Stanford was one of the ‘Big Four’ investors — a group that included Collis P. Huntington, Mark Hopkins, and Charles Crocker — who controlled the Central Pacific. The detail that matters here is that these men were not just railroad builders; they were the architects of a monopoly that shaped California’s economy for decades.
Stanford himself served as Governor of California from 1862 to 1863, a brief tenure that overlapped with the early stages of the railroad’s construction, and later as U.S. Senator from California from 1885 until his death in 1893. The wealth generated by the railroad was substantial.
At his death, Stanford’s estate was estimated at $50 million. That figure, under the hood, represented the profits from land grants, government bonds, and the sheer volume of freight and passengers moving across the continent. But the money did not simply accumulate in a vault.
In 1885, Stanford founded Stanford University in memory of his son, Leland Stanford Jr., with an initial endowment of $20 million. That endowment, drawn from the railroad fortune, established one of the world’s leading research universities.
Born in 1824, Stanford was a businessman before he was a politician, and a politician before he was a university founder. He was a politician who understood that the levers of state power could be used to advance private enterprise — a lesson that, as ever, remains relevant. His tenure as governor was brief, but his time in the Senate gave him a national platform.
He died in office in 1893, still a senator, still a railroad magnate, still a figure of immense influence.
The spike and the university
The golden spike ceremony at Promontory Summit on May 10, 1869, was a moment of national theatre. Stanford drove the spike that connected the Central Pacific and Union Pacific railroads, completing the first transcontinental railroad. The spike itself was a ceremonial object — the actual joining of the rails was done with ordinary iron — but the symbolism was unmistakable.
The continent was now linked by rail, and Stanford’s Central Pacific had built the western half of that link. The university that bears his name, founded in 1885, was a direct response to the death of his son.
Leland Stanford Jr. died at age 15, and the Stanfords decided to create a university as a living memorial. The initial endowment of $20 million was, at the time, one of the largest gifts ever made to an educational institution. The university opened its doors in 1891, two years before Stanford’s death, and has since become a cornerstone of Silicon Valley’s innovation economy.
The Big Four and their legacy
Stanford’s partnership with Huntington, Hopkins, and Crocker was a study in complementary skills. Huntington handled the political lobbying in Washington; Crocker managed the construction crews; Hopkins kept the books. Stanford, as president, was the public face of the enterprise.
Together, they controlled the Central Pacific and, through it, much of California’s transportation infrastructure. The ‘Big Four’ were not universally admired — their business practices were often criticised as monopolistic — but they got the railroad built.
What to watch next is how Stanford’s legacy continues to evolve. The university he founded is now a global institution, but the source of its founding wealth — the railroad, built with Chinese labour and government subsidies — remains a subject of historical scrutiny. The balance between the achievement of building the transcontinental railroad and the methods used to do it is a conversation that shows no signs of ending.
For now, the facts are clear: Stanford drove the spike, founded the university, and left behind a fortune and a name that still matters.
