Biography - Page 2
Within the burgeoning mutant population, Sebastian Shaw saw not only a remarkable step in human evolution, but also an opportunity to make an immense profit. Mutants could do things ordinary people could not, and some of these skills could prove quite valuable in the marketplace. In order to maximize the profit he could reap from the mutant abilities of others, however, Shaw wanted not merely to employ mutants, but to maintain complete, monopolistic control over the X-gene they possessed. If people needed to solicit Shaw Industries in order to benefit from mutant abilities, it would make Shaw one of the most powerful men in the world. This was, after all, Shaw’s original intention for Project: Armageddon.
However, Shaw also saw mutants as a source of political power, and longed to add the most formidable among them to the ranks of the Lords Cardinal. As the Black—and only reigning—King of the New York Chapter of the Hellfire Club's Inner Circle, it fell on Shaw to recruit powerful new allies to vacant positions. Early on during his reign, he extended an invitation to Namor the Sub-Mariner, the king of Atlantis, to serve as his White counterpart. While most people would have considered such an offer an honor, Namor greeted it with utter contempt, deeming such a role beneath him. Shaw dealt with this egregious insult by sending Emma Frost to change Namor's mind. Emma, however, disappeared with Namor for two weeks without a word. Believing Emma was dead—or worse, had made a cuckold of him—Shaw deployed Donald Pierce's underwater Sentinels to trace Emma to Atlantis, where the killing machines wrought havoc on the city. After destroying them, Namor, who had indeed taken Emma as a lover, traced them back to their origin. He and Emma arrived in Pierce's Sentinel factory and confronted the culprits. Emma was shocked to learn that it was Shaw who had sent the Sentinels, as she had naively believed part of the reason he was working so hard to cultivate an Inner Circle was to defend mutantkind against precisely this kind of danger. Shaw surprised her by revealing that, since the federal government was inevitably going to build these machines anyway, he might as well benefit. Namor vowed revenge and left, while Tessa wiped Emma's memory of the whole affair. [Uncanny X-Men Annual (2nd series) #2]
Having cleaned up the mess with Namor, Shaw focused his attention back to the business of making money by exploiting the mutant genome in the marketplace. The mutant X-Men represented both an obstacle and an opportunity for Shaw. Being superheroes, they would surely oppose his schemes, just as they had opposed and derailed Project: Armageddon earlier. [X-Men (1st series) #96-100] However, they also possessed amazing abilities he wanted to harness, reproduce, and sell. Additionally, they controlled Professor Xavier's device Cerebro, which detected mutant signatures throughout the world. Without control of Cerebro, Shaw had no way to compete with the X-Men in identifying and ensnaring new mutants. Before making any additional moves against the X-Men, he and the Hellfire Club decided to co-opt Cerebro to their advantage. They dispatched an agent into the X-Mansion to plant a bug on Cerebro that would automatically update them on any activity it detected. Their agent, Warhawk, succeeded without the X-Men catching wind of his true motives. [X-Men (1st series) #110]
With Cerebro now under their control, the Hellfire Club decided to eliminate the X-Men before continuing with their plan to harness the X-gene. They tasked their telepathic illusionist Jason Wyngarde, aka Mastermind, with subverting the X-Men's most powerful member, Phoenix, to their side. Mastermind spent months stalking Phoenix, subtly winning her over to the Hellfire Club. Mastermind would mentally trick her into thinking she was in Revolutionary War-era America, where she became enamored with Wyngarde's dashing, colonial counterpart. [X-Men (1st series) #125-129]
Incidentally, during this slow process of subversion, Cerebro detected the emergence of two new mutants. The Hellfire Club tried to procure these new mutants before the X-Men could. Knowing they might fail, they prepared a backup plan of ambushing the X-Men unawares and capturing them. When the X-Men split up to recruit these two new mutants, the Hellfire Club ambushed them at their respective sites. The White Queen succeeded in capturing half of the X-Men, but the rest of them—with the help of their newly discovered mutant friends—rescued those in captivity and thwarted the Inner Circle. Additionally, the White Queen was defeated and nearly killed by Phoenix in the process, temporarily removing one of Shaw's most powerful allies from play. Although the mission was a bust, Mastermind had continued subverting Phoenix's will throughout the failed ambush—and his efforts were beginning to bear fruit. [X-Men (1st series) #129-131]
The X-Men soon retaliated against the Hellfire Club. Although Shaw and the Club were not quite prepared for their attack, they had little trouble thwarting them. Wyngarde's temptation of Phoenix paid off at a most pivotal moment, as he was able to completely switch her to the Hellfire Club's side during the ambush. Now bearing the mantle of the Black Queen, Phoenix turned on her teammates and helped deliver a swift victory to her new cohorts. Shaw pulled his weight during the fight, single-handedly besting both Colossus and Storm in battle.
Unfortunately for Shaw, Harry Leland failed to neutralize his target, Wolverine. As a result of Leland's failure, Wolverine returned and ambushed the Hellfire Club once they relaxed their defenses, nearly killing Leland in the process. The rest of the X-Men broke free and defeated the Club members one by one. Shaw fled through the sewers with Donald Pierce, vowing to get back at the X-Men another day. Phoenix, meanwhile, broke free of Mastermind's grip and fried his mind in retaliation.
The Inner Circle's tampering with the Phoenix had another unintended consequence as well—this one far more serious. Tempting Phoenix's dark side accidentally unleashed the Dark Phoenix, a cosmic force of nearly limitless power. After escaping from the Hellfire Club, the Dark Phoenix fled across the galaxy and devoured a star similar to Earth's sun, killing the five billion members of the civilized alien species that inhabited one of the planets in its orbit. It is unclear if Shaw was made aware of this act of xenocide at the time, or if he even would have cared had he known. Regardless, as it was an indirect consequence of his manipulating the free will of another mutant as well as other forces he didn't understand, it should not be overlooked. [X-Men (1st series) #132-135]
With Emma comatose, Harry hospitalized and Wyngarde's mind fried by the Phoenix, Shaw's Inner Circle was devastated. His ambitions, however, remained intact. Like any successful businessman, Shaw always protected himself against risk by diversifying his investments. 
When his plot to control the X-Men failed to result in the coveted mutant monopoly, he decided to double-down on a more profitable arm of that same project: the Sentinels. Immediately after the Inner Circle's meddling with the X-Men resulted in their retaliation, Shaw spoke to the authorities and blamed the attack entirely on the X-Men—and, more broadly, the mutant menace they represented. One of Shaw's guests that evening, his longtime friend and presidential candidate Senator Robert Kelly, was horrified at what the mutants had supposedly done to the Hellfire Club. Shaw did not have to try very hard to convince Senator Kelly that mutants were a dangerous menace and that further action was necessary to prevent future attacks. He suggested to the Senator that they reactivate the long-dormant Sentinel program. Unbeknownst to Kelly, of course, Shaw had already been developing Sentinels. [X-Men (1st series) #135]