devices.” He hadn’t invented them; they had been around since the 1860s. But his team accomplished something that no one had ever done before. By making a fundamental design modification, their magneto ignition system became the perfect missing piece for a new, up-and-coming product: the automobile. Bosch’s innovation made the automobile much more reliable, a critical requirement to make it into a real mass-market product.

The new magneto ignition became the first patent in the company’s history — and the foundation for what is now a corporation with over 400,000 employees, operating in over 60 countries around the world and generating sales of 91.6 billion euros in 2023.

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When I read about Bosch’s entrepreneurial journey, two things stood out in particular.

First, his incredible thirst for knowledge and learning. But even more importantly, his willingness to go to extreme lengths to satisfy this thirst. In 1884, leaving your home country to travel to a different continent, with a different language, was an effort that only few were willing to make. He understood the immeasurable value of true apprenticeship. To master his craft, he had to learn from the pioneers in his field. No matter where that was and what it would ask of him.

Our modern times delude us. We have endless access to knowledge through books, courses, and social media. But knowledge alone doesn’t lead to mastery. The apprenticeship models of the past also transmitted the other parts of the puzzle: experience and wisdom.

A second aspect stood out to me: Bosch’s relentless pursuit of innovation. That first patent in 1897 was followed by thousands over thousands in the later history of the company. Innovation at that scale couldn’t be done by one man alone. Bosch realized how critical it was to attract the right people: “Whenever you cannot do something yourself [...], the main thing is to know who the right people are for the job.”

Here’s where his mindset gave him a critical edge. While most entrepreneurs at that time considered their employees to be cogs in their machinery, Bosch committed to treating his employees much better than most of his competitors. He became one of the first employers to introduce the eight-hour working day. He created exemplary working conditions. And he also paid them above standard:

He wanted to attract the most innovative, diligent, and loyal employees. And he understood what this meant as a consequence: that his approach to what we today call “Human Resources” would have to be just as innovative, diligent, and loyal.

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