21 Lessons From The Man That Built Starbucks

Toni Koraza

https://img.particlenews.com/image.php?url=1T1KuJ_0XiHO5Ez00

Howard Schultz is an American Billionaire with a special story.

He is famous for overcoming the odds and changing the lives of millions around the world. Howard Schultz is an author, and Chairman emeritus of Starbucks. And if you don’t know what that title brings, I don’t blame you.

Chairman emeritus means that you left a company in good standing and that they can call you back at any time to help weather the crisis.

Schultz is an author of 4 business books and an ex-owner of Seattle SuperSonics. He’s early childhood is tainted by housing projects and unstable finance. But today, Schultz is officially worth $4 billion, reaching the status that 99.9% of people in history have never had. Howard Schultz is a shining example of the American Dream.

1. You Always Have a Fighting Chance

Howard Schultz is proof that you stand a fighting chance in life. Neither of his parents has ever finished high school. Schultz grows up in the Canarsie public housing projects in Brooklyn.

“I feel so strongly that the reason I’m here is I dreamed big dreams. I dreamed the kind of dreams that other people said would not be possible.” Howard Schultz

Through hard work and determination, the boy makes it in life. He’s the first in Shultz family to ever attend college.

2. Every family is complicated

Fred Schultz is Howard’s father, and also one of the fundamental drives in his life. Schultz works hard to shake the image of his father being a failure.

“The most indelible image I have of my dad is of him lying on our couch in a cast, distraught.”

Fred falls on a patch of ice during the delivery of diapers. He breaks his hip and ankle. As a result, Fred loses his job without any compensation.

“The image of my father on the couch, helpless, stuck with me.”

The Schultz family is not insured in any way. His mother is 7 months pregnant at the time and she’s in no condition to the wok. The family hits a rough financial patch, and young Howard escapes the 7th-floor apartment to hide between the staircases and dream about a better life.

3. Intrinsic Motivation is a Powerful Drive

You don’t have to do everything for yourself. Howard Schultz is deeply motivated by the memory of his father. He never sets out to build an international business, he just wants to create a company where his father can work and have a normal life.

“Care more than others think wise.”

As a result, Schultz creates a health coverage system for every Starbucks employee that works at least 20h/week. Starbucks is the first company in the US to give Healthcare to all its employees.

Schultz is often quoted saying that he wants to create a company for his father. Starbucks is a place where Fred stands a chance of bringing food on the table, even after the injury.

4. Failure is not the End of the Road

Your first avenue to success in life might not work out, and that is all right. Howard sees a great opportunity in football.

“My other escape was sports. The playgrounds of the projects became a second home, and as a teenager I spent most of my free time playing basketball and football on its concrete courts.” Tk

Schultz becomes a solid football player in high school. He starts preparing for college football, as a way to get the scholarship. Schultz is refused the tuition money upon enrolling at Northern Michigan University.

Through blood donations, student loans, and a series of questionable jobs, he pays for college.

5. The first in the family

Schultz graduates with a Bachelor’s degree in Communications. He’s the first in his family to finish higher education.

“In 1975, I became the first in my family to graduate college. Unfortunately, my parents could not afford to attend the graduation ceremony, but I knew my mother was proud.”

Sometimes, you don’t need to be around the dearest people to know they support you. Schultz preserves through trouble and hardship and makes his family proud.

6. Take care of your own

American sales jobs are brutal, but Schultz loves talking to people. His first job is door-to-door sales where he makes more than 50 cold calls each day.

“I always gave half of my paycheck to my parents.”

The money starts pouring in, but Schultz never forgets where he comes from. He’s putting his parent's needs beyond the personal satisfaction of a hip life.

7. The Grand Vision

You need the vision to make it big. Vision is like goals, but bigger. Vision is your ability to imagine and foresee your future.

“I believe life is a series of near misses. A lot of what we ascribe to luck is not luck at all. It’s seizing the day and accepting responsibility for your future. It’s seeing what other people don’t see and pursuing that vision.”

Schultz walks inside the Starbucks Coffee, Tea, and Spice company in Seattle and lays eyes on the metal coffee maker that grinds real beans. The bean grinder is not popular across the US in the 80s, and he’s immediately piqued.

Schultz sees how coffee is roasted to the deep brown color and ground to perfect smooth texture. The taste is robust and earthy. At that moment, Schultz sees Starbucks on every corner around the world.

8. Persistence pays off in the long run

Schultz asks to meet the owners of the obscure coffee place. Starbucks is just a Seattle coffee retailer at the time, but the business is booming. The story is strangely similar to the first McDonalds and Ray Kroc.

The founding owners are happy to see Schultz, but not impressed with his ideas. Jerry Baldwin is the business guy. And Gordon Bowker is an arty teacher. Zev Siegl, the third founder, is already one foot out of the door by the time Schultz walks inside the shop.

Jerry Baldwin and Gordon Bowker tell Howard Schultz that they have no position for him at Starbucks. But Howard Schultz doesn’t give up. He’s following through on his vision. Schultz continues to call with various prepositions about making Starbucks an international sensation.

“Jerry, you are making a terrible mistake,” Schultz says over the phone, then lays out a defense of his proposal. Baldwin goes back to his partners with Schultz’s plea. “So we caucused about it some more and … the veto was withdrawn, and we hired him”— Gordon Bowker.

Howard Schultz becomes the director of retail operations and marketing at Starbucks Coffe, Tea, and Spice.

9. Fight Against the Status Quo

Only a year later, Schultz experiences his first Italian espresso in Milan. He’s blown away by the aroma and the culture. Coffee is not that popular at the time in America.

“Any business today that embraces the status quo as an operating principle is going to be on a death march.”

He returns back to Seattle and brings a new proposal to Bowker and Baldwin. The Starbucks Founders turn down the expansion amid fears of the American culture just not being into coffee that much.

10. Scalability is the Mother of International Business

Scaling is what entrepreneur thinks about before going to bed, and every morning upon waking up. How can you scale your business?

Scalability explores how fast can you expand your business. Do you have the right system, right product, and the right conditions to take your business globally?

“Most business people today are not going to invest in the uncertainty that exists in America.”

Howard Schultz quits Starbucks to start his own company Il Giornale, named after the Milanese newspaper. He knows the risk of introducing espresso to the international market, but Schultz doubles down on his dream.

11. Go against the grain

You can hardly change the world by not taking risks. You can hardly bring espresso to America and China if you don’t step on any toes. Nobody likes this part of the job, but it’s a harsh reality.

“Starbucks stores only sold whole bean coffee and had no seating. I had a vision of creating specialty coffee stores that integrated the romance of espresso and provided a place for community. The founders of Starbucks, however, weren’t interested in my idea.”

Schultz visits over 500 coffee shops in Milan looking for partners and investors. 217 investors reject Schultz’s idea, and 39 come on board. He raises the money to open the first Il Giornale. The espresso shop offers ice cream in addition to coffee, has seating, and plays opera music in the background.

12. Sacrifice instant pleasure for the bigger picture

Schultz decides to double down on Il Giornale. He has no income for the first year, and hardly any investors. Instant pleasures of fine dining and expensive travel are out of the question.

“For a year, Sheri and I lived off of her salary while I tried to raise funds. I heard “no” more than 200 times, but eventually, enough people believed in my vision that they invested in me, and in the business.“

Howard and Sheri decide to put everything on the line for the idea of bringing espresso bars to America. Today, you can’t imagine America without Starbucks. Long-term outlook brings more benefits than instant pleasures.

13. Deal with your deepest fears

Intrinsic motivation is a powerful drive. People are more willing to fight for the core principles, than a bag of cash. Schultz is deeply moved by his childhood.

He’s building a company where his father can work and live in peace. The fear of not having healthcare, 3-meal days, and overall financial insecurity stays with Schultz.

“The image of my father immobile on the couch, after his accident, stayed with me. So did the fear of not having healthcare. Not long after he passed away, in 1988, Starbucks became one of the first companies in America to give health insurance to all its employees — including part-time workers, a benefit that was unheard of at the time, especially in retail.”

He deals with that fear by building a company that treats the employees right and gives them full coverage, which is now becoming an American standard.

14. Help others with all your hearth

Gratitude is a 2-way street. Life doesn’t have to be a zero-sum game. If you make other lives better, people are willing to return that favor. Win-win. You can hardly forget when someone helps you turn things around.

“Often, organizations need bold, grand gestures to galvanize people towards a new mission or refocus their attention.”

Starbucks becomes the first company to turn most of its employees to shareholders. Schultz organizes the Bean Stock program for baristas and other workers. Ben Stock generates more than $1.5 billion over the past 3 decades.

Kaycee Kiesz, one of the original baristas, treats her Bean Stock account as a financial savings net. She has paid off $2,500 in student loans, made a $60,000 down payment on her first home, and has traveled around the globe. Her stock has soared 13,000%, and Kiesz plans to sell a part of it to pay for her wedding.

15. Boldly visit uncharted territory

China is not a country of coffee drinkers. Tea dominates the 1.3 billion people market. 90s Shanghai and Beijing have close to zero coffee shops.

Tea has a tradition going back thousands of years, all the way to Emperor Shennong. Chinese have perfected the art of brewing leaves to enjoy the finest tea in the world. Howard Schultz sees an opportunity, even though the market sentiment is aggressively unfavorable.

“China traditionally has been a tea-drinking country but we turned them into coffee drinkers.”

First Starbucks opens in Beijing in 1999. Then, 4,300 stores in 180 cities follow shortly, employing over 58,000 partners. Coffee is more expensive than in the US, making it a luxury high-end meeting spot for Chinese.

16. Never desert your own family

Trouble is an essential part of life and business. Over the years, your family and your company live through tough decisions and smooth rides.

Howard Schultz steps down as a CEO in 2000 but returns back in 2008 when the company hits a wall of trouble. Schultz is already a billionaire at this point and can live in obscene luxury 20 lives over.

Schultz returns to the company to weather the storm and drive it out of trouble. Starbucks now ranks fifth on Fortune’s list of the World’s Most Admired Companies for 2018, 2019, and 2020.

17. Build a legacy

Schultz retires as a Chairman Emeritus in 2018, meaning he’s still around to do the heavy lifting if trouble calls.

Howards Schultz has built an international legacy that serves millions around the globe. He has employed 3 million people over the years. Millions have received a second and third chance in life over the healthcare program. Baristas have had enough gusto to pay back student loans through Bean stock programs.

Starbucks delivers nearly 4 billion cups every year, averaging at 10.958,904 cups per day, making it the biggest coffee business the world has ever seen.

18. Loyal Family with two kids

Howard Schultz stays true to his wife Sheri and his two kids. Schultz creates an environment for his family to thrive.

“Sheri and I grew our family. Our son, Jordan, was born in 1986, and our daughter, Addison, in 1989. Today, Jordan is a sports journalist and Addison is a social worker. I am most proud that they have grown into kind, generous, hard working adults. Each married someone who shares their values — and, luckily, a love of dogs. Our close-knit family continues to grow.”

Howard Schultz can live the life of wildest imaginations, but he never forgets what’s truly important — your family.

“Success is empty if you arrive at the finish line alone. The best reward is to get there surrounded by winners.”

19. Come together with Starbucks

Many are urging Schultz to run for the next president of the United States as an independent candidate. He’s the 47th richest person on the planet, and he can very much become the 47th President of the US. Unfortunately, he’s not running this year.

Schultz writes an open letter to newspapers about an upcoming intuitive at Starbucks involving partisan gridlock in Washington. On December 27, 2012, Starbucks employees in Washington start writing “come together” on served cups.

“My biggest concern is that America is drifting towards mediocrity and that people don’t recognize — and by people I’m meaning Washington — don’t recognize the sense of urgency and the fact that I don’t think this is a crisis anymore. I think it’s an emergency.”

America is in upheaval right now. The people are divided between Republicans and Democrats in an extreme fashion that resembles a civil war. Schultz is the center candidate that brings the message of unity, and it might be exactly what America needs right now. Not left nor right, Schultz wants to forward.

20. Expose yourself to Change

Nothing grows in the comfort zone. You might be stuck in your home neighborhood and never leave the place. Growth happens when you expose yourself to a new reality.

“My parents really wanted me to get out of New York, be exposed to other people, other ways of life.”

You might be mentally stuck too. Some travel, but never grow. Nevertheless, meeting new cultures and people has the power to make you less bigoted.

21. Sell only what you believe in

Trying to sell a product you can’t stand is a sure way to failure. Nobody like snake-oil salesmen, hence the saying. If you don’t believe in your product, find something else to sell.

“I probably have about four or five cups of coffee a day. I make myself an espresso macchiato when I wake, which is a shot of espresso and just a dollop of steamed milk. Then, if I’m going to do some work at home, I would make myself a French press. It’s the best way to make conventional coffee.”

Schultz believes in Starbucks and Italian espresso. Starbucks believes in Schultz too. The two-way street has made the world a better place for coffee lovers and coffee makers.

Comments / 0

Published by

Bringing you the latest reports on current events, lifestyle, and money.

Miami, FL
16439 followers

More from Toni Koraza

Comments / 0