Crane’s paper trail spreads beyond U.S. currency market
The company with roots that go back to Colonial America is undergoing a revolution of its own, fighting to make its name in the multibillion-dollar market for manufacturing currency.
The Washington Post
The story of how a family-run company became the linchpin of currency in America — and increasingly the world — is steeped in the lore of the midnight ride of Paul Revere.
The legendary patriot stabled his horses at the Massachusetts paper mill run by Thomas Crane, a staunch supporter of independence from Britain.
So it was only fitting that Revere turned to him for a way to assure colonists taking up arms in the American Revolution that they would be paid.
Crane accepted the challenge and crafted bills of credit for the soldiers that bore the motto “Issued in defence of American Liberty” — giving birth to what is now a multibillion-dollar global industry.
For seven generations, the Crane family and its company have been the sole supplier of the special blend of linen-and-cotton paper that gives U.S. money its distinct feel.
Repeated attempts by competitors to dethrone Crane have failed. It has survived attacks by counterfeiters, coins and credit cards.
Now, this all-American company is undergoing a revolution of its own, fighting to make its name in the multibillion-dollar market for manufacturing currency.
It has 1,400 employees and has made its international headquarters in Sweden. It supplies paper to Mexico and Thailand, prints bank notes for Tanzania and sells high-tech 3D security features to South Korea and Lebanon — making it one of the fastest-growing players in the insular and intensely competitive business of making money by making money.
“In order to survive, we had to become global, and we had to become a technology leader,” said Lanse Crane, former chief executive and sixth-generation family member.
“That’s where there was opportunity, and that’s where at the end of the day we really staked our future.”
Crane enjoyed its golden era in the decades after World War II.
Though Thomas Crane made history by printing the first colonial currency in Massachusetts, the enterprise did not blossom until a century later when the United States moved to a single system of paper money and put out a call for suppliers.
Murray Crane, 26, traveled to Washington with a mission to win that business — and unknowingly laid the foundation for the company’s future.
“It had to be huge,” said Peter Hopkins, a consultant to Crane and its de facto historian. “It was a big, big deal.”
Crane never let go of its early lead in the currency business and vigorously defended its monopoly.
As the process grew increasingly specialized, it became harder for other companies to enter the market. U.S. money is now printed on a blend of 75 percent cotton and 25 percent linen that once relied on scraps from the denim industry.
The paper is crafted to ensure the surface stays smooth and the material is durable.
A normal sheet of paper can be folded about 400 times before it breaks; a dollar bill must withstand at least 8,000 folds.
International powerhouses such as De La Rue in England and Giesecke & Devrient in Germany became interested in the U.S. market in the 1980s.
Improved technology was enabling counterfeiters, and the foreign companies promised enhanced security features that threatened to outpace Crane’s capabilities.
Lawmakers questioned the company’s long-standing monopoly, leading to congressional hearings and federal investigations. A 1987 law sponsored by U.S. Rep. Silvio Conte protected Crane. Its headquarters lay within his Massachusetts district, and he counted the family among his close friends.
The legislation prevented companies with foreign ownership from supplying paper for U.S. currency and also limited any contracts to four years, making the bids less attractive to domestic competitors.
“We don’t take that relationship ever for granted,” said Stephen DeFalco, Crane’s current chief executive. “We’re every day trying to rewin that business.”