The Starbucks Story (3 page)

I have written this chapter over an afternoon. By choice, I decided to write neither at home nor at a place of work. I chose a third place. It was warm and welcoming on a wintry day, relaxing and conducive to writing. No one intruded on my space. I was free to think whatever I liked, to engage with people and my surroundings if I wished, or to shut everything else out if I needed to. The variety of people was a source of interest, yet a sense of communion emerged, a way of being in touch with myself and the world, with my own life and with the life around me.

It all started with a coffee bean, an arabica, not a robusta. From this, as if in Jack’s fairy tale, a giant beanstalk has grown that has opened up a different way of life. We should enjoy it, and also understand a little more about how it happened.

“Call me Ishmael.”

I’ve always loved the opening line of Herman Melville’s
Moby-Dick
. It seems I’m not alone in this. In 1971, three young men decided to set up a business selling high-quality coffee. They agreed on most things, but not on the name for the business.

One of the three wanted to call the business Pequod. Why? Well, he too liked
Moby-Dick
, and
Pequod
was the name of the ship that sought the great white whale across the world’s oceans. I’m sure it was the romance of the story that appealed to him.

But his two friends would not countenance the name. They thought the first syllable was particularly unfortunate for a shop selling a drink. They got another friend to do some local history research, and discovered that Starbo was a mining camp from the early days of the Seattle region.

One of them then made a connection back to
Moby-Dick
, remembering that the first mate on the
Pequod
had been called Starbuck. Did he like coffee? Perhaps he did. But the stories of the high seas and the seafaring tradition of the coffee trade seemed to confirm that Starbucks was a name that fitted their business.

The three friends were Jerry Baldwin, Zev Siegl and Gordon Bowker. They had met in the 1960s at the University of San Francisco. San Francisco in the 1960s conjures up images of hippies with flowers in their hair, and that certainly provides the context for the times. Along with the more obvious aspects of the hippie life, such as sex, drugs and psychedelic music, there was a resurgence of interest in alternative ways of life. This interest lasted with a significant number of Americans who turned away from the processed, manufactured and prepackaged approach to food. They went in search of food that had more flavor because it was fresher and more authentic. They made deliberate choices to reject the mediocre and artificial, and to seek out natural wholesome food. And coffee, too.

At the time, coffee came in the form of powder or granules, mostly in jars or cans labelled Nescafé or Maxwell House. Its relationship to real coffee was remote. This was true not just for the US, but for much of Europe, although when young Americans went traveling they came across a different type of coffee. Few took to Turkish coffee as they embarked on the hippie trail in Istanbul, but Amsterdam, Paris and Milan offered a completely different taste for coffee from the one you could get out of a jar off the supermarket shelf. There was a romance to it as well, because there were trails for coffee drinking that took in the great cities of Europe, and trails for coffee growing and trading that stretched out to mountain slopes and ports in Africa, Asia and South America.

Jerry Baldwin, Zev Siegl and Gordon Bowker did what many educated young men of their generation did in the 1960s. They went away traveling, mostly to Europe. When they came back they settled in the Seattle area, although there was a sense in which they felt unsettled by their traveling. They started working in whatever seemed most convenient at the time. Jerry and Zev became teachers; Gordon was a writer who was starting a creative business. They had become friends because they shared many interests: classical music (Zev’s father was concert master for the Seattle Symphony Orchestra), movies, literature, and fine food and drink. In particular, they shared a love of great tea and coffee and a yearning to find out more about it.

Starbucks started because its three founders cared desperately about good-quality coffee. They had little interest in creating a business empire. Indeed, as Starbucks grew bigger each of them bailed out at different moments, leaving the business to be developed by others. But their legacy was their original commitment to find and sell the kinds of tea and coffee that they enjoyed drinking. Love of the product was what drove them originally, and Starbucks today would argue that the same passion for coffee is still at the heart of the business.

The three founders had a missionary zeal to educate their friends and neighbors in the ways of good coffee drinking. So perhaps it is not surprising that Gordon Bowker’s description of his moment of revelation has a biblical feel to it. Gordon would regularly set off on expeditions to hunt down good coffee beans. He had discovered a store called Murchie’s in Vancouver, Canada, three hours’ drive from Seattle. On a bright sunny day in 1970, his car loaded with bags of coffee beans bought from Murchie’s, he saw the light. He later told a Seattle newspaper how he had been “blinded, literally, like Saul of Tarsus, by the sun reflecting off Lake Samish. Right then it hit me: open a coffee store in Seattle!”

Gordon was a writer, so there might be some poetic license in his story. The hard facts are that he, Jerry and Zev then invested $1,350 each in the idea and borrowed an extra $5,000 from the bank. They committed themselves to the idea that became Starbucks.

In many ways the timing was not great. The first Starbucks shop opened in Seattle in 1971, at the deepest point of a local recession caused by a downturn in fortunes at Boeing. Between 1969 and 1971, the Boeing workforce plummeted from 100,000 to 38,000 and, of course, many businesses that depended on Boeing went out of business, too. Famously, a billboard near the airport said, “Will the last person leaving Seattle turn out the lights?” Seattle might now seem a cool, thriving, sophisticated city. Back then, it was a backwater in which the water was draining away.

This did not deter Jerry, Zev and Gordon, although they were cautious in their commitment. None of them gave up their jobs in the early stages. When the first shop opened its doors, only Zev was employed full time. They viewed the enterprise more as a commercial hobby than as a way to make fast money. Above all, they were driven by a need to educate. Bad coffee and tea offended them.

They had a sense of tradition, too. Coffee had a history of nurturing debate and thought. They were aware of the way that coffee drinking had become such an intense fashion in the seventeenth and eighteenth centuries. The great cities of the era – Paris, Venice, Vienna, London – spawned coffee houses. People went there not just to take the exotic new drink, but to meet other artists, scientists and writers – and to talk. A visitor to Vienna wrote in the early 1700s: “The city of Vienna is filled with coffee houses where novelists or those who busy themselves with newspapers delight to meet.”

There were two other aspects of tradition that were important in Starbucks’ foundation. The first showed itself when Jerry, Zev and Gordon started looking for premises to begin trading. Pike Place Market has become internationally famous in recent years through the bestselling management book
Fish!
, based on observation of the fish traders who worked there. That book would never have been written, and the fish sellers would have dispersed to other places with less character, if the proposals for wholesale redevelopment of the area in the early 1970s had come to pass. No doubt as a response to the need to attempt regeneration of the city following the Boeing debacle, a group of developers came up with plans for a new commercial center to replace Pike Place Market. It was to include a hotel, convention center, parking lot and shops. The people of Seattle voted in a referendum to keep their market and to reject the redevelopment. Jerry, Zev and Gordon acquired a small shop in the market and made plans to open their first Starbucks.

The second aspect of tradition that mattered was the strong sense of connection to Europe. The European coffee house had naturally created its own tradition of coffee making, based on a method of roasting and brewing beans that was completely different from what had become the American way. Like most American cities, Seattle has a link back to Europe that derives from immigration. It has a strong Scandinavian element, and down the west coast are communities that still take pride in their origins in various European countries. Much of this migration took place in past centuries, but some of it has continued into recent times.

One man’s emigration from the Netherlands to the west coast of the US is particularly important in the development of Starbucks. Alfred Peet has been described as Starbucks’ spiritual grandfather, and there is no doubt that he provided inspirational and practical help to the company. He had arrived in the US in the mid 1950s, settling in the San Francisco area. His father, Henry, had been a coffee merchant and roaster, and was sadly disappointed by Alfred’s decision to follow in his footsteps. Alfred served an apprenticeship in Amsterdam with a coffee importer, then began working in his father’s business just before the Second World War. He had a hard time in the war, first making faux coffee from chicory and peas, then serving in a German forced labor camp. But his first and enduring love was coffee and the smell of coffee. It was this aroma that had lured him into the family business and that now, after the end of the war, drew him back despite his father’s bullying.

In 1948, Alfred Peet went traveling. He made for Java and Sumatra, and became an advocate for the virtues of arabica beans, fuller-bodied and fuller-flavored than robusta. As the Dutch East Indies gained independence, Alfred Peet carried on traveling, going to New Zealand and then eventually arriving in the US in 1955. He was not impressed by the coffee he encountered: “I couldn’t understand why in the richest country in the world they were drinking such poor-quality coffee.” He came to this conclusion not just by drinking coffee, but by working in the coffee business for some of the US’s biggest coffee roasting companies.

Everything came to a bitter end when Peet was laid off and found himself unable to find a new job. It was 1965; he was 45 years old and had inherited some money from his father. So he decided to go into the business of roasting and selling his own coffee. He was shrewd in his choice of shop location: the corner of Vine and Walnut Streets in Berkeley, California. For the local academics and students, real coffee, made the European way, had a special allure. Peet’s Coffee & Tea opened in 1966, and started selling roasted coffee beans for home consumption. The shop also had six stools for customers to sit and taste the coffee.

For many Americans this was a culture shock. Peet made no concessions to their taste. He roasted his coffee dark and he brewed it strong. Some faces were pulled in disgust, but enough expatriate Europeans sought out the shop to get the business off the ground. Peet was an evangelist for coffee, and he was persuasive in conveying his enthusiasm for the pleasure to be gained from good coffee – his coffee. Soon he hired two female assistants and taught them how to cup and enthuse and, before too long queues, were forming out the door. Peet’s was the place to go.

Customer service, though, was never Peet’s thing. He disliked many of his customers. This was the start of the hippie time and Peet thought many of his young customers paid too little attention to personal hygiene. “Some of those guys were smelly,” he said. But despite his hostility and his hectoring approach to coffee education, the business thrived. Indeed, it developed into something of a cult, and coffee worshippers would gather to inhale the aroma of the roast.

Among these customers were Jerry Baldwin and Gordon Bowker. Absorbing Peet’s passion for coffee, and dealing with him mainly by mail order, they started to educate themselves about the differences between various kinds of coffee. They absolutely endorsed his preference for arabica over the more generally available robusta beans, and accepted the need for dark roasts. It was like a high-school education in coffee for them. The only way to get a university-level education in coffee was to set up their own business and to start to learn some of the techniques and skills they knew Peet had. There he was, in California’s vine-growing area, making his own blends, rolling coffee round his mouth, blind tasting and identifying coffee from all around the world. Could they ever match that kind of expertise? Would there be enough of a market in Seattle for gourmet coffee?