Speaker 1: This is Alec Baldwin and you're listening to Here's the thing,
Speaker 1: My chance to talk with artists, policymakers and performers, to
Speaker 1: hear their stories. What inspires their creations, what decisions change
Speaker 1: their careers, what relationships influenced their work? How did you
Speaker 1: take your coffee this morning? And where did you take
Speaker 1: it from? If you're like tens of millions of your neighbors,
Speaker 1: you visited a Starbucks in the last week. The thirty
Speaker 1: year old coffee chain has become every bit as much
Speaker 1: an American icon as McDonald's and every bit as ubiquitous.
Speaker 1: Howard Schultz is the company's long time CEO, Operating out
Speaker 1: of the company's Seattle headquarters. He's overseen a worldwide expansion.
Speaker 1: In the process, he's become one of the most successful
Speaker 1: business men in the world. But before he became a
Speaker 1: coffee magnate, Howard Schultz was a Brooklyn boy who was
Speaker 1: anything but no money. My dad was had a series
Speaker 1: of just awful blue collar jobs and uh, no money.
Speaker 1: I have so how many siblings, brother and sister, younger,
Speaker 1: but it's very tough. So what do you do? Where'd
Speaker 1: you go? I went to school in Northern Michigan and Marquette,
Speaker 1: Michigan you probably have never heard of. That was in
Speaker 1: the Upper Peninsula, Michigan. And one day to play football.
Speaker 1: I had a problem, and that I was. I thought
Speaker 1: I was really good until I got to Michigan and
Speaker 1: I had a guy in front of me who turned
Speaker 1: out to be Steve Mariucci. Great guy, and he was
Speaker 1: a great college player. And I was not good enough
Speaker 1: to to make a long story shure, so I didn't.
Speaker 1: I did not play football. I got hurt when I
Speaker 1: was eight, team broke my jaw had a concussion, and uh,
Speaker 1: but I stayed and finished school there. When I finished school,
Speaker 1: I went to work for xerox Um in Manhattan, came
Speaker 1: back to New York, moved back into my parents house
Speaker 1: and apartment in Brooklyn, took the subway. My job at
Speaker 1: zero was to make fifty cold calls a day. I
Speaker 1: did that for three years. Uh. I loathed it, but
Speaker 1: it was great training and you knew you had to
Speaker 1: do it. I knew I had to do that, and
Speaker 1: I you know, I was making I was making a
Speaker 1: thousand dollars a month, and I gave half it to
Speaker 1: my mom. Living at home, I had one suit, two shirts.
Speaker 1: It was, but I was you know, I was twenty
Speaker 1: two years old. I didn't know any better, and I
Speaker 1: was happy. I mean suit and two shirts? How many
Speaker 1: suits and shirts do you have? Now? I'm just kidding,
Speaker 1: never mind, don't answer them. Now when you you gave
Speaker 1: half the money to your mom and you were living,
Speaker 1: they were in Brooklyn still, then you're taking the train
Speaker 1: to work every day. And then what changed? I knew
Speaker 1: I had to get out. I just I had this
Speaker 1: entrepreneurial dream and vision for myself. I remember telling my
Speaker 1: mom I was leaving zero. She started crying, and I
Speaker 1: was very fortunate. I got a job with a Swedish
Speaker 1: company that was opening up a US division as the
Speaker 1: general manager and kind of sold myself, yawn, my capability
Speaker 1: and worked for them for a few years. And that
Speaker 1: was the beginning of kind of realizing the potential capability
Speaker 1: I had to to to do something on my own.
Speaker 1: And that company you went to was where based in
Speaker 1: Sweden with the New York office, And what did they do?
Speaker 1: They sold very high end house wars and one of
Speaker 1: the products was a non electric coffee maker, which is
Speaker 1: a drip coffee was not electric. It was just it
Speaker 1: was a poor over hot water. And they sold a
Speaker 1: product to a small company in Seattle, Washington that had
Speaker 1: three stores, and that company was Starbucks, and the only
Speaker 1: roasted beans didn't surf coffee. You've done your homework. And
Speaker 1: I went out to Seattle on a day where it
Speaker 1: was majestic. It was like it was like Wizard of
Speaker 1: Odds type sunny, the snowcapped mountains, fresh air. I was
Speaker 1: dating my girlfriend who's now my wife, and I called
Speaker 1: her and said, this is where we have to live.
Speaker 1: And I spent the next year and a half trying
Speaker 1: to convince the founder of Starbucks, who had three stores,
Speaker 1: to hire me, and he ultimately did. We moved out
Speaker 1: to Seattle in September of eighty two. We had three
Speaker 1: stores that year. Uh. He sent you want this whole story? Uh?
Speaker 1: They sent me to Italy. I went to Milan for
Speaker 1: the first time to a trade show, and as you know,
Speaker 1: in Milan, in Italy, there's coffee bars everywhere. And as
Speaker 1: I was walking the streets in Milan, I kept bumping
Speaker 1: into another coffee bar, kept going in, and I could
Speaker 1: see the sense of community and a sense of place,
Speaker 1: and that the beverage was so romantic and brought people together.
Speaker 1: And I raced back from Italy and sat down with
Speaker 1: the founder of the company and said, I just think
Speaker 1: we're in the wrong part of the business. We should
Speaker 1: we should integrate the business into the beverage, and they
Speaker 1: didn't want to do it. Long story shortness, I left Starbucks.
Speaker 1: I opened my own Italian coffee bar with no money
Speaker 1: in Seattle. Three too in Seattle, one in Vancouver, BC.
Speaker 1: Then Starbucks Coffee Company acquired another company in California called
Speaker 1: Pete's Coffee, and Pets and Starbucks came together, and a
Speaker 1: year later Starbus got into financial trouble. The founder of
Speaker 1: star Wars came to me when they had six stores
Speaker 1: and said, I'm going to keep Pets and sell Starbucks.
Speaker 1: But I had no money. Uh to where you get
Speaker 1: the money to Starbucks. I knocked on everyone's door I knew,
Speaker 1: and finally I raised. I bought Starbucks in August of
Speaker 1: eighty seven for three point eight million dollars, and all
Speaker 1: three point eight million was money that was not mine.
Speaker 1: I had to raise it and um. At the end
Speaker 1: of eighty seven, we had eleven stores, a hundred employees,
Speaker 1: losing money. And then I had to raise money to
Speaker 1: try and build a national company. And I had this
Speaker 1: crazy idea and the idea he was in the back
Speaker 1: of my mind. I kept dreaming about what I needed
Speaker 1: to do for my dad. And my dad died in
Speaker 1: seven and I wanted to try and build the kind
Speaker 1: of company he never got a chance to work for.
Speaker 1: So the entire business model was trying to balance profit
Speaker 1: with conscience, benevolence, and social impact. So the first thing
Speaker 1: I did was, Uh, everyone in Starbucks was gonna be
Speaker 1: an owner. So I gave ownership to every employee in
Speaker 1: eighties seven, which I've done since then. And I gave
Speaker 1: comprehensive health insurance, first company in America to provide confidence
Speaker 1: and health way before the Affordable Care for every single
Speaker 1: person that works for you. Yes, yeah, what does that
Speaker 1: cost you a year? Uh? Before the Affordable Care Act?
Speaker 1: It costs three hundred million a year, more than the
Speaker 1: cost of coffee beans for Starbucks. People thought it was crazy,
Speaker 1: and I was trying to raise money at the same time.
Speaker 1: I had all these ideas and people said, wait, you
Speaker 1: want to get yeah, and I said no. I said,
Speaker 1: I'm going to prove to you that we will have
Speaker 1: lower attrition, higher performance, and our customers will know what
Speaker 1: we're doing for our people and it will resonate with
Speaker 1: the brand. And this is gonna be our marketing strategy.
Speaker 1: Do you continue to do that now? You still do that? Now?
Speaker 1: Not only do we do that now? But as an example,
Speaker 1: this year along with first company in America to give
Speaker 1: free college tuition to every employee, what does that call?
Speaker 1: Can't keep? Yeah, it's a lot, it's a lot. But
Speaker 1: all these things ladder up to balancing the company's mission,
Speaker 1: our core purpose and reason for being. We're not in
Speaker 1: business just to make money. We have to make money.
Speaker 1: We have to build your over value. And we've done
Speaker 1: extremely well. I mean, the market capital of Starbucks is
Speaker 1: is quite large. How many countries to two thousand stores? Now,
Speaker 1: what's an example of a place? I mean you when
Speaker 1: you when you leave, uh, you have the two in
Speaker 1: Seattle and the one in Vancouver. Those are Starbucks. Those
Speaker 1: came coffee bars, correct, those three? When you get beyond
Speaker 1: When you get beyond Seattle in that area, where do
Speaker 1: you go next? Where's the next place you where's the
Speaker 1: next beach out that you break into? Well, the last
Speaker 1: few years, I think the most successful place. We've been
Speaker 1: in China, but we've been there a long time. In
Speaker 1: the US, where did you go first? Well, where do
Speaker 1: we go from? Well, we went from Seattle to Portland's Chicago.
Speaker 1: We struggled in Chicago. It was just took a long
Speaker 1: time for Chicago people to understand what we're trying to do,
Speaker 1: and a lot of people lost faith in what we're
Speaker 1: trying to do. But finally it hit. I went to
Speaker 1: l A l A was a huge success overnight, and
Speaker 1: then we came to New York and uh, my mother
Speaker 1: came to that opening on eight seventh and Broadway. When
Speaker 1: you look at what Starbucks is now, did you have
Speaker 1: a dream that was going to be people having a
Speaker 1: coconut Martian backflip, frappuccino, every possible iteration. I'm told there's
Speaker 1: eighty five thousand gyrations to customization and Starbucks. I never
Speaker 1: imagined that customers would start telling people exactly what they wanted.
Speaker 1: But I think one of the drivers of our success
Speaker 1: has been our ability to customize what you want when
Speaker 1: you want it. But no, I know, I mean our
Speaker 1: original business plan when I was raising the original money
Speaker 1: was a hundred stores and I was having a terrible time,
Speaker 1: and I didn't have enough money to reprint the business plan,
Speaker 1: so I crossed out a hundred and wrote seventy five.
Speaker 1: I mean that's how tight things were. UM, But no,
Speaker 1: I never imagined we would have this kind of impact
Speaker 1: or to grow the company this large. What's something that
Speaker 1: you want to do that you're not sure you can do.
Speaker 1: What's something you'd like Starbucks to today? What's what's the
Speaker 1: thing you've dreamed about for a while that you'd like
Speaker 1: to do that you're not quite sure you can do
Speaker 1: it well? In Seattle a year and a half ago,
Speaker 1: um I had this ten year idea to build the
Speaker 1: Willy Wonka of coffee, so an attritional traditional Starbucks stores
Speaker 1: less than two thousand feet, and we started to design
Speaker 1: and building almost a twenty thousand square foot Disney like
Speaker 1: experience in Seattle and people and it's a great expense,
Speaker 1: I mean, very very expend big bet where we're roasting
Speaker 1: in the store, we're doing all kinds of things. But
Speaker 1: it's more than a store. And people thought this is
Speaker 1: the beginning of the end. This guy has lost it.
Speaker 1: That store has turned out to be a mecca for
Speaker 1: tourists and everyone who comes close to the city of Seattle.
Speaker 1: We're now under construction New York on the corner of
Speaker 1: ninth and fifteen for the same operation. Well, that one
Speaker 1: will be square feet two levels, next to the Chelsea
Speaker 1: Market and across from Google. And we're under construction in
Speaker 1: Shanghai with one that will even be bigger. Uh. I
Speaker 1: don't know if these things will have the same level
Speaker 1: of impact. I believe it will um but we have
Speaker 1: to keep reinventing and keep dreaming, and and you can't
Speaker 1: embrace the status quo of running a business today. It's
Speaker 1: just too hard and there's too many challenges. What's a
Speaker 1: country that you were going to go to? I remember
Speaker 1: I was with my friend in nineteen in the early nineties,
Speaker 1: and I went to Paris to visit him, and we
Speaker 1: spent many days together. We went to a restaurant and
Speaker 1: I ordered something and asked for some simple modification on
Speaker 1: the food of the menu, and the men literally mean
Speaker 1: like like a like a Saturday Night Live sketch. The
Speaker 1: man said, we are not Eddie McDonald's now, sir, I
Speaker 1: mean just barked at me. Two snapped at me, and
Speaker 1: I thought, what's the foreign country that gave you the
Speaker 1: most grief in terms of the ethic of Starbucks and
Speaker 1: where they're at about coffee. We are open in Paris
Speaker 1: and friends have done fairly well there, but we have
Speaker 1: never entered Italy as a result of the respect that
Speaker 1: I've had for the heritage of coffee. However, we are
Speaker 1: going Italy for the first time at the end of
Speaker 1: calendar seventeen. You are where in Milan at a location
Speaker 1: that is just gonna stunned people. So we'll see that's
Speaker 1: I mean, this will be the big You're not building
Speaker 1: the big twenty thousands. We have a Hershey Chocolate factory
Speaker 1: of coffee over there. Are you something close? Okay? All right,
Speaker 1: well you're gonna go. You're gonna get their attention. You're
Speaker 1: gonna get their attention. But respectfully, were you prepared for
Speaker 1: how much people have made coffee in general a part
Speaker 1: of their lives. Because when I was a kid, people
Speaker 1: had a cup of coffee. I mean my mother had
Speaker 1: Chase and Sandborn, you know all the names from that.
Speaker 1: You know Martinson's, Um, you'd go Horn and Herbert's. Uh,
Speaker 1: these places like the Automatic like in New York, mean,
Speaker 1: people had a cup of coffee. Some people drank coffee.
Speaker 1: People who drank a lot of coffee were viewed as
Speaker 1: kind of pushing the envelope, you know what I mean.
Speaker 1: And now it seems like people have told themselves they
Speaker 1: can't drink enough coffee. I mean, they don't feel that
Speaker 1: there's any harmful effects. Do you guys study that? Do
Speaker 1: you have any eye toward Not that I'm bequeating you
Speaker 1: with the tobacco industry, but two things. One, I think
Speaker 1: the success that we have enjoyed and the way in
Speaker 1: which people have embraced coffee as a beverage and indulgent
Speaker 1: beverage and a ritual in the morning. So much of
Speaker 1: all of that is linked to Starbucks becoming this third
Speaker 1: place between home and work and the sense of community
Speaker 1: where the rise of technology has created such secular behavior
Speaker 1: and people are longing for human connection even if they're
Speaker 1: in there alone. And so the Starbucks. Really, when you
Speaker 1: said alcohol, what triggered in me is we replace the
Speaker 1: pub in a way because uh, that that's not where
Speaker 1: people want to go. Uh. But we have studied a
Speaker 1: lot of the issues of caffeine and the the interesting
Speaker 1: thing is the most medical journals, in most recently the
Speaker 1: New England Journal Medicine coffee is quite healthy and medicinal
Speaker 1: specially doing pretty good. I'll tell you, uh, but I
Speaker 1: don't drink any caffeine after four PM. I just have enough.
Speaker 1: But I drink about four or five cups a day.
Speaker 1: How do you like your coffee? This is the question
Speaker 1: every he wants to know. Espresso marciato in the morning,
Speaker 1: first thing. Then I have a French press of age Sumatra.
Speaker 1: That's what I drink throughout the day, Age Sumatra. Ye,
Speaker 1: he's black black. What about you? I drink um in
Speaker 1: the summertime. When I go to Starbucks, I like Starbucks
Speaker 1: espresso or I like their cold brew. In the summertime,
Speaker 1: I take the cobraw. What's good? Because I do want
Speaker 1: someone to ring my bell if I drink that coffee
Speaker 1: and I don't feel that special feeling like someone kicks
Speaker 1: me right in the seat of the pants and I'm ready.
Speaker 1: We used to joke, I mean, this is gonna sound
Speaker 1: like a really vulgar analogy, but we used to have
Speaker 1: a drink we call the Nazi, And we called it
Speaker 1: a Nazi because it came into your bedroom and pulled
Speaker 1: you out of bed in the early more and the
Speaker 1: more early morning hours, threw you against the walls, slapped
Speaker 1: you across the phase five times to wake you up.
Speaker 1: It was four shots of espresso over ice. That's asome
Speaker 1: soy milk. That's always started my day for years, you know.
Speaker 1: I mean. The other thing is like I always remember
Speaker 1: when they when they had the book Fatal Vision, the
Speaker 1: Jeffrey McDonald murder case, and I was going to play
Speaker 1: him in a movie. And in the book they say
Speaker 1: that part of his defense would he suffered from caffeine psychosis.
Speaker 1: He said McDonald said he drank too much coffee and
Speaker 1: then made him go off the deep end. And I thought, well,
Speaker 1: I got com But you have the Sumatran black. You
Speaker 1: have an age coffee? Ever have you tasted? No? Are
Speaker 1: you a black coffee guy? Sometimes I'd like espresso. I'm
Speaker 1: gonna send you something that you'll find extraordinary. Now, Um,
Speaker 1: so you stayed out of Italy. Where has it been
Speaker 1: a big success overseas? Where have they just taken to it? Well,
Speaker 1: we talked about China. We have twenty five hundred stores
Speaker 1: in a hundred cities in China. The wonderful thing story
Speaker 1: about China is the person who runs China is a
Speaker 1: woman who's very strong. We have a completely Chinese team
Speaker 1: who was based in Shanghai, who has managed and built
Speaker 1: that company, supported by a lot of sources from Seattle
Speaker 1: in Hong Kong. We're in a lot of countries, but
Speaker 1: we own most of the China business are so um.
Speaker 1: One thing that people don't understand is we don't franchise
Speaker 1: our stores. You own them. We own all of them, yes,
Speaker 1: every single one of them, every single one except for
Speaker 1: stores that are either in airports or in other stories.
Speaker 1: But this goes back to the culture of the company.
Speaker 1: So much of what we've succeeded in is based on
Speaker 1: the values and culture of the company. And I never
Speaker 1: believed we could do that in a franchise system where
Speaker 1: the people weren't working for the company. So we have
Speaker 1: three thirty thousand employees who work for Starbucks. I want
Speaker 1: you to know that when my wife and I are
Speaker 1: driving too Long Island, we stop at the Starbucks on
Speaker 1: Mannorable Road and next at seventy there by the bank.
Speaker 1: Next to the bank, My wife and I go there
Speaker 1: all the time we are And I'm telling you, I
Speaker 1: hope I'm allowing me to tell you your business, but
Speaker 1: send those ladies a bouquet of flowers from you. That
Speaker 1: is the greatest Starbucks. And glad to hear that. Those ladies,
Speaker 1: they got to rows of people. It's like the Alamo
Speaker 1: people coming there wanting their coffee. Then they want to
Speaker 1: jump in that car. They want to get going through
Speaker 1: the traffic. So they just need the coffee just to
Speaker 1: make the rest of the last leg of the trip.
Speaker 1: And they got one more hour to go to get
Speaker 1: to the get to the East End. And those ladies
Speaker 1: are all the sweetest people and the loveliest people in
Speaker 1: my wifeend. We go on the way out and on
Speaker 1: the way that game, we always stopped there and get something.
Speaker 1: And I'm glad to hear that. I will do something
Speaker 1: for those people. Thank you. They're fantastic. Now, when you
Speaker 1: don't own the store, does it go just as well?
Speaker 1: Les It should be agnostic. It should, yeah, things, it
Speaker 1: should be the same. The airports are a little tough
Speaker 1: because so many people online and people in a rush.
Speaker 1: You know, sometimes we customers aren't patient. Yeah, what's a
Speaker 1: company that you see? Because I'm sure that especially when
Speaker 1: this thing just takes off and becomes this legendary iconic thing,
Speaker 1: what's a what's a company you see that you admire
Speaker 1: in the even a competitor for the But but another
Speaker 1: food service company or someth you look at and go, man,
Speaker 1: I really I love what those people live. I think
Speaker 1: what Danny Meyer has done in New York is quite something. Uh.
Speaker 1: And I think what he's trying to do with shake
Speaker 1: Shack is interesting. Uh. Not. A lot of food companies
Speaker 1: have scaled very well. Yes, it's it's it tends. Ubiquities
Speaker 1: is a is a challenge and it's hard to get
Speaker 1: big and stay small. So on the food side, um, it's.
Speaker 1: My mind immediately goes to other consumer brands like Nike,
Speaker 1: like Apple, like Disney. Not a lot of food and
Speaker 1: national food brands. But some of those food companies are
Speaker 1: serving your coffee corrective deals with them. Yeah, we have
Speaker 1: a we have a real significant partnership with Disney. In fact,
Speaker 1: we just opened a phenomenal store at the entrance of
Speaker 1: Shanghai Disney with Bob Iger and I did that together.
Speaker 1: What about food companies? Were no fast food companies? You
Speaker 1: don't have any deals to serve a Starbucks coffee? Uh No,
Speaker 1: we don't really. We have a lot of high end
Speaker 1: restaurants to serve our coffee. But no, I'll never forget.
Speaker 1: There was a guy who had a little place in
Speaker 1: Los Angeles. This guy Dick, his last name will come
Speaker 1: to me for a moment. I knew him for years
Speaker 1: and he owned a place called the Coffee Roaster and
Speaker 1: you go in there, and he told me an interesting
Speaker 1: story where he was selling beans. And he goes one
Speaker 1: day and he goes to a restaurant that he knows
Speaker 1: who is serving his coffee, and he says to them, um,
Speaker 1: could I have a cup of coffee? And they bring
Speaker 1: him the coffee that says his beans, and it was terrible.
Speaker 1: It was fancy because they've been sitting in the burner
Speaker 1: for too long. And he said, that's when I got
Speaker 1: out of that business because they did not couldn't control
Speaker 1: the qualtepec that. Oh god, but I just thought of
Speaker 1: a food company. I do respect which is in and out?
Speaker 1: Why uh it maintained the quality? Those bathrooms are really
Speaker 1: clean and maintain a quality. Take care of the people.
Speaker 1: I'm sure you don't in and out. Now your wife
Speaker 1: has been with you on a person not your wife
Speaker 1: is with you the whole ride. What is your wife
Speaker 1: think about question of my wife. Okay, I have a
Speaker 1: great story for you. Okay, okay. So you remember I'm
Speaker 1: raising money for Starbucks in the early days, Sherry. My
Speaker 1: wife is pregnant with our first child in I'm working
Speaker 1: at Starbucks. We we have we we have ill journalie.
Speaker 1: I don't have Starbucks yet. I have no salary, and
Speaker 1: we're not making any money. She's eight months pregnant, she's
Speaker 1: still working. We're in a rental house in Seattle. Her
Speaker 1: parents from Lime, Ohio come out to see us. I
Speaker 1: love her parents, good people. And her father says, uh,
Speaker 1: let's let's take a walk. So I had a sense
Speaker 1: that this is this is not gonna be uh uh,
Speaker 1: not gonna be good. And we sit down and he said,
Speaker 1: I I respect everything you've tried to do over the
Speaker 1: last year, but let's look at the facts. My daughter's
Speaker 1: eight months pregnant, she's working, she has a salary, you
Speaker 1: have a hobby, no income, and she's gonna give birth
Speaker 1: in a month. It's time to get a job. And
Speaker 1: I just started to cry, embarrassed, humiliated. Uh And part
Speaker 1: of me knew what he was saying was right, but
Speaker 1: I couldn't give it up. So that night I didn't
Speaker 1: say anything until that night when we were alone. I said,
Speaker 1: I had a interesting talk with your father, and Sherry said,
Speaker 1: there's there's no way we're giving us up. And if
Speaker 1: that moment, if she would have said it's time, we
Speaker 1: wouldn't be here coming up. Howard Schultz explains why Starbucks
Speaker 1: almost disappeared in two thousand seven explore of the Here's
Speaker 1: the Thing Archives. Lorne Michaels runs his own kind of empire,
Speaker 1: and it's all on television for me, commercial television and
Speaker 1: those boundaries. I like it. I like that you can't
Speaker 1: use a certain language. I like that you have to
Speaker 1: be bright enough to figure out how to get your
Speaker 1: ideas across in that amount of time, with intelligence being
Speaker 1: the thing that you're you hope is showing. Take a
Speaker 1: listen at Here's the Thing dot org. This is Alec
Speaker 1: Baldwin and you're listening to Here's the Thing. Howard Schultz
Speaker 1: runs the world's largest retail coffee company, with more than
Speaker 1: twenty five thousand outlets across the globe. That's a lot
Speaker 1: of business to keep track of, but Schultz says he's
Speaker 1: able to fit more into his day than most people.
Speaker 1: For some reason, I don't sleep. You never required a
Speaker 1: lot of sleep, So why do you think that's because
Speaker 1: of caffeine. No, no, it's not caffeine. I've never inquired
Speaker 1: a lot of sleep. So I'm up at four am
Speaker 1: and you've got to sleep with time the pen. But
Speaker 1: I'm up. I'm just not. I got a bed of ten,
Speaker 1: but I'm up. I just don't. I don't see you sip.
Speaker 1: So for you, a good night is five hours. Yeah,
Speaker 1: that's that's that's that's gold. Yeah, that's gold. Yeah. Um,
Speaker 1: And you don't need a lot of I've been cycling
Speaker 1: for the last ten years. That's the only thing I've
Speaker 1: been able to do because I've had a couple of
Speaker 1: of fusion surgeries neck and back. I did they help you?
Speaker 1: The surgeries have not helped me. You know what was
Speaker 1: wrong with your back? What were the songs all related
Speaker 1: to that problem I have? When I was eighteen and
Speaker 1: had the jaw problem? How did that happen? Playing football?
Speaker 1: Somebody drilled you in the face without their helmet. I
Speaker 1: have a blindside sack in which it was a face plant.
Speaker 1: Oh my god, it wasn't easy. You know. I'm a
Speaker 1: Jewish kid from Brooklyn, So pain uh, total hypochondriac. Anything,
Speaker 1: I got a call, I feel like I'm getting anumonia.
Speaker 1: You know you can relate to that game. Yeah, if
Speaker 1: I if I, if I get a little headache and
Speaker 1: I think I'm a gersh. When I got a brain tumor,
Speaker 1: I've gone for a brain scan. I got Now you
Speaker 1: stay when the company is headquartered in Seattle, Yes, and
Speaker 1: you lived there. Yes, you have other homes, but you
Speaker 1: live in Seattle. Is important for you to stay in Seattle.
Speaker 1: We love Seattle. Our kids were born there, but both
Speaker 1: our kids live in New York ironically, so we're here
Speaker 1: a lot um. But Seattle is a great place and
Speaker 1: that's where home is. But when I when I when
Speaker 1: I fly into New York, I can already feel the
Speaker 1: sense of pride and belonging. So I'm very much home here.
Speaker 1: The the Starbucks just expanded and he's tamping a couple
Speaker 1: of months ago in the winter, right before this this
Speaker 1: past summer, and they are just I mean, I can't
Speaker 1: even imagine how much what the grossers are there. Just
Speaker 1: it's just constant, constant, and you check and see how
Speaker 1: stores are performing. Because what's described for us the evaluative
Speaker 1: process in which you decide we're going to close that store.
Speaker 1: We don't close many stores. But so at five am
Speaker 1: every morning of my life for the last hundred years,
Speaker 1: we get a report on the data of every single
Speaker 1: store in the world, basically, and we see what stores
Speaker 1: are doing versus last week, versus last year, versus budget.
Speaker 1: And you don't have the time to go stores. No,
Speaker 1: But I've been doing this a long time, so I
Speaker 1: can like you're reading a script, right, So when you
Speaker 1: see is it specific to areas? When the ones don't work?
Speaker 1: Why don't they work? Uh, we probably made a mistake
Speaker 1: with the location, which we've done from time to time,
Speaker 1: but not many times. We have a real science about demography.
Speaker 1: We know where to go, what's the area of the
Speaker 1: United States or what's even one store? What's the place
Speaker 1: that just blows your mind? What's what's the all time Champa?
Speaker 1: A couple of them of Starbucks store, Uh, phenomenal store
Speaker 1: in Chicago and Oaken Rush you know that, you know,
Speaker 1: you know Chicago. Um, most of our stores in Manhattan.
Speaker 1: I do pretty well. The store and asked her places
Speaker 1: like a high volumet store to store and so on
Speaker 1: the corner of Cross be in in Broadway and you
Speaker 1: know that store. Um, I've recently heard Donald Trump say
Speaker 1: that the store in Trump Tower is the busiest store
Speaker 1: in the world. I can promise you that is not
Speaker 1: the case. Now, Um, did you ever look at this
Speaker 1: and you think that your four bad moves away from
Speaker 1: the whole thing going away? Have you ever seen a
Speaker 1: company that really really, all of a sudden they just
Speaker 1: went poof? They were gone? Well, we we almost lost
Speaker 1: the company in oh seven. Uh, Eubrius and success drove
Speaker 1: a series of undisciplined mistakes. Now, I wasn't at I
Speaker 1: wasn't I left the CEO job during that period, but
Speaker 1: I was still. Um. I was bored at the time.
Speaker 1: I just felt like I had done so many different things,
Speaker 1: and I did a couple of things that I wanted
Speaker 1: to do that I should not have done. Once I left.
Speaker 1: What you do? I bought a basketball team, which one
Speaker 1: Seattle Superstonics. You bought the Seattle Supertonics, which you shouldn't
Speaker 1: have done. No, I should have done it. It just
Speaker 1: was culturally not for me. But I wanted on the Yankees.
Speaker 1: But that wasn't gonna happen to you a Yankee fan.
Speaker 1: I'm more of a Yankee fan, I mean the Mets.
Speaker 1: It is hard to root for the Mets. I mean
Speaker 1: we grew the harder to root for the Jets. I
Speaker 1: grew up with a Giant fan. I'm a Giant fan
Speaker 1: now and I respect the Mets. The Jets, I mean,
Speaker 1: they just never failed to bring it right. The Jets
Speaker 1: organizationally have time. You never think they don't want to
Speaker 1: spend the money. But how long did you own the
Speaker 1: sh I'm totally ignorant about this, how perspects for five
Speaker 1: years and um, and when it didn't turn out well
Speaker 1: and it didn't end well, um, I convinced myself that
Speaker 1: I could apply my talents and my insight and vision
Speaker 1: onto a professional basketball team and change the culture. And
Speaker 1: I was not able to do it. And you wanted
Speaker 1: to change it from what to what. I wanted to
Speaker 1: create an environment in which people played for each other.
Speaker 1: And I think I was very naive. They don't I
Speaker 1: think this. I think the the Golden State Warriors have
Speaker 1: proven that they do. I think the San Antonio Spurs do.
Speaker 1: It looks like Belichick in New England Patriots do. It's
Speaker 1: the top down thing. Yeah, I think. I'm very good
Speaker 1: friends with Tony the russa baseball manager who had such
Speaker 1: great success in St. Louis, and I think he taught that.
Speaker 1: But as an owner on as an outsider, I don't
Speaker 1: think I was able to build a kind of trust
Speaker 1: and confidence that could imprint that. I think if you
Speaker 1: started from scratch, I could do it. By the time
Speaker 1: that you did it, did someone whisper to you don't
Speaker 1: do this? We warned my wife, She told you don't
Speaker 1: do it. Why why did she feel she hated it
Speaker 1: from the beginning? Just the nature of sports writers, um
Speaker 1: sports fans, the the immediate need to win, and and
Speaker 1: how difficult it is in a small market to do that.
Speaker 1: When you stepped away as CEO, how long did that last? Uh?
Speaker 1: Four or five years? During came back to I never
Speaker 1: planned to come back, but I had to come back
Speaker 1: as for love and responsibility, trying to save the company.
Speaker 1: We were almost we almost lost it. And how did
Speaker 1: that happen? Describe how you would lose the company? Well,
Speaker 1: we lost about thirty billion dollars in market cap in
Speaker 1: about a year. The reason was bad locations, uh, measuring
Speaker 1: and rewarding the wrong things and fracturing the culture of
Speaker 1: the company. You see. I mean, I don't know anything
Speaker 1: about business, but you would see in New York, for example,
Speaker 1: that CVS and Dwayne Read open stores across the street
Speaker 1: from each other, like within a block. They have one
Speaker 1: on every block in a battle to put each other
Speaker 1: out of business and undercut their prices. And there was
Speaker 1: a time on the Upper West Side there seemed like
Speaker 1: there was a Starbucks on every block. Too many problems,
Speaker 1: too many They just seem that way with thought of
Speaker 1: this must be a move for them to just kill
Speaker 1: all the competition. But if you break business down, it's
Speaker 1: pretty simple. It really is. You have to have a
Speaker 1: really a vision and a real core purpose and reason
Speaker 1: for being. You have to recognize its success is best
Speaker 1: when it's shared, and you've got to create a culture
Speaker 1: in a set of values where people feel like they're
Speaker 1: part of something larger than themselves. You treat people with
Speaker 1: great respect. You exceed the expectations of your people so
Speaker 1: they can exceed the expectations of the customer. That's it.
Speaker 1: Who was whose idea was it for you to come
Speaker 1: back mine? You can do? I knew it, and they
Speaker 1: welcomed you. Please. The media and the Wall Street analysts
Speaker 1: wrote seething stories said how could you possibly bring him back?
Speaker 1: He was the problem from the beginning. I have all
Speaker 1: those headlines. I put him in a drawing the It
Speaker 1: was brutal, and even some people in the company said, no,
Speaker 1: not not him. And then there was some people on
Speaker 1: the board who thought, we need a professional manager, we
Speaker 1: need a real professional and U with the task in
Speaker 1: the beginning closing love of stores. We closed a thousand
Speaker 1: stores within six months of me returning all that had
Speaker 1: opened in less than a year. That's how bad just
Speaker 1: makes fires. Yeah, we just and I had to make
Speaker 1: some very tough decisions. But here we are. Man, when
Speaker 1: what period of time does the thirty billion dollar loss
Speaker 1: of market cap that reverses itself over? What period of
Speaker 1: time you're there for? How long when you come back?
Speaker 1: If I came back in January eight, so I've been
Speaker 1: back eight years almost nine, I guess we lost that
Speaker 1: market cap from O seven to oh nine. Eight O
Speaker 1: nine came back and started coming back in in two
Speaker 1: thousand eleven, and then today, um, as good as it's
Speaker 1: ever been. But success at this level is very fragile,
Speaker 1: and I worry all the time. Well, I mean, I
Speaker 1: remember when I was a kid, you would see chains
Speaker 1: of food companies that are gone. You know, they might
Speaker 1: not have been big monoliths like like a McDonald, but
Speaker 1: there was heart Ease, and there was Wetson's, and there
Speaker 1: was other companies and they're there's gone. Remember the Walkman BlackBerry?
Speaker 1: Do you have a fear of that all the time?
Speaker 1: You do? And that's why I think we're you know,
Speaker 1: part of the reason why I think we're successful was
Speaker 1: Andy Grove, who was the head of Intel. Intel once said,
Speaker 1: only the paranoids of what's what's something that you want
Speaker 1: to do that you're not sure you can do. What's
Speaker 1: something you'd like Starbucks to today? Right, What's what's the
Speaker 1: thing you've dreamed about for a while that you'd like
Speaker 1: to do that you're not quite sure you can do it.
Speaker 1: But traditional Starbucks stores less than two thousand feet and
Speaker 1: we started designing and building almost a twenty thousand square
Speaker 1: foot Disney like experience in Seattle and people and it's
Speaker 1: a great expense, I mean, very very expend big bet
Speaker 1: where we're roasting in the store, we're doing all kinds
Speaker 1: of things. But it's more than a store. And people
Speaker 1: thought this is the beginning of the end. This guy
Speaker 1: has lost it. That store has turned out to be
Speaker 1: a mecca for tourists and everyone who comes close to
Speaker 1: the city of Seattle. We're now under construction New York
Speaker 1: on the corner of ninth and fifteen for the same operation. Well,
Speaker 1: that one will be square feet two levels, next to
Speaker 1: the Chelsea Market and across from Google. And we're under
Speaker 1: construction in Shanghai with one that will even be bigger. Uh.
Speaker 1: I don't know if these things will have the same
Speaker 1: level of impact. I believe it will um but we
Speaker 1: have to keep reinventing and keep dreaming. Well, I want
Speaker 1: to just I want to do what I can because
Speaker 1: I'm a Starbucks fan, to make my contribution to ensure
Speaker 1: the success of Starbucks. And as I said to you
Speaker 1: before off Mike when we were outside, you gotta bring
Speaker 1: back prison Cake. When I was in New Orleans, it
Speaker 1: was you gotta find that this one cake. We called
Speaker 1: it prison cake because it was kind of an oatmeal loaf.
Speaker 1: It had no glaze on it, no drizzle on it
Speaker 1: was very low sugar. You didn't feel guilty in my
Speaker 1: pre diabetic nightmare, I wanted my coffee and I wanted
Speaker 1: my prison cake. And then and then we've got I'm
Speaker 1: asking you, that's why we brought you here, like we're
Speaker 1: gonna find you. Guys had prison cake. It was like
Speaker 1: an oatmeal loaf and it's gone or oat loaf for
Speaker 1: something and it was gone. And I thought, how could
Speaker 1: you do that to me? I can't eat stuff. Okay,
Speaker 1: that's a long time ago out a long time ago.
Speaker 1: But you were there. This is on your watch, Howard Schultz,
Speaker 1: you killed prison Cake. I expect you brought your team,
Speaker 1: your cracked team with you here. I hope they're on
Speaker 1: the prison cake hunt as searching as we find or
Speaker 1: maybe not. I never heard back from Starbucks about the
Speaker 1: origin of prison Cake that said they have been busy
Speaker 1: with the launch of their new video and podcast series
Speaker 1: called Upstanders. What basically we've done is we went out
Speaker 1: and we found these people, and we created podcasts like
Speaker 1: we're doing here. We created word essays on each one
Speaker 1: of them, five minute video stories that are now embedded
Speaker 1: in Starbucks mobile app. And basically we're doing everything we
Speaker 1: can to shine a light on the fact that citizens
Speaker 1: across the country are really the real story. Over the
Speaker 1: last few years, I've been super critical of the fracturing
Speaker 1: of leadership and the lack of um responsibility by elected
Speaker 1: officials in Washington. How dysfunctional and polarized it's been. But
Speaker 1: having said that, every day people wake up all over
Speaker 1: America and every city doing great things. And I want
Speaker 1: to tell those stories. And I'm gonna use Starbucks and
Speaker 1: our scale and our platform to share the upstandards. And
Speaker 1: that's what we're doing. We've got a great response, how
Speaker 1: great the people in this country really are? Yes, have
Speaker 1: you ever thought of running? I have thought about that,
Speaker 1: but not not now. Not now. It means maybe so
Speaker 1: all the time. Maybe maybe that'd be a great idea.
Speaker 1: Howard Schultz, CEO of Starbucks. You can view and listen
Speaker 1: to the Upstanders series on the Starbucks mobile app. This
Speaker 1: is Alec Baldwin and you were listening to Here's the
Speaker 1: thing