In December 1913, Harry Clay closed down almost his entire Sydney suburban circuit for some two and a half years, and focused his operations on the Bridge Theatre, Newtown. During that time, he largely presented vaudeville, with occasional forays into film exhibition and drama. By mid-1916, however, he began to realise that the Australian variety industry was undergoing considerable growth. While the steady rise in the population and increasing economic prosperity over the previous decade were key factors in helping the industry to expand its market leading up to that time, the First World War's impact on Australians at home also played a significant part. As the public became more aware that the conflict would be drawn out and attempted to come to terms with the disaster of Gallipoli and the Western Front, more and more people turned to variety theatre for both light relief and the social interaction that it offered. The popularity of Bert Le Blanc's Travesty Stars and Nat Phillips' Tabloid Musical Comedy Co (aka Stiffy and Mo), which both specialised in one-act musical comedies, led to a number of locally based entrepreneurs investing in the same type of entertainment in order to meet the demand.
Clay's first foray into producing the revusical genre occurred in late 1915, when he contracted Arthur Morley's Royal Musical Comedy Company to stage a number of original productions in Sydney. The success of this initial venture was such that he had not only re-opened his Sydney suburban operations by September 1916, but had also opened up a circuit in south-western New South Wales (which followed the rail line west to Bathurst and then south to Albury via Wagga Wagga). In order to meet the huge demand, Clay put together four musical comedy companies, which rotated around the entire circuit on a monthly basis, playing a week at the Bridge Theatre, a week around Sydney, and two weeks on the country circuit. The first of the companies to be formed was Morley's troupe, which was given the name Harry Clay's No 1 Revue Company, with the others given the numbers 2 through to 4. Although Clay maintained that this numbering system did not signify that the Morley-led troupe was superior to the others, it nevertheless boasted some of the more significant performers ever contracted to Clay. Of the original No 1 company, those who had also been members of Morley's Royal Musical Comedy Company included Elsie Bates (aka Mrs Arthur Morley), Will Rollow, Ted Stanley, and Amy Rochelle. Morley, Bates, Stanley, and Rollow then went on to form the nucleus of the No 1 company between 1916 and 1918. Other notable performers engaged for the company up until 1922 were Evelyn and Bert Dudley, the Phillips Sisters (Eileen and Bessie), Lulu Eugene, Eva and Vince Courtney, Ern Delavale and Will Gilbert, Ted Tutty, Maurice Chenoweth, Letty Craydon, and Wal Rockely.
While the No 1 Company remained in operation up until around 1922/1923, at which time Clay once again contracted his operations to Sydney (and notably his inner city venues, the Bridge, Princess, and Gaiety theatres), its key years were 1916 to early 1919 (prior to the industry downturn that occurred as a result of the Spanish influenza epidemic). During this period, the troupe was responsible for originating many locally written revusicals, including most of Morley's productions. After Morley left Harry Clay's firm in late 1917 to join the Fullers, the troupe was led by various performer/manager/writers, notably Art Slavin.
