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The Honolulu Advertiser
Posted on: Sunday, September 1, 2002

Coffee giant started out as tiny seller of beans

By Dina ElBoghdady
Washington Post

Growth is not what the founders of Starbucks had in mind when they opened a shop at Seattle's Pike Place Market in 1971.

Gerald Baldwin, Gordon Bowker and Ziev Siegl were coffee purists, content to sell whole Arabica coffee beans to a niche market of like-minded people.

When Howard Schultz was interviewed about joining their marketing team in 1982, the company had five stores. But Schultz, a New Yorker, spoke of growing beyond the Northwest and opening dozens, maybe hundreds, of shops.

As Schultz tells it in his book, "Pour Your Heart Into It," his vision and aggressive style spooked Baldwin and Bowker (Siegl had left in 1980). He had to beg for the job.

Soon after he got it, Schultz returned from a trip to Italy fascinated by Milan's espresso bars and Italians' casual but constant connection with them. He urged his bosses to start selling coffee by the cup.

Reluctantly, they relented. In 1984, Schultz set up an espresso bar in a small corner of their only downtown Seattle Starbucks store and drew rave reviews.

But the owners refused to move forward, convinced it would push them into the fast-food business and distract them from roasting coffee. Besides, Schultz said, the company was in debt, having just purchased Peet's Coffee and Tea of Berkeley, Calif.

Schultz ventured out on his own. With financial help from his former bosses, he opened Il Giornale in 1985, an espresso bar selling beverages made with Starbucks beans.

Il Giornale was a success, but Schultz's big break came two years later, when Starbucks decided to sell its six stores, its roasting plant and its name for $3.8 million.