Captain Phillip found that Botany Bay was flat and windy. There was not much fresh water. He went with two ships up the coast and sailed into a great harbor which he said was "the finest harbor in the world!" There were many small bays on the harbor so he decided on one which had a good stream of fresh water and some flat shore to land on. On 26 January 1788, the flag was raised and New South Wales was claimed in the name of King George III of England, and the new settlement was called Sydney.