Arthur George Gaston Sr., who was born on July 4, 1892, in a log cabin as the grandson of a slave, overcame the Jim Crow South’s prejudices to become one of America’s most successful and complex black businessmen.
Generations of African American businesspeople have drawn inspiration from his strategic acumen and unwavering tenacity, including John H. Johnson, the media mogul who founded Ebony and Jet magazines, and Henry “Hank” Aaron, the baseball great who built his own empire of car dealerships and fast-food restaurants and the most recent recipient of BE’s highest business honor, which aptly bears Gaston’s name.
“I wanted to be similar to Mr. Gaston,” Aaron told BE.
“I watched him and tried to find out what it took for him to be the kind of man that he was. I said, ‘This man is very successful, and not just because he’s making money but because he’s able to share it with other people.’”
Building His Business Kingdom
Having just completed the tenth grade, Gaston enlisted in the Army during World War I. He served in the military and then worked for a coal company in Birmingham, Alabama. He was committed to starting his own business.
Years later, he would advise, “Start someplace.” By the time he passed away in 1996 at the age of 103, he had done all of that and more, amassing a wealth worth more than $130 million.
A savings and loan bank, business college, construction company, motel, real estate company, burial insurance company, two cemeteries, and two radio stations were all part of Gaston’s expansive corporate empire. A.G. Gaston, the founder and chairman of the Alabama-based BE 100 companies Citizens Federal Savings Bank and Booker T. Washington Life Insurance Co., is the only businessperson to have received the title of BLACK ENTERPRISE Entrepreneur of the Century. He did so in 1992, marking the 20th anniversary of our ranking of the largest black-owned companies in the country. He argued that being wealthy was “accidental” in his interview with BE for the piece with the same name. According to that story, he only made an effort to meet the needs he noticed in the neighborhood.
The Booker T. Washington Burial Society, which offered reasonably priced burials to coworkers, was established by Gaston in 1923, marking the beginning of his entrepreneurial career. As a result of Gaston’s connections with local black clergy, who directed their followers to the business, the enterprise expanded quickly. By supporting gospel musicians and Alabama’s first black-focused radio program, the trailblazing businessman also attracted customers.
Economic Self-Determination
In order to market life, health, and accident insurance, Gaston established the Booker T. Washington Insurance Co. in 1932. The company was named after his hero, a proponent of “black economic self-determination” who founded Tuskegee University and the National Business League in 1881 and 1901, respectively, and served as a presidential advisor. With the help of his financial acumen, he added funeral insurance, undertook projects, produced caskets, and sold burial sites to generate new sources of income. Gaston founded the Booker T. Washington Business College in 1939 after noticing a shortage of competent clerks and typists in his day-to-day business operations.
He identified further niches and added businesses to fill them. The A. G. Gaston Home for Senior Citizens, WENN-FM and WAGG-AM radio stations, S & G Public Relations, and Vulcan Realty and Investment Co. were among them. The Citizens Federal Savings and Loan Association, the first black-owned financial organization in Birmingham, was established by Gaston in 1957 as a result of black people in Birmingham having difficulty obtaining loans. At the age of 94, around 30 years later, he still had the energy to add the A. G. Gaston Construction Co. to his holdings.
But it wasn’t a stroll in the park for the multifaceted businessman. Using his riches to support the civil rights struggle, Gaston even brushed down claims that he was a “Uncle Tom.” He was viewed as being overly cautious and moderate during the Birmingham civil rights movement’s height in the 1960s. “A Martin Luther King of economics who will fire the people up like they are getting fired up for civil rights,” Gaston said, was what black people needed. “Achieving first-class citizenship is useless if you come penniless.”
Paying It Forward
He started his businesses in part to create forums to educate African Americans about business and finance as they had been denied access to such education for a long time. In fact, BE named Booker T. Washington Insurance Co. as the most inventive business in the management category when the 95-year-old Gaston, who owned 97% of the company and sold it to the 400 employees for $3.5 million, or a tiny fraction of its value, sold the company, which had $35 million in assets and $276 million in active insurance, to them.
Such a step at the time was essentially unheard of for founding businesspeople, black or white. By 2003, the Atlanta-based Citizens Trust Bank had combined with the Citizens Federal Savings Bank to form a larger organization with a majority-black ownership structure under Citizens Bancshares Corp.
Had the trailblazer been alive to witness the merger of two black organizations, it is safe to say that the deal would have made him smile. Today, No. 5 on the BE Banks list with assets of around $396 million, the institution would have made him happy.
Gaston received a lot of honors throughout his life. The A. G. Gaston Lifetime Achievement Award is given annually by BLACK ENTERPRISE to a trailblazing African American businessperson or philanthropist. It makes sense that it was given that name in honor of the famous figure who once remarked, “Money is no good unless it offers something to the community…unless it builds a bridge to a better life. Money can be made by any guy, but it takes a specific kind of man to manage it well.