|On August 7, 1938, prisoners from Dachau concentration camp were sent to the town of Mauthausen near Linz, Austria, to begin the construction of a new camp. The location was chosen due to its proximity to the transport hub of Linz, but also because the area was sparsely populated. Although the camp was, from the beginning of its existence, controlled by the German state, it was founded by a private company as an economic enterprise. The owner of the Wiener-Graben quarry (the Marbacher-Bruch, and Bettelberg quarries), which was located in and around Mauthausen, was a DEST Company: an acronym for Deutsche Erd- und Steinwerke GmbH. The company, led by Oswald Pohl, who was also a high-ranking official of the SS, rented the quarries from the City of Vienna and started the construction of the Mauthausen camp. While DEST rented the quarries at Mauthausen from the city of Vienna in 1938, the company bought it´s first lots of land at nearby Gusen already on 25 May 1938. A year later, the company ordered the construction of the first camp at Gusen. The granite mined in the quarries had previously been used to pave the streets of Vienna, but the Nazi authorities envisioned a complete reconstruction of major German towns in accordance with the plans of Albert Speer and other architects of Nazi architecture, for which large quantities of granite were needed.|
The money needed for the construction of the Mauthausen camp was gathered from a variety of sources, including commercial loans from Dresdner Bank and Prague-based Escompte Bank, the so-called Reinhardt's fund (meaning money stolen from the inmates of the concentration camps themselves); and from the German Red Cross.
Mauthausen initially served as a strictly-run prison camp for common criminals, prostitutes and other categories of "Incorrigible Law Offenders". On May 8, 1939 it was converted to a labour camp which was mainly used for the incarceration of political prisoners.