The start of the California Gold Rush began with the discovery of gold in 1848. On January 24 of that year, James Marshall discovered gold at Sutter's Mill in Coloma, California while working for John Sutter, an entrepreneur who had headed out west to establish himself in the mercantile trade. The discovery was made entirely by accident. Mr. Marshall was cleaning up around the mill and discovered the gold in the tailrace of the mill.
James Marshall recognized the gold for what it was but being an honest man and loyal to his employer and business partner, he went to share the secret privately with Mr. Sutter, who asked him to keep the information of the find confidential for fear that it would bring prospectors to the area and destroy his dreams of building a business in the area.
The two men agreed that the gold should be kept secret but, as with all secrets, the story eventually got out and the California Gold Rush began. As John Sutter had predicted, his business enterprise was ruined by the gold rush as his workforce deserted him to seek their wealth in gold prospecting and his cattle and other goods were pillaged by the new settlers who came seeking their fortunes.