The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
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Schultz: An Il Giornale investor tried to hijack the 1987 Starbucks acquisition
“Jerry gave me about, I think he gave me 90 days to raise 3.8 million dollars. Around the second month, he just came to me and said, where are you with all this? And I think I had about half of it raised. I might have fibbed a bit and said I had a little bit mo…”
Schultz: Starbucks introduced the caffè latte to America without trademarking it
“The other thing I didn't do is we introduced cafe latte to the, to America. We didn't trademark it. You know, we trademarked Frappuccino later on, but we didn't trademark cafe latte.”
Schultz: Starbucks was seven months from insolvency in 2008
“I went up there, and I laid it out. Chapter and verse. I think we have seven months left. We are going to be insolvent.”
Schultz: Previous Starbucks leadership diluted coffee quality to maximize yield
“Because the previous administration had done things that diluted the integrity of coffee to maximize yield.”
Schultz: Starbucks Replaced Entire Executive Team Except General Counsel
“He was right, except for one, the general counsel. They were all gone.”
Schultz: Straight espresso is Starbucks' number one selling beverage in Italy
“Two, three years later, what do you think the number one beverage is? It's espresso. For Starbucks. Straight espresso. Espresso is the number one beverage.”
Schultz: Faema and Lavazza both rejected investing in Il Giornale
“One is the espresso company, Faima. And one is the large Italian coffee company Lavazza. And I asked them both to invest in my idea. And both of them turned me down.”
Schultz: Selling in Costco Directly Increased Starbucks Retail Store Sales
“In fact, putting Starbucks in Costco, we were able to measure directly
The increase in volume in the stores on the east side as a result of the proximity to the Costco store.”
Schultz: Coca-Cola dismissed Starbucks ready-to-drink pitch in under 30 minutes
“The Coke meeting was a meeting lasted less than 30 minutes. I can't remember who I met with. They dismissed me didn't view Starbucks or, didn't understand what I was trying to do and didn't give me much time to even explain it.”
Schultz: Starbucks suspended buybacks to invest over $2B into partners
“The day I came back, and I knew what the market would do, is I announced that we were suspending the stock buybacks, and stock went down. I expected it, and I announced that we were going to take basically the money we were using to stock buybacks for the year…”
Schultz: Starbucks originally resold Peet's Coffee in Starbucks bags in 1971
“Now what is not known is that when Starbucks opened in the Pike Place Market in 1971, they were using Pete's Coffee. No one knows that. That's new. Because they were not roasting coffee. So they were bringing coffee from San Francisco to Seattle. They were not…”
Schultz: World War II GI rations drove post-war low-quality coffee adoption
“World War II and the GIs were kind of the impetus for that kind of quality coffee, or not quality coffee, to exist and have any kind of run after the war.”
Schultz: Starbucks ran into financial trouble after acquiring Peet's Coffee
“Now between 83 and 85, Jerry Baldwin, because of his love of Pete's and his relation with Alfred Pete, had an opportunity for Starbucks to acquire Pete's Coffee Company. And they did. Unfortunately, Starbucks buys Pete's, and they get into financial trouble.”
Schultz: Bill Gates did not know his father saved the Starbucks acquisition
“Bill did not know the whole story. He didn't know any of it. He didn't know what his father had done for me. He's hearing it for the first time.”
Schultz: Starbucks beverage retail achieved roughly 80% gross margins early on
“The ability to source and roast coffee And put that through the supply chain of a beverage gave us probably at the time an 80% gross margin.”
Schultz: Starbucks store model targeted 2:1 sales-to-investment and 20% operating profit
“The model basically was a sales to investment ratio of two to one. And a operating profit of 20%.”
Schultz: Starbucks spent zero dollars on marketing in its early days
“We didn't spend any money on marketing. Zero. It was no money for market in the cup. The iconic cup became a badge of honor because people were doing something that was new and novel and walking in the street with it”
Schultz: Starbucks Granted 14% of Base Pay in Stock Options Pre-IPO
“Ultimately we gave 14% of everyone's base pay in the form of stock options at the end of the year based on the strike price. And I had to do it the year before the IPO.”
Schultz: Costco Co-Founder Jeff Brotman Invested in Starbucks' 1987 Buyout
“First, Jeff Brotman invested in Starbucks in the round to buy Starbucks.”
Schultz: Goldman Sachs rejected leading Starbucks' 1992 IPO for being too small
“We got turned down by Goldman Sachs.”
Schultz: Starbucks and Pepsi launched bottled Frappuccino via 50/50 JV
“Subsequently, Craig Weatherup and I, on a napkin, I swear, shook hands and created a multi-billion dollar business For Pepsi and Starbucks and a fifty-fifty JV and bottle Frappuccino.”
Schultz: Consulted daily with Michael Dell before returning as Starbucks CEO
“On that holiday, a friend of mine
Not, I didn't know he was there, but it was Michael Dell was there. And I must've talked to him almost every day about the transformation of Starbucks. And he was going through a similar thing at Dell almost at the same time. …”
Schultz: 10-11 daily customers per store could reverse negative comps
“And then I had this economic formula of how many customers it would take per store to turn comps around. And the number was low. It's like less than 10 per day or 11 per day.”
Schultz: Starbucks secured China approval to insure employees' parents and grandparents
“Belinda decided that she could go to the government and go to an insurance company and come back to Starbucks and get government approval for Starbucks to do the first, do something had never been done before and provide health insurance to the parents and gra…”
Schultz: Starbucks baristas consistently make 100,000 different beverage variations
“I think I, the number that people use inside the company is a 100,000 different variations of beverages that are being made consistently. A 100,000 different beverages.”
Schultz: McDonald's and fast-food coffee copycats expanded the total coffee market
“Well, not only that, but every food company, every retail food business from McDonald's on, took a page out of Starbucks, went to school on us, put espresso machines in their stores, and started doing coffee beverages. That also expanded the market.”
Schultz: Starbucks sold no prepared coffee beverages until around 1985-1986
“Starbucks coffee company from 1971 until around 8586, only sold pounds of coffee. There was no beverage.”
Schultz: Starbucks has only sourced the highest tier of Arabica coffee since 1971
“There's mainly two types of agricultural coffee grown for commercial use. Robusta beans, low-end coffee, primarily in instant coffee, and high-grade Arabica coffee. But even within the Arabica coffee, there's significant segments of quality and integrity, and …”
Schultz: Starbucks' first espresso pilot reached 500 daily customers within a week
“On the corner of Fourth and Spring in Seattle, and it was the sixth Starbucks store, and out of about 1200 square feet, I got a hundred feet, and I designed and opened the coffee bar, worked behind the counter as a barista, and Starbucks probably had two to 30…”
Schultz: Starbucks had 11 stores and 100 employees at end of 1987
“August of 87. We bought the six Starbucks stores. We had the three old Eldranales, and there were two stores under construction. So at the end of the calendar year, we had 11 stores And a hundred employees in 1987.”
Schultz: Gloria Jean's Once Had More Stores Than Starbucks via Franchising
“That was Gloria Jeans out of Chicago. And at one point, I think they had more stores than we did because of the franchising opportunity.”
Schultz: Starbucks never paid for product placement in movies
“First of all, Starbucks never paid for placement.”
Schultz: Starbucks struggled and lost money in China for nearly a decade
“We struggled in China for almost a decade. Lost money. There was tremendous pressure inside the company of close China.”
Schultz did 100 Starbucks earnings calls as CEO, mostly unscripted
“I did a hundred quarterly conference calls as CEO. A hundred.
That's a lot of earnings prep, because each one of those has, what, two weeks before it of.
The truth is, the majority of those were no script.”
Schultz: Starbucks never had a negative comp month before 2008
“Never had a negative comp month in my history of the company.”
Schultz: Starbucks JV Partners Run Operations While Starbucks Controls Roasting and Design
“Starbucks is responsible for roasting the coffee, for all the recipes which are consistent with Starbucks worldwide, A co design of the store where we're designing the store with the JV or the licensed partner, and they control all the operations.”