Could The VOC Consider as The Most Valuable Companies of All-Time?

infographics from visualcapitalist[dot]com, stated VOC as
The Most Valuables Company of All-Time

In the end of the year of 2017, I saw an interesting infographics in my social media feed that reminds peoples about an old company that for long time ago take a part in the colonialization process in Indonesia, the Veerenigde Oostindische Company (VOC). This infographics released by visualcapitalist[dot]com as a part of their weekly feature of “Chart of the Week”, and in Friday December 8th 2017, they put VOC as The Most Valuable Companies of All-Time. The valuation of VOC reachs 7,9 trillion, taken from Tulip Mania period which the market cap of VOC reachs 78 million Guilders, or 7,9 trillion USD in todays money. Tulip Mania itself widely considered the world’s first financial bubble. This value worth as much as the sum of 20 world’s largest companies market caps, such as Apple, Microsoft, Amazon, Exxon Mobil, Berkshire Hathaway, Tencent, and Wells Fargo. All of them combined gets us to $7.9 trillion. Its indeed that VOC were considered as one’s of the first capitalist enterprises in the world. But maybe its not a good comparison to put VOC with these modern enterprise as this company wouldn’t succeeded without government support and it had an army and a navy it used to attack and intimidate, well its absolutely not a free trade.

VOC fleet victory over the Portuguese fleet for Banten, 1601 engraved by Bartholomeuw Dolendo (source: Rijksmuseum)

VOC history started in the beginning of 17th century, when the Europeans compete each others to dominate the world trade of spices. Its began in the where the country which just get its independence from Spain, formed Amsterdam based investment syndicate, with the dreams of vast wealth and spices from South-East Asia. They made the first attempt to Indonesia lead by Cornelis De Houtman in 1595, which despite is success to reach Banten, but ended disastrously with 142 casualties even De Houtman itself. The second attempt, lead by Jacob Cornelius van Neck as Dutch persisted planned to try to break into the existing trade network on equal term in South China Sea Region and Eastern Indian Ocean which consider  as trade hot-bed.  Though Van Neck said, "Not to rob anyone of their property, but to trade uprightly with all foreign nation”. In fact, free trade gave way to reality that competition meant lower prices. In 1601 there were plenty successful trade companies in Netherlands, hence the cost of buying spices in Indonesia was going up and also there was suddenly tons of pepper in Amsterdam which meant price that could be charged for that pepper was going down, something had to be done. Then in the same year, the representatives of Zeven Provincien body met at Den Haag and all the the provinces accept the single entinty to monopolize the East Indian trade, the VOC was formed. VOC was run by seventeen-member board called Heeren XVII and these director supposedly had control over company was chartered with the power to hire its own people and also to wage war. The reason behind is reasonable which is it took years for communication from the Netherlands to reach the East Indies and another years for company to respond. 

Jalan Letjend Suprapto a major artery in Kota Lama
(Old Town) Semarang, formerly Heerenstraat
possibly named after the Heeren XVII , the VOC board.

VOC basically operated as its own sovereign nation with power to use as much violence as it needed to build and maintain its trading power. VOC also different from a lot of corporations because it was intialy funded with 6,5 million Gulden or 100 million USD in todays money. The capital was expected to fund business ventures for a long time going forward. Its long term business thinking was uniques compared to the funding strategies of EIC and it reflected the advanced financial acumen of the Dutch model generally. Thus in 1648 the Netherlands were in better financial shape than any other countries in Europe which it could seen from its  Interest rate, although its not the only one to measures of financial health and power but they're an important indicator, even today. Dutch businesses could borrow at a rate of 4% annual interest, and its pretty cheap compared to England which applied 10% rate for corporation to borrow money. Dutch debt so much cheaper that they could invest two and a half times as much in pretty much anything than the English could, like an army, a navy and obviously gave Dutch a huge head start over their rivals. 

The nature of Dutch people carrying bonds, was begin long time before as its mostly investing their money in bonds that had been issued for land reclamation project like dykes and windmil that turned land below sea level. With the low interest rate, companies healthy and its gained more and more support from the Dutch people to invest, moreover the company tended to pay people back. This kind of fractional shares allow merchants to bear greater risks by purchasing smaller percentage shares in business ventures.  Dutch business people also enthusiastically invested in future markets, guessing what the price of pepper would be six months or a year from now and they created new financial instruments that could bought and sold and merchants purchased maritime insurance which further lowered their risk. Lower risk means anyone could invest more of your capital until eventually you have completely efficient market. The better Dutch financial instruments among others made they able to seized the lions share of the trading business

The ruins of Uitkijk (lookout), a place for the harbour master arrange the
traffic of Semarang old harbour before its moved into the Nieuw Haven
(new port) in 1880's. At the same place, once stood the first colony of Dutch
people, a fort called Vijfhoek.

Another reason of VOC was so successful was government sponsorship and centralization. Government support chartered by States General and it could count on the Dutch government for financial and military support, while the centralization was depicted in the way VOC had a single Governor General managing operation in Indonesia while British EIC was more like collection of trading posts which each competing each others for a shares of the spices.  Competition may bring down prices for consumers but it also bring down profit for business. 1605 VOC realized that if it really wanted to maximize its profits, it would need a monopoly of the worlds spice trade, and to do that they would need permanent bases in Indonesia.

VOC soon reached Banda Island, the only places at that time where nutmeg is grown, a commodity that once worth more than pieces of gold as its essential for food preservation process that really a big deal during this age of explorations.  The Bandanese welcomed the Dutch because they were more laid back in terms of religion than Portuguese, but Dutch ricked them to signed the exclusieve trade aggrements with Dutch. Its happens under the ruthless militay leader Jan Pieterszoon Coen which Between 1614 and 1618, secured a clove monopoly in the Moluccas and a nutmeg monopoly in the Banda Islands. Coen brought shift in VOC policy away from straightforward trade and toward monopoly of both shipping and production of spices. He also made it clear that this trade needed to be based on military force. Coen not only made VOC dominate trade of the spices but also its production as His plan depopulate the Banda islands to replace their inhabitants with imported slaves and indentured labor under VOC control, taken thousands lives of Bandanese and forced them to flee to another island surround it.

The Former Stadhuis (City Hall) of Batavia, currently serves as Jakarta Historical Museum or also known as Museum Fatahillah. The building that had a similiar shape as Paleis op de Dam in Amsterdam, reminiscing the glory of Batavia as important trade hub in South-East Asia.

The monopoly of spices trade over South East Asia region made the main port of VOC, established at the razed city of Jayakarta in 1619 became the most important port in all of the South East Asia, where spices from Indonesia , Gold and cooper and silver from Japan, Tea and porcelain and Silk from China all passed thorugh to India where they were traded for cotton, which was used to by more Asian goods. Its indeed VOC successfully became money-maker for the Netherlands and its brought this young country into its Golden Age as it depicted in Rembrandt and Ver Meer paintings about all the wealth and finery of Dutch people at that time. As We could see the trace now that all of the Canals and beautiful row houses in Amsterdam, many of them were built in 17th century.

source:
- Capitalism and the Dutch East India Company: Crash Course World History 229

- Banda The Dark Forgotten Trail (2017)

Candi Lama and its Bunch of Historic Building

The Y-junction in Candi Lama (Oud-Tjandi) in the intersection between Jalan dr. Wahidin (Tanah Putih Weg) and Jalan Sisingamangaraja (Kanarie Laan). Behind the reclame kiosk, its located the Hulp Post Kantoor building which until now still owned by PT. Pos Indonesia. (source: Tropenmuseum)

Around 1912, Major of Semarang, W. Th. De Vogel ask the architect K.P.C de Bazel who works in Amsterdam, Netherlands to made a plans for the Semarang city extension plans over the hilly area in its southern part, known as Candi neighborhood. This idea was based on the advice of one's of city council boards, Dr. H.F. Tillema, a pharmachist an enterpreneur who really concern on the hygiene problems. He stated that in Semarang city which consider as coastal city, its lower part were unhealthy. Its density and also the problems with the heat condition of Benedenstad, the plain part of the city which belongs to the city center combined with the high humidity, made its easily for the people suffers from heat fatigue. Thus, He advised several idea regarding the hygiene improvements project such as, sanitary improvements, tap water networks, and also the extension of the city into its hilly area in the south.   

The building of Heuvelschool, currently used as
Puskesmas Candi Lama. The photos taken in 2007.

In 1915, Directeur van Burgerlijke Openbare Werken (BOW), the Department of Civil Works asks Ir. Herman Thomas Karsten to designs the master plans to the new settlements area in this hilly area. The area then well known as New Candi, in Dutch known as Nieuw Tjandi or Candi Baru in Bahasa Indonesia, which still used until now.  Well, if these area given name as New Candi, so where’s the Candi Lama (Old Candi) located? Actualy, the area that in Dutch known as Oud Tjandi,  were a residence area that lies in the southern hilly part of Semarang, start from Tanah Putih, until Jangli area. The toponym of Candi which must be refers to temple were still a mistery until today. No one’s know for sure where the temples location that refers to this name, but there’s an ancient structure found in Candi Lama, in the shortcut way from Jangli to Karanganyar Gunung, nearby the Sendang, a natural water sources. Many peoples believed that this was the location of the temple that later became the toponym of this area.

Not so many discussion about Candi Lama neighborhood compares to Candi Baru neighborhood, which actualy it has a bunch of historical fact that for Me its also exciting. Once I met with Ron van Der Wal, whose His wife’s great grand-father, was the first headmaster of the first Heuvelschool (Hill School), the name was Mr. Goedhart. The Heuvelschool was still stand, and used as Puskesmas (smallest unit of people healthcare services provided by government) of Candi Lama. Across the Heuvelschool, was the location of Hotel Tjandi, a famous Hotel in Semarang that popular for its swimming pool. It was turns into the military compound after the indepence of Indonesia, and around 1990’s decades unfortunately its demolished. The house of Goedhart itself, was also interesting, since its later used as the Hulp Postkantoor, a post office branch that served the hilly parts of Semarang known as Heuvelstad. The buildings also still stand till today! Its even just renovated recently and maybe would be reused as another commercial function probably.

The only buildings that remains in Nederlandsch Indische Gas Maatschappij (NIGM) complex in Gang Schmalz (currently Jalan Singotoro Raya), Candi Lama. Some people said that behind this building, there was two large tank made of steel. Its probably part of the gas instalation in the past, but unfortunately its gone.

The family portrait in front of the house in Candi
Lama, taken around 1916-1920. This Tudor-style
house is still preserved, made it the only buildings
with Tudor-style remains in the neighborhood.
(source: Tropenmuseum) 

There’s a street in Candi Lama neighborhood known as Gang Semal, which actualy taken from the old names of this street, Gang Schmalz. Many of the residents surround it, or even Semarang people still called the street as Gang Semal, although oficialy the name is Jalan Singotoro Raya. There’s a lot of historical building surround here, like Sanatorium and the Nederlandsch Indische Gas Maatschappij (NIGM) complex. The NIGM complex, there’s a big possibilities that before there’s a gas power plant set up here. Before the electricity installation based on cable, they used the gas network fueled by coal to enlightened the street and house. The gas power used as electricity means in Semarang was mentioned in De Locomotief, the prominent newspaper based on Semarang that in February 2nd 1898, in Semarang succesfully set 15 gas instalations in order to fulfilled the need for street lighting.  The complex of NIGM itself only leaving one building remains. The building once turns into a famous café in Semarang, Ours Café where one’s of the city Jazz community, Jazzngisoringin established in 2009 through its routine agenda of organizing Jazz gigs in the small stages under the Beringin tree (latin: ficus benjamina) on its yard. Unfortunately, its closed in 2010 and left the building neglected until recently the owner which is now PT. Gas Negara made a little renovation. 

There’s much more old building that interesting to see in this neighborhood such as the building nearby the Y-junction of Jalan dr. Wahidin and Jalan Sisingamangaraja (before known as Kanarie Laan, since a lot of Kenari trees over here) which consider as the only building with Tudor style that remains in Candi Lama. Also the art-deco house that designed by Liem Bwan Tjie that situated near the junction of Jalan dr. Wahidin. The house with its steeping entrance for sure has a best view towards the Java Sea and the lower part of Semarang among the others building in the neighborhood. The Badjak Bron a natural water resources that once served pipeline water network in several area in South Semarang its also located in Candi Lama. The water sources nowadays still used by the people in Karanganyar Gunung neighborhood. Wish it always be preserved anyway.

Semarang Golf Club (SGC) in Memories

Golf courses at Tjandi Sport Club, Semarang, later known as Semarang Golf Club (SGC) taken by E. Veltman in 1937.
(sources: nga-earlygolf.nl)

The current condition of club house at Tjandi Sport Club.

Golf as a sport has long been known in here Indonesia since the colonial period. The tropical climate makes golf in Java, unfortunately, to a seasonally game. During the so-called dry seasons, dry fairways, greens and grass is made it hard to be played, only a few peoples still continue to play. At that time of course neither automatic sprinkle to keep the grass greens during the dry seasons nor golf car to made the mobility easier invented. Therefore, the golf competitions in the old days were held in all the clubs in Java during the months of November to May, during the wet seasons. Until 1937, in Dutch Indies there were several cities already which have golf courses as follows; Batavia in Bukit Duri, Bandung, Semarang, Buitenzorg (currently Bogor), Tegal, Malang, Cheribon, Garut in Ngamplang all of them consist of 9-hole courses. Surabaya golf courses in Gunungsari, the only golf courses with 18-hole courses, but soon in the year of 1937, Batavia will built its new golf courses in Rawamangun, also in 18-hole courses to changed its old ones in Bukit Duri.

Date back in 1872, the Jakarta Golf Club was the oldest Golf Club in Southeast Asia. The original name of the golf club was known as the Batavia Golf Club and the founders were Mr. A. Gray and Mr. T.C. Wilson from Britain. In the early days of golf in Dutch Indies (Indonesia during colonial period) , golf barely only played by the British expatriates. Only a little Dutch people enthusiast in this kind of sports. But as the time goes by, golf became more popular among the people in Dutch Indies.  Also in Semarang, which is at 1895, the Tjandi Sport Club founded.  Located in Kanarielaan (currently Jalan Sisingamangaraja) which is in the guide book titled Semarang vooruit published in 1935, it described the golf course as excellent at not only from the standpoint of the golfer, but also in terms of natural beauty and listed among one of the best recreations after a day of hardworks. The Tjandi Sports Club were not only consist of a golf courses but also some other sport. There available grasscourt tennis and also cricket arena! Well no wonder its also mentioned that most of its member were british. Tjandi Sport Club have a short but interesting 9-hole course and its also a club house on the north part of the golf courses. Tjandi Sports Club got its historical moments while in 1901, the first golf club championship in Dutch Indies were held here.

The golf courses area, currently in progress to be build as a real estate, Green Candi Residence.

After the Independence, the golf courses in Tjandi Golf Club changed its name into Semarang Golf Club (SGC). Its remains to serves people in Semarang until 2006, when the city municipality decide to moved it to the bigger golf courses in Gombel hill. The plans actualy gained protest from the peoples surround it who most of them got the livelihood from SGC. But the plans executed anyway, the golf courses then unfortunately demolished and on the land above it built real estate of Green Candi Residence. Only the club house survived until today, but its badly damaged because of its neglected right after the SGC closed. There’s no guarantee also until when it will be still stand there cause its not yet listed as the heritage building of Semarang City. A sad fate for the place with a significance historical values where , the first golf club championship in Dutch Indies/ Indonesia have held!

Source: Golf Magazijn, "Officieel Orgaan van het Nederlandsch Golfcomité". 1e Jaargang No. 8, 15 October 1937

Borsumij Building, the only Legacy of J.F.L Blankenberg in Semarang

Borsumij Office of Semarang in 1939, shortly after its finished. The contrast between the old-colonial architecture of Koepelkerk, and the modern art deco of Borsumij.

(source: Locale Techniek, 1940)

In the middle of 1938, a fifty’s-years old architect, Johan Frederik Lodewijk Blankenberg was asked by the N.V. Borneo Sumatera Maatschappij (Borsumij) to designed their new office buildings in Semarang. Blankenberg, whom at that time were the chairman of  Nederlandsch-Indische Architectenkring (NIAK), accept this offers. Here, Blankenberg as its requested by Borsumij, have to designs the office similar with what His fellow architect, Cosmas Citroen had done in Surabaya that had designed their office also in 1934. In His opinion, Blankenberg agreed that the Citroen designs for the Borsumij building in Surabaya gives it the best of the best of modern office building in Dutch Indies (Indonesia during colonial period), as it already addressed in advance to the maximization of space, function and natural lighting. 

The plaque in the entrance of  the Borsumij building of Semarang. 

The Borusmij building in Semarang, located in the centre of the Kota Lama area, in its main road, Heerenstraat (currently Jalan Letjen Soeprapto) and next to Koepelkerk, the landmark of Kota Lama. The building, seen from outside maybe just like another art-deco building built in colonial period but inside it, were remarkable.  The materials inside, its floor, wall, stairs, stained glass and pillars so colourful. The marble floors colour . The stairs decoration used the colour of Arabescato (creamy green with black veins) when the walls were in Rosso Levanto (dark red with white veins), both Italian marbles.  The columns coated in lead glazed black colored moldings, when the basement used the gray green granite plester. At the entrance, there were friezes and ceramic plaque stated that the first stone of the construction laid by M.C . Albert-Rauh, the wife of the Borsumij Agent of Semarang in Ferbuary 4th 1939. Construction was by the Firm. Ooiman and van Leeuwen in Semarang and after ten months, in October, its finished. The construction costs approximately ƒ 150.000.- (almost 12 billion rupiahs in the current value) for office and the new warehouses on the norths if the office.

One's of the Borsumij new warehouses building, located on the north
of the offices. This warehouse also designed by Blankenberg and built
in 1939.

Borsumij itself was a one’s of the major company in Dutch Indies at that times, its even considered as one’s of top big five companies in Dutch Indies along with Nederlandse Handel Maatschappij (NHM), Geo Wehry, Lindeteves Stokvis and Jacobson van den Berg. It was founded by J.W. Schlimmer, agent of NHM at Banjarmasin (East Kalimantan). In 1883, at a time when NHM shifted its attention to banking rather than commodity trade, Schlimmer took over the NHM facilities in the region and began his own company, Schlimmer & Co. In 1894 it became a limited liability company under the name of N.V Borneo-Sumatera Maatschappij (Borsumij) with its headquaters at 's-Gravenhage (another name for The Hague, then its no longer used after the city municipality start from 1990 to consistently using Den Haag/ The Hague as the official name), Netherlands. Beside Banjarmasin, it opened offices at Pontianak and Medan. The company came to hold a monopolistic role in the commodity trade in Kalimantan and Sumatera, related to the name of the company. As there were no large credit institution during these early years, Borsumij was able to succesfully expand its business. The company thereupon invested heavily in agricultural and mining estates, specifically rubber and coal. By the late twenties decade, Borsumij acquired large rubber sources and became direct supplier to Goodyear at Singapore. In the early 20's century, Borsumij also became major export-import company, and its made the company growth bigger. Borsumij ended their fate as big company in 1958, while its nationalized by Indonesian Government following the West Papua Crisis. The company then became state-owned company until nowadays, and its asset managed by PT. Perusahaan Perdagangan Indonesia (PPI).

Source: 

1. Locale Techniek, 1940, volume 009, issue 001
2. Commercial Networks in Modern Asia by Linda Grove and Shinya Sugiyama