Feature: The Unbelievable True Story of IWC

The founding of an illustrious watchmaker is most often regarded with high esteem and much celebration, being the singular moment that turned decades and even centuries into a journey of discovery and innovation, but for IWC that moment is not quite so clear cut. This is the true story of how IWC came to be.

In the mid-1800s, the watchmaking scene was very different to how we know it now. England, France and America were at the forefront of the industry, America particularly so with respect to quality and especially volume production, thanks to the need to maintain pinpoint timing across the nation’s railroad networks. This drove a concerted effort into what was to become known as the “American System”, whereby manual and automated processes were combined under one roof to maximise efficiency and output.

The Swiss, meanwhile—well, that was a very different story. There weren’t any companies making watches so much as there were companies assembling parts made at home by farmers. Through the long, harsh Swiss winters, making watch parts brought in a steady, albeit low income for those farmers, although the work was not necessarily of a high quality. These were not watchmakers; they quite simply fashioned what they could to survive the colder months, their work collected periodically by someone doing the rounds.

Together, those parts could be built into a watch, but you can imagine the quality control issues in having wheels made by one person in one house, springs made by another elsewhere and so on—the watches that resulted were unreliable and imprecise. As the decades went by, the pool of people capable of turning their hand to watchmaking grew, and the government saw this as an opportunity for Switzerland’s prosperity—an opportunity a certain American by the name of Florentine Ariosto Jones sought to make the most of.

The Cantons of Switzerland made the world an offer: bring business and industry to the Swiss people, and the reward would be great. Not only was the labour more affordable than in America, but tax incentives and cheap, easy-to-get loans made the proposition too hard to ignore. Jones, employed deep in the heart of American watchmaking in Boston, having himself worked intimately with the American System, saw this as a chance to realise a dream: to build his own watchmaking firm.

IWC was founded in 1868

He had already established himself with a number of leading American watch and clockmakers, rising through the ranks as he showed himself to be more than capable of developing movements and processes that made for extremely accurate watches that could be reproduced in significant volumes. But to do it for himself under his own brand, with his own designs … it was something he had never thought possible, until the opportunity in Switzerland presented itself.

He had a plan: to build a factory in the Canton of Schaffhausen, on the banks of the River Rhine, where he could congregate his expertise in machine production with the growing skills of the watchmakers of Switzerland. He would bring employment to the community, to women especially, and prosperity to the town. His plan was bold: to produce as many as 10,000 movements per year, amounting to 7% of the entire Swiss export. Jones’ optimism and enthusiasm won the support he needed, and he was granted the investment to realise his dream. He moved to Switzerland to start the first step in his new journey: to build the International Watch Company.

Jones’ enthusiasm was not matched by everyone in the town. The media was speculating about his capabilities, having already been stung before by foreign businessmen taking advantage of the generous offers proposed by the government. Many believed that Jones’ plan would fail, that he would simply spend the money and disappear. Jones was determined to prove them wrong.

But before he could do that, he would first need to build his headquarters. He knew in his mind and through his experience what he needed, down to the smallest detail. He had planned not just the blueprints for his watch but the processes and equipment needed to make it as well. He would leave nothing to chance. High-specification machinery of Jones’ own design lined the walls, workshops for the dozens of employees who would come to bring the factory to life filled the vast halls—all it needed now was people.

IWC is based in Schaffhausen, Switzerland

Jones took the same attitude to his staff as he did the building they would work in. He wanted not just skill, but dedication, and his selection process was rigorous and lengthy. Not as rigorous and lengthy, however, as the training successful candidates would have to undertake. Everything had been so meticulously planned for every aspect of Jones’ calibre, every step for every part laid out in detail, and it would only work if he had the full understanding of every single person working for him.

It sounds like an extremely optimistic approach; a new continent, a new culture, a new process, a new facility and new people operating all of it. There was so much that could go wrong that Jones’ critics reasoned beyond doubt that something would—but against all odds, Jones achieved his dream. The design of his calibre and the process to fabricate it were flawless. The Swiss watchmakers and machinists performed expertly with his training. Jones’ had successfully established the American System in Switzerland for the very first time. The year 1868 was almost the fairy tale founding for IWC, the dream of Jones and of every watch company … almost.

Unfortunately, there was a problem, or rather, several problems. The factory had cost some two-and-a-half times more than Jones had anticipated in his pursuit for perfection. Training his staff took longer than planned to make sure they were beyond ready to meet his lofty targets. And although his plan did work, and the factory was able to construct enough high-quality movements to meet his promises, the biggest problem was yet to come.

Jones had been so preoccupied with making his calibre and making it well, a business he had excelled in through the course of his various employment in America, that he had not given any consideration to what he would do with them all when they were complete. And such high quality were they that they cost of each one was enormous, and so selling them proved to be incredibly difficult.

The current IWC headquarters in Schaffhausen was first constructed in 1875

As you can imagine, shifting some 10,000 top spec movements a year is a task too great for even the finest engineering mind, and perhaps that’s where the error lay; Jones was not a businessman, he was an engineer, a mechanical problem-solver, and although he had technically fulfilled his dream, the reality of it had fallen short. His investors demanded to see the return they had been promised, but Jones was unable to oblige, even rumoured to have deliberately halted production to try and fudge the numbers—and so the company filed for bankruptcy in 1876. Jones, having generated a loss of over a million Swiss Francs, was ousted not just from his position, but Schaffhausen itself. He was no longer safe there.

Defeated and deflated, his critics goading and jeering, Jones returned to America, his dream in tatters. He had been optimistic, naïve even, and although he had achieved his goal of establishing a new kind of watchmaking in Switzerland, he would not get to see that dream through to the end. The watchmakers he employed wrote an open letter of support for Jones to the people of Schaffhausen—but it fell on deaf ears. So heartbroken was he that, despite his demand back in America, he never worked in watchmaking again.

Jones’ story is nothing short of devastating, but you may be left wondering what happened next to IWC, as of course it still exists to this day. The investors, determined not to lose every last penny of their investment, restructured the organisation, instating former Waltham CEO Frederick Seeland in Jones’ place. Seeland had been chosen for his engineering prowess and was very similar in many respects to Jones himself … so perhaps it comes as no surprise to learn that the company, under his lead, went bankrupt again. Determined not to fail, however, one of IWC’s stakeholders, Johannes Raschenbach-Vogel, purchased the company, finally injecting a bit of business sense into the mix. His recipe was one of success, finally giving IWC the balance it needed to stay afloat—but never losing to this day that insatiable dedication to engineering perfection that Jones had instilled from the beginning. Jones may not have been the world’s best businessman, but as an engineer and a watchmaker? He changed the course of Swiss watchmaking forever.

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