Over the course of the 19th century, the world economy was shaped by an increasing dose of globalization. This was not a new trend. However, for the first time, the world economy was also subject to simultaneous liberalization. International trade had been very restricted up until the early 19th century, the preserve of state-backed official trading companies in Europe and restricted to specific ports in Asia. However, from the mid-19th century on, trade was increasingly accessible to any aspiring merchant. Some firms, like that of the Bombay-based Sassoon family, became very large, both in terms of financial resources and geographic scope, within the span of a few decades. However, wealth invested in trade can be easily lost and the Sassoon fortune did not survive long into the 20th century.
The Sassoon family’s history in trade begins with David Sassoon. The son of Sheikh Sassoon ben Saleh, merchant and treasurer to the Ottoman governor of Baghdad, David Sassoon was born in 1792. He worked at a Baghdad bank until 1822 around which time the family fell out of favor with the Ottoman governor of the city. David Sassoon was driven out of Baghdad and eventually the Ottoman Empire altogether, fleeing Iraq for Persia a refugee, leaving behind everything except his contacts with local merchants.
David Sassoon eventually wound up in Bombay, now Mumbai, in the 1830s. The city was then already a commercial center in the cotton and opium trade. David learned Hindustani in addition to the Arabic, Hebrew, Turkish and Persian he already spoke and got to know traders in the city’s cotton market, complementing his list of contacts from the Ottoman Empire and Persia. He began trading in textiles but David Sassoon was not yet considered among the city’s leading merchants; few city records from this period give him a mention. David Sassoon was nonetheless active exporting textiles to Persia, the Ottoman Empire, and the Persian Gulf and selling products from these countries in India.
A distant conflict with ramifications even in India would change the direction and scale of his business. The First Opium War of 1839-42 ensured China remained a market open to the opium trade, a drug the Chinese government had tried to keep from entering the country. The war was fought primarily to force more of China open to foreign merchants. The Treaty of Nanking in 1842 opened more Chinese ports to foreign trade.
David’s second son Elias Sassoon was accordingly dispatched to China in 1844; the first of the family to travel there but far from the last. David and Elias became the dominant merchants in the now-liberalized opium trade. The drug, then prescribed for genuine medical purposes as well as subject to widespread abuse, made the family wealthy. The monopoly of the East India Company now terminated and Chinese ports opened to trade, China became connected to India and Europe through the activities of merchants, like the Sassoons, who imported opium into China and exported tea and silk.
The Sassoon family diversified into property, insurance, and banking. David’s eldest son, Abdallah Sassoon, developed the Sassoon Docks in Bombay. However, this diversification was not confined to Bombay. David Sassoon had fourteen children, some of whom went abroad. One of his sons, Sassoon David Sassoon, went to London. His eighth son Frederick David Sassoon spent most of his working life in Hong Kong. Besides these destinations, branches of the family’s mercantile business were founded as far away as Shanghai. A history such as this led the family to be known as ‘the Rothschilds of the East’. In 1853 David Sassoon became a British citizen despite never learning English or setting foot in Britain.
The family’s success was not diminished by a split in the business between the two eldest sons of David Sassoon after his death in 1864. Abdallah took control of David Sassoon & Co. and developed a silk, cotton, and woolen manufacturing business centered around Bombay. Elias established E.D. Sassoon & Co. in 1864 which opened its own offices in Bombay, Shanghai, Hong Kong, and London and operated tea plantations in Sri Lanka, where Elias would die in 1880; in time, his branch of the family business would shift its focus to China.
In any case, the two companies did compete and this was not the only new challenge that threatened their success in the 1860s. There was a significant downturn in the cotton market in the mid-1860s as the return of American supply after the country’s civil war brought down prices. Still, the Sassoon businesses grew in the late 19th century.
The family did sponsor several philanthropic endeavors. They set aside 0.25% of each transaction for philanthropic purposes. Considering that not all trades were profitable and margins are typically small in most trading businesses, this is not as insignificant as it seems. This money was given to projects which tended to focus on providing relief to the poor and young in Bombay. David Sassoon established a synagogue and a school for Jewish children and donated to famine relief funds. Abdallah Sassoon created university and art school scholarships.
David’s eldest son Abdallah Sassoon received a knighthood in 1872 and took the name Albert. Two years later, Sir Albert Abdallah Sassoon relocated to London. He was not the first Sassoon to settle there. His half-brother Sassoon David Sassoon had already left for London in 1858. The family purchased an estate, Ashley Park, and even came to count royalty among their friends as Abdallah befriended the future King Edward VII. The family used this influence in London to lobby against restrictions on their eastern opium trade. In time though, these restrictions arrived as public sentiment against the business grew.
Abdallah Sassoon’s son Edward married the daughter of Baron Gustave de Rothschild and became a Member of Parliament. His son Philip later became a Member of Parliament for the same constituency and served both as the private secretary of Field Marshal Douglas Haig, commander of British forces in France during the First World War, and later as an aviation minister in the British government. After Abdallah, many Britain-based Sassoons eschewed work in imitation of the aristocracy. An exception would have been Rachel Sassoon who edited the Observer and the Sunday Times newspapers.
Meanwhile, another of Abdallah Sassoon’s half-brothers, Solomon Sassoon, ran the company’s many operations in Bombay, which ranged from manufacturing to insurance. He died in 1894. His wife Farha Sassoon then managed the company until 1901. By now, the family became less involved in business. That a woman would be leading such a company over a century ago was to some extent a reflection that there were few alternatives, at least among members of the Sassoon family.
The turn of the century also marked the beginning of the end for the source of the family’s fortune. Opium profits began to fall in the 1890s and the legal trade was virtually abolished in the early 20th century as the result of agreements between China and British India to control the drug.
Not a lot has been said of the family’s presence in China other than fleeting visits and an arguably exploitative trade. However, it was here where the Sassoons’ last big business gamble was made. Victor Sassoon, who led E.D. Sassoon & Co. starting from 1924, was souring on India. Believing China to be a better bet, he transferred much of the Sassoon fortune he controlled to Shanghai.
Recall that the Treaty of Nanking in 1842, which had sent Elias Sassoon to China, had opened Shanghai to world trade. Sassoon David Sassoon had also lived in Shanghai from where he managed the Chinese branch of the family business before he left for London. The Sassoons had remained active there, exporting tea and silk in exchange for opium but they also expanded into banking, shipping, and managing public utilities. With the money he brought, Victor Sassoon invested in property and hotels in the city; he owned the tallest building in Shanghai, the Cathay Hotel. In the process of running his China-based company, Victor gave work to Jewish refugees in the country.
The midcentury years proved brutal. The Japanese invasion of China and the Communists’ victory in the civil war meant Victor Sassoon had essentially made a bad bet on the country. Much of his wealth lost, he retired to the Bahamas. Just like Philip Sassoon, who was the last Sassoon to take a leadership role in the David Sassoon & Co. branch of the family, Victor Sassoon had no children. From here, the two firms, both E.D. Sassoon & Co. and David Sassoon & Co. withered away.
The story of the Sassoons charts the rapid growth of a family firm into a global business. This story was extraordinary but not unheard of in this era of globalization. The story is one that fits the 19th century particularly well because the 19th century was not just one of globalization but one of liberalization. Trade connected Europe to China in earlier centuries but this trade was then monopolized by official trading companies and conducted out of a few permitted ports. Trading volumes were also quite small. Only after the mid-19th century can one imagine the Sassoon companies taking off the way they had.
However, the business crumbled when members of the family became less interested in running it. Such is the problem with family businesses that if members of the family become disinterested, the business fails to progress on autopilot. Trading firms especially must constantly adapt to changes in markets and this requires the fairly constant attention of talented and interested managers.
More from the Tontine Coffee-House
Read about the Shanghai rubber boom, in which the Sassoon firm was active, and the agency houses which arose in an earlier era in India. Consider subscribing to this blog’s newsletter or checking out book recommendations, which include many of the sources often referenced in my posts.
1. Hyams, J., et al. “Sassoon.” JewishEncyclopedia.Com. Accessed 20 Aug. 2023.
2. Meyer, Maise. “Baghdadi Jewish merchants in Shanghai and the Opium Trade.” Jewish Culture and History, vol. 2, no. 1, 1999, pp. 58–71.
3. Philpot, Robert. “The Rise and Fall of the Opium-Fueled Sassoon Dynasty, the ‘Rothschilds of the East.’” The Times of Israel, 26 Nov. 2022.
4. Rubinstein, William D., editor. Palgrave Dictionary of Anglo-Jewish History. Palgrave Macmillan, 2011.
5. Sassoon, Joseph, and Dean Joel Hellman. “Book Talk | The Sassoons: The Great Global Merchants and the Making of an Empire.” Mortara Center for International Studies, 21 Nov. 2022.
6. Sassoon, Joseph. The Sassoons: The Great Global Merchants and the Making of an Empire. Pantheon Books, 2022.