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When Alan Pinkerton started his business--originally called Pinkerton's National Detective Agency--in 1850, little did he know that his security and investigations company would plant the seed for what would blossom into an entire new industry. In fact, his company's logo, "the eye that never sleeps," eventually generated the common term used to describe private investigators: the private eye.
Pinkerton's business was the first national detective agency in the United States and, as fate would have it, its first client was the Illinois Central Railroad Company. The railroad's attorney, Abraham Lincoln, and Alan Pinkerton developed a relationship that proved mutually beneficial to the two men, especially when Pinkerton uncovered a plot to assassinate the president-elect on the way to his inauguration. As a result, Pinkerton was hired to help protect Lincoln, and his business became the forerunner to today's Secret Service. (Pinkerton had lost the contract by the time Lincoln attended a performance at Ford's Theater that infamous night in 1865.)
After the Civil War, Alan Pinkerton returned to private life and served clients in business and industry. The company's reputation flourished toward the end of the 19th century when his men pursued Wild West "bad guys" such as Frank and Jesse James and Butch Cassidy and the Sundance Kid.
In this century, the company turned to more prosaic private security jobs, including policing office sites and school campuses, but continued to grow and prosper. By the 1980s, the industry that Pinkerton created had spawned some 10,000 competitors, and Pinkerton Security remained one of the largest, boasting 135 offices in the United States, 20 in Canada and one in the United Kingdom. That's when Tom Wathen, now chairman and CEO, stepped into the picture.
"Why would a 57-year-old man go off and put himself in so much debt [by buying Pinkerton Securities & Investigation Services]? The answer: stupidity and ego," Wathen says with a grin. "It was also just so logical."
Wathen initially began to pursue Pinkerton in 1985 when he approached American Brands Co., which had bought the security company two years earlier. "They were competing in the market at prices that were [so low they were] unbelievable," he recalls. "I knew they were not making money."
His offer was rebuffed. No thanks, he...