Who makes the money in a Gold Rush?
21st of September, 2020
My wife is Australian. Specifically, she was born and raised in Norseman, a gold mining town in the heart of Western Australia.
The discovery of Gold in Australia is a recent event, with gold fever gripping the country in the 19th Century. There were three phases in every “rush”.
Phase 1 – The Prospectors
Pioneers set off into the desert with hope, skill, and belief that there was gold. Some knew what they were looking for, others were just plain lucky. For example, Norseman is named after the horse ridden by Lawrence Sinclair who discovered gold there in 1894. The story goes that Hardy Norseman kicked over a gold nugget, and the discovery was made.
Those that found gold nuggets on the surface became rich. Word would spread, and the Followers would form Phase 2.
Phase 2 – The Pioneers
On hearing the news that Gold had been discovered, Pioneers would move into the area. The nuggets were harder to find, so they staked out a parcel of land and started to dig. Some Pioneers (like my wife’s family) set up businesses to support the Diggers, but most would look to find Gold where it had already been discovered.
Meanwhile, the Prospectors, having taken most of the easy gold on the surface, moved on. Knowing what to look for, they would prospect other areas. If they were lucky and skilled, they would find more surface gold.
When word spread back to the Pioneers, many of them would down tools and move to the new area. They left part dug workings (that you can still see today if you visit Norseman), and followed the herd to the new discovery. There, they staked out a parcel of land and started to dig.
This left room for the third phase. The miners.
Phase 3 – The Miners
A third wave of people moved into the abandoned workings after the Pioneers had moved on. These were the people we know now as Miners.
The Miners took over the part-dug holes and they dug deeper. They kept digging, extracting all the gold they could. They developed new technologies to enable greater extraction, including the processes involved in extracting gold from ore. They mechanised, systemised, and kept digging.
And who do you think made the most money?
Well, there were some Prospectors who made a fortune. And there were many who never found a single gram of gold. There is no doubt that those who discovered the nuggets on the surface made immense wealth.
The real money was made by the Miners. Those who found a seam of gold and kept digging. Those who focused, looked for improvements, and were not distracted by the rumours of quick wins elsewhere.
And the Pioneers? Having followed the Prospectors to pastures new, and then found that the Miners were extracting gold from their previous workings, many returned and tried to restake their claims. I recommend the book, “Gold!” by David Hill (published by William Heinemann, 2010 - https://www.amazon.co.uk/Gold-David-Hill/dp/1741669251) if you can track down a copy for the full story.
So what can we learn from this for our business or charity?
In my experience, very few people discover something that is genuinely new. Even those that do are credited with this discovery in hindsight. Many more went before but did not realise scale.
Many of us flit between Miner and Pioneer. My advice is to be more of a Miner.
If you find something that works, do more of it. This is the philosophy that underpins Mining and is central to Solution Focused Practice to this day.
It is all too easy to be distracted by something shiny. Rumours of gold “over there” distract us from concentrating on what we know already works. If you are chasing the easy money, it is unlikely you will find it. Most Pioneers died penniless, or took jobs in Pioneer businesses and set down their tools.
Meanwhile, it was the Miners that made the most money by far. The Norseman mine ran for over 100 years. One of the biggest gold deposits in the world is in Kalgoorlie-Boulder, 200km North of Norseman. Discovered by Paddy Hannan in 1893, the mine is still in production today and “The Superpit” is the largest man-made hole on the planet!
So if you find a nugget, recognise your good fortune.
If you find a seam of gold that yields when you dig, keep digging. Find what works and do more of it.
And if you are distracted by someone else’s shiny things, ignore them. Find your own seam and keep digging.