So, at the beginning of Harry Potter, Harry is found to have a large vault of gold at Gringotts. Where did all of that money come from? What did James (I assume it came from him, as Lily was muggle-born, and they were both young) do to get all of that cash?
Answer
James (and, by extension, Harry) got rich the old-fashioned way: he had rich ancestors.
In a new short story posted on Pottermore, titled "The Potter Family"1, Rowling reveals that the Potter family made their fortune with the invention of several important potions.
The seeds of the Potter fortune were laid by the first member of the family, Linfred of Stinchcombe, who invented medicinal potions:
Linfred was a vague and absent-minded fellow whose Muggle neighbours often called upon his medicinal services. None of them realised that Linfred’s wonderful cures for pox and ague were magical; they all thought him a harmless and lovable old chap, pottering about in his garden with all his funny plants. His reputation as a well-meaning eccentric served Linfred well, for behind closed doors he was able to continue the series of experiments that laid the foundation of the Potter family’s fortune. Historians credit Linfred as the originator of a number of remedies that evolved into potions still used to this day, including Skele-gro and Pepperup Potion. His sales of such cures to fellow witches and wizards enabled him to leave a significant pile of gold to each of his seven children upon his death.
Linfred laid a foundation that future generations would build on, though the specifics of each generation aren't recorded in this story:
The Potters continued to marry their neighbours, occasionally Muggles, and to live in the West of England, for several generations, each one adding to the family coffers by their hard work and, it must be said, by the quiet brand of ingenuity that had characterised their forebear, Linfred.
The family fortune was then greatly expanded by Harry's grandfather Fleamont Potter, who invented Sleekeazy's Hair Potion:
It was Fleamont who took the family gold and quadrupled it, by creating magical Sleekeazy’s Hair Potion ( 'two drops tames even the most bothersome barnet' ). He sold the company at a vast profit when he retired, but no amount of riches could compensate him or his wife Euphemia for their childlessness.
1 Pottermore account not required
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