In 1514, there was an opening for the archbishop of Mainz, the most powerful position in Germany save for the emperor. Such posts required payoffs, and only one man had the money to finance such an important elevation.

Albrecht of Hohenzollern, whose family ruled much of the country, wanted the job, and turned to banker Jacob Fugger, then the richest man in the world, to loan him the money.

Pope Leo X, who had previously “squandered the papal treasury” on his coronation and “hosted parties where prostitutes looked after the cardinals,” was charging 34,000 florins for the job — roughly equivalent to $4.8 million today — and Fugger deposited the money directly into the pope’s personal bank account.

To repay the loan, Albrecht’s men decided to use the proceeds from selling indulgences, an idea Pope Leo — who “understood better than anyone the ability to fleece the faithful,” and who once said, “How very profitable has been this fable of Christ” — supported.

But fleecing the faithful, like any good con job, required a cover story, and the pope provided it via St. Peter’s Basilica, which conveniently needed an expensive upgrade.

“He was the first documented millionaire, and the first businessman to compile a comprehensive financial statement for his business.”

The pope announced the sale of indulgences for the renovation of the Basilica, and the sales effort was led by an “indulgence peddler” who “carried Bibles, crosses, and a large wooden box with …a picture of Satan on top,” and told worshipers that his indulgences “cancelled every sin.” He even offered a “progressive fee schedule,” with royalty paying 25 florins and everyday laborers just one.

The money raised was split 50/50, with half going to the pope, the other half to Fugger.

Despite its profitability, the indulgence sale would have earth-shattering consequences, as it inspired a reformer named Martin Luther, who was appalled by it, to write “ninety-five arguments against indulgences, his famous Ninety-Five Theses,” which began the movement that would lead to the Protestant Reformation.

First true capitalist

“The Richest Man Who Ever Lived,” a new book by veteran journalist Greg Steinmetz, shows that it’s hard to overstate the effect Jacob Fugger had on the world, both during his time and in the centuries since.

Born to merchants, not royalty, Fugger could be seen as the world’s first true capitalist, as his pursuit of wealth solely for wealth’s sake — as opposed to desire to rule, or to fulfill perceived religious destiny, or to simply escape from poverty — was, according to Steinmetz, virtually unheard of at the time.

Fugger created a fortune that, by his death in 1525, equaled “just under 2 percent of European economic output.” No other man, no Vanderbilt or Gates, has controlled that pivotal a fortune.

He was the first documented millionaire, and the first businessman to compile a comprehensive financial statement for his business. He also created the world’s first news service, as a way to ensure he had important information before his rivals, a half-century before the advent of the newspaper.

He funded the appointments of kings and popes then backed their wars, and took the Habsburg family from royalty’s second tier to a dynasty that would lord over Europe for hundreds of years.

His loan to Albrecht directly led to the creation of Protestantism, and, according to Steinmetz, he “most likely funded Magellan’s circumnavigation of the globe.”

Such was Fugger’s power that, in a letter seeking repayment of money he had loaned to King Charles V — the Holy Roman emperor, king of Spain, Naples and Jerusalem and “lord of Asia and Africa” — he had no qualms about reminding the all-powerful king, in an era when kings put people to death with a wave of a hand, that, “without me your majesty might not have acquired the imperial crown” and demanding payment “without further delay.”

For these reasons and more, Steinmetz makes the persuasive case that Fugger was “the most influential businessman of all time.”

The archduke gamble

Jacob Fugger was born in 1459 in Augsburg, Germany, a bustling city of the time where “markets overflowed with everything from ostrich eggs to the skulls of saints,” and “ladies brought falcons to church.”

Fugger’s family were peasants who became wealthy as cloth merchants. Still, an early Fugger apprenticeship in Venice, then “the most commercially minded city on Earth,” found him sleeping “beside his countrymen on a straw-covered floor in the attic.”

He wound up in Austria, hoping to get in on the mining boom of the time. But the mines were owned by Archduke Sigmund, a member of the Habsburg family and cousin of the emperor Frederick.

Sigmund was a wastrel with money — he spent nothing on his subjects and everything on lavish parties such as one where “a dwarf jumped out of a pie to wrestle a giant.” He financed his life by taking out loans.

“Fugger created a fortune that, by his death in 1525, equaled “just under 2 percent of European economic output.” No other man, no Vanderbilt or Gates, has controlled that pivotal a fortune.”

“When money ran out,” writes Steinmetz, “he borrowed against the output of his mines by selling silver to a group of bankers at a discount.”

Fugger was able to get involved in one borrowing spree, lending the archduke 3,000 florins and receiving 1,000 pounds of silver at eight florins a pound that he would later sell for 12. It was a piddling amount compared to those lent by others, but it solidified his relationship with Sigmund and the Habsburgs and allowed him entry into mining. It also kickstarted Fugger’s career as a banker.

Years later, during a military skirmish with the more powerful Venice, Sigmund’s financial irresponsibility had made him persona non grata to the larger bankers. Desperate, he turned to Fugger, who combined his family’s fortune with every dollar he could raise to lend the monarch 100,000 florins.

Throughout the book, Steinmetz makes the point that for all Fugger’s talents in business, the one most responsible for his success was his tolerance for risk.

This was the first example.

Fugger placed tough conditions on the loan, including forbidding Sigmund from repaying it with silver from his mines and giving Fugger control of the state treasury.

If Sigmund paid him back, then Fugger would walk away with a fortune. But if he didn’t — and given Sigmund’s track record, this is what every banker was convinced would happen — Fugger would be ruined.

The other, larger bankers scoffed at Fugger’s stupidity, but the scoffing stopped when “wagons loaded with Sigmund’s silver roll[ed] up to Fugger’s warehouses.” Fugger was now a far wealthier man and a trusted friend to the local ruler.

Journalists and popes

Sigmund was soon eclipsed by Frederick’s son Maximilian, who had arranged to take power if Sigmund did not pay back money he owed him. (Fugger could have lent Sigmund the money to keep him in power but decided he’d prefer Maximilian in the position.)

Fugger bought valuable land with his silver profits, then financed Maximilian’s effort to take Vienna. The emperor also opened Hungary, a primary region for copper mining, to German business, and Fugger bought and reconfigured the country’s mines.

Between mining and banking, including serving as the emperor’s private banker, Fugger’s wealth blossomed. Desiring every advantage in business, he set up a courier system for the purposing of delivery news solely to him — such as important “deaths and battle outcomes” — so he’d have it before anyone, including the emperor. These updates came to resemble newspapers, but predated the first newspaper by half-century.

In a show of his increasing power, when Maximilian, under pressure from the other bankers, cut Fugger out, Fugger put pressure on influential dukes and bishops to make Maximilian relent. The final straw came when Fugger persuaded a bishop who had lent Maximilian a large sum to recall the loan. The only person with the resources to get the emperor out of the jam was Fugger, who was quickly back in the emperor’s good graces.

Over time, Fugger took control of “the business of transferring collection plate donations from Germany to Rome,” making him “God’s banker, the top financier to Rome. He took it upon himself to pay Swiss mercenaries to protect the pope, starting the tradition of the Swiss papal guards.”

He also “contributed 4,000 ducats (5,600 florins) to the papal campaign of Julius II and greased the cardinals’ palms to get him elected. Julius showed his gratitude by awarding Fugger the contract to mint the papal currency. Fugger served seven popes and minted the coins for four of them.”

Taking his 10%

Fugger changed the world in profound ways. For instance, charging interest on loans, or usury, had long been considered a sin. Fugger was responsible for changing this, as to further his business, he “wanted the church to expressly legalize interest.”

He conducted a full-on public relations campaign, including setting up debates on the issue, and wrote an impassioned letter to Pope Leo. As a result, Leo issued a decree proclaiming that charging interest was usury only if the loan was made “without labor, cost or risk” — which no loan ever really was.

“Leo’s decree was a breakthrough for capitalism,” Steinmetz writes. “Debt financing accelerated. The modern economy was under way.”

When Turkey invaded Hungary in 1514, Fugger was gravely concerned about the value of his Hungarian copper mines, his most profitable properties. After diplomatic efforts failed, Fugger “gave Maximilian an ultimatum — either strike a deal with Hungary or forget about more loans. The threat worked.”

Maximilian negotiated a marriage alliance that left Hungary in Habsburg hands, leading to “redrawing the map of Europe by creating the giant political tinderbox known as the Austro-Hungarian Empire. Fugger needed a Habsburg seizure of Hungary to protect his holdings.”

“The Habsburg triumph was equally Fugger’s triumph,” writes Steinmetz. “His efforts had united two kingdoms and stiffened the front lines of Christendom against the Turks.”

When Maximilian died in 1519, the election to succeed him as Holy Roman Emperor came down to France’s King Francis, and Spain’s teenage King Charles. The victor would be the man who could deliver the best bribes to the seven electors.

But while Charles was a Habsburg, Fugger had not built a relationship with him, and Charles was prepared to shut him out. Fugger “couldn’t let that happen,” as “a loss would not only embarrass him but could endanger his empire. The Habsburgs might cancel his [mining] contracts if he backed France.”

Fugger decided to use his tremendous wealth to “bid up the price.”

“He could offer a candidate more money than anyone,” Steinmetz writes. “He could push the price of victory so high that no one else could compete. His competitors would drop out and he would be the only banker left.”

Fugger gave the impression that he was backing France, in hopes that Charles would see that to win, he needed Fugger by his side.

Such was Fugger’s immense power that “he wanted Charles to understand that he, not the electors, would decide who became emperor, and that if he backed Francis, the Habsburgs would lose the Holy Roman Empire — the largest political jurisdiction in Europe — and their hopes of global domination.”

The inheritance

That’s exactly what happened. Francis, understanding Fugger’s importance first, asked to borrow 369,000 florins from him, with a 10% commission. When Charles finally realized his error, he agreed at the last minute to borrow from Fugger.

Charles won, at a cost to Fugger of 544,000 florins — the largest loan in history at the time, roughly $76 million today.

Fugger died in December 1525, at age 66. An accounting of his business released several years later placed his final wealth at 2.02 million florins.

Seventeen generations later, during World War II, his descendants were still living off income derived from the business he built.