Feb 25, 2015
By Phin Upham
Stockton, California was full of rich and fertile soil. So rich, in fact, that it presented a problem to farmers attempting to settle there. The tractors they used, large and heavy steam monstrosities that could weigh up to 1,000 pounds, were literally sinking into the earth. This rendered most farming efforts completely useless.
That’s where Benjamin Holt decided to step in and fix the problem. He tried to increase both the size and with of the wheels on those tractors, which made them 46 feet wide. The plan worked, but the downside was that the tractor was expensive and extremely difficult to maintain.
He also tried laying a temporary platform of wood planks ahead of the tractors, but the process was time consuming and not very cost-effective. It also interfered greatly with the tractor’s movements. The ultimate solution, tested successfully in November of 1904, was to put wooden tracks around the wheels bolted together with chains.
Charles Clements, the company photographer, made the observation that the tractor moved across the wet delta of Roberts Island like a caterpillar. Holt took the name and ran with it. The first Holt-produced tractor was sold for $5,500, which would translate to $128,000 today.
Holt filed for a patent in December of 1907, and got the rights to produce a “traction engine.” The improvement promised “endless travelling platform supports upon which the engine is carried.” Caterpillar is one of the most recognized brands in construction, and it was little more than someone’s experiment at efficiency.
About the Author: Phin Uphamis an investor at a family office/ hedgefund, where he focuses on special situation illiquid investing. Before this position, Phin Upham was working at Morgan Stanley in the Media & Technology group. You may contact Phin on his Phin Upham website or Twitter page.