Things in California have not changed much over the last few hundred years. Just like in the 1800s, Californios are still selling shovels in a gold rush. The first reported millionaire in California accumulated his fortune doing exactly that. When gold was discovered at Sutter’s Mill in 1848, Samuel Brannan decided it would be a good idea to publish this discovery with great enthusiasm while simultaneously stocking his store with mining supplies at inflated prices. Funny how this has not changed much, except the gold is now AI, and we have thousands of people following Mr. Brannan’s playbook.
I do not think there is anything wrong with getting rich selling shovels during a gold rush. The charlatan, however, gets rich selling shovels and then claims he made his fortune digging gold. A great example of this is Henry Vizetelly and his 1849 book Four Months Among the Gold-Finders in Alta California. This man was from London and a decent publisher and journalist. During the height of the gold rush that Samuel Brannan was encouraging, this prospector’s diary was published. Vizetelly published this journal about a character named J. Tyrwhitt Brooks, M.D., who went to California, prospected for gold, made a fortune, and described what life was like in the mining camps. This was the gold rush equivalent of a YouTube channel.
Brooks didn’t exist. And Vizetelly had never been to California. Vizetelly wrote the whole thing in London, combining published reports with his imagination. And it worked. History now describes the book as a commercial and critical success on both sides of the Atlantic, and, importantly, readers widely accepted it as an authentic Gold Rush diary. Vizetelly eventually admitted in his 1893 autobiography that the whole thing had been an elaborate hoax.
This was not an isolated occurrence. There is an even more literal example involving Joseph Ware. In 1849, Ware published The Emigrants’ Guide to California, giving people detailed instructions for reaching California, including routes, supplies, water, distances, and even instructions for testing gold. Ware had never been to California when he wrote it. He compiled his advice from the accounts of people who had. He subsequently attempted the journey himself and died along the trail before reaching California.
This is the age-old business model of getting rich by teaching people how to get rich, circa 1849. An economic frenzy created by the widespread belief that a newly accessible resource could rapidly make you rich. AI has many of the same structural characteristics. The scarce resource has changed from gold to something closer to intelligence, automation, and productivity, but the economic behavior is recognizable.
Samuel Brannan reportedly didn’t merely sell supplies. He helped amplify news of the gold discovery while operating a business positioned to profit from the resulting demand. In modern language, he participated in creating attention around a market in which he was selling the enabling products.
This does not make this automatically bad or fraudulent like Vizetelly and Ware, but it suggests a useful question whenever you encounter an AI guru, consultant, course, or methodology:
Where did this person’s gold actually come from?
If they teach people how to build profitable AI businesses, look for profitable AI businesses they built other than the business of teaching people how to build profitable AI businesses. Ask this question before you head off to another California Gold Rush. To put it better, before you take advice from the miner, check whether he actually sells shovels.
