Duke Friedrich III of Holstein-Gottorp persuaded them to invest capital and knowledge in this region in turn for freedom of their Mennonite and Remonstrant religions (see: Arminianism) and opportunities to reclaim fen and marsh land in the vicinity of the town.

Between 1633 and 1637 Frederick III sent an embassy to Tsar Michael I of Russia and to Shah Safi of Persia with a view to setting up Friedrichstadt as a European trade terminus.

The delegation was led by the jurisconsult Philip Crusius and the merchant Otto Bruggemann or Brugman; their secretary, the scholar Adam Olearius, later wrote a book documenting the mission.

The aim of creating a regular trading route that did not need to pass around Africa was not achieved, the delegation proved fruitless and the town did not become as successful as anticipated.

Beside the Remonstrants and Mennonites, other faith communities which settled in the town included Unitarians, Quakers, Catholics and Jews.