The Plymouth Colony and London Colony were formed under King James I. as business enterprises.  The parties to the patents were capitalists, who had the right to settle colonists and servants, impose duties and coin money, and who were to pay a share of the profits in the enterprise to the Crown.

The London company, under the name of Jamestown, established the beginning of the first English town in America, May 13, 1607, with one hundred colonists.  Captain John Smith was the genius of the colony, and it enjoyed a certain prosperity while he remained with it.  A curious incident of its history was the importation of a large number of young women of good character, who were sold for one hundred and twenty, or even one hundred and fifteen, pounds of tobacco (at thirteen shillings a pound) to the lonely settlers.  The Company failed, with all its expenditures, some half-million dollars, in 1624, and at that time, numbered only two thousand souls—­the relics of nine thousand, who had been sent out from England.

Though the Plymouth Company had obtained exclusive grants and privileges, they never achieved any actual colony.  A band of independents, numbering one hundred and two, whose extreme principles led to their exile, first from England and then from Holland, landed at a place called New Plymouth, in 1620.  Half died within a year.  Nevertheless, the Pilgrims, as they were called, extended their settlement.  The distinction of the Pilgrims at Plymouth is that they relied upon themselves, and developed their own resources.  Salem was begun in 1625, and for three years was called Naumkeag.  In 1628, John Endicott came from England with one hundred settlers, as Governor for the Massachusetts Colony, extending from the Charles to the Merrimac river.  A royal charter was procured for the Governor and Company of Massachusetts Bay in New England, and one thousand colonists, led by John Winthrop, settled Boston, 1630.  These colonists were Puritans, who wished to escape political and religious persecution.  They brought over their own charter and developed a form of popular government.  The freemen of the town elected the governor and board of assistants, but suffrage was restricted to members of the church.  Representative government was granted in other colonies, but in the royal colonies of Virginia and New York, the executive officers and members of the upper branch of the legislature were appointed by the Crown.  In Maryland, appointments were made in the same way by the Proprietor.  Maryland was founded 1632, by royal grant to Cecilius Calvert, Lord Baltimore.

The English colonies were divided in the middle by the Dutch at New Amsterdam and the Swedes on the Delaware.  The claim of the prior discovery of Manhattan was raised by the English, who took New Amsterdam, in 1664.  Charles II. presented a charter to his brother, James, Duke of York.  East and west Jersey were formed out of part of the grant.

The patent for the great territory included in the present state of Pennsylvania was granted to William Penn in 1681.  Penn laid the foundations for a liberal constitution.  Patents for the territory of Carolina were given in 1663.  Carolina reached the Spanish possessions in the South.