If you ask a random person on the street who started Starbucks, nine times out of ten they’ll say "Howard Schultz." Honestly, it makes sense. He's the guy who turned the green mermaid into a global religion. He’s the face of the brand. But here’s the thing: he didn't actually found it.
The real story is way more "indie bookstore" and way less "corporate titan."
The founder of Starbucks wasn't one person; it was a trio of academics who just really, really loved dark-roasted coffee. We’re talking about Jerry Baldwin (an English teacher), Zev Siegl (a history teacher), and Gordon Bowker (a writer).
In 1971, these three friends opened a tiny shop in Seattle’s Pike Place Market. They didn't sell lattes. They didn't sell frappuccinos. They didn't even sell a cup of brewed coffee to go. They sold high-quality beans and the equipment to brew them at home. Basically, they were the original coffee snobs of the Pacific Northwest.
The Three Men Who Hated Bad Coffee
The trio met while students at the University of San Francisco. They weren't business moguls. They were guys who liked the arts and fine food. At the time, American coffee was mostly "brown water" in a tin can. Think Folgers or Maxwell House.
Then they met Alfred Peet.
Peet was a Dutch immigrant who ran Peet’s Coffee & Tea in Berkeley, California. He was the one who taught them the "dark roast" style. He was their mentor, their supplier, and the guy who basically sparked the idea that people might actually pay for coffee that tasted like something.
- Jerry Baldwin: The English teacher who became the first CEO.
- Zev Siegl: The history teacher who was the company’s only paid employee at the start. He was the one actually scooping beans for customers.
- Gordon Bowker: The writer who helped come up with the name.
The name itself is a whole vibe. They wanted something that felt "seafaring." Bowker’s business partner, Terry Heckler, thought words starting with "st" sounded powerful. They eventually landed on "Starbuck," the first mate in Herman Melville’s Moby-Dick. It had nothing to do with coffee, but it sounded cool.
Where Howard Schultz Actually Fits In
So, if those three started it, why is Howard Schultz always the one in the headlines?
Schultz didn't show up until 1981. He was a salesman for a Swedish housewares company called Hammarplast. He noticed this tiny Seattle shop was ordering a ton of plastic cone filters. Like, way more than big department stores.
Curious, he flew out to Seattle. He walked into the Pike Place store, smelled the roasting beans, and—this is a real quote from his memoir Pour Your Heart Into It—he felt like he was "discovering a new continent."
He spent a year hounding the founders to hire him. Eventually, they did. He became the Director of Retail Operations and Marketing in 1982.
The Milan Epiphany
The "Starbucks" we know today was actually born in Italy. In 1983, Schultz went to a trade show in Milan. He walked into an Italian espresso bar and saw the theater of it: the baristas (whom they called baristi) knew the customers' names. People stood and drank tiny cups of espresso. It was a community.
Schultz ran back to Seattle and told the founders, "We shouldn't just sell beans. We should sell the drinks! We should be the 'third place' between work and home!"
The founders hated the idea. They thought Starbucks was a retailer, not a restaurant. They didn't want to get into the beverage business. They actually let Schultz test a small espresso bar in one of their stores in 1984, and it was a massive hit. People were lining up. But Baldwin and the others still weren't convinced. They wanted to stay "pure" to the bean-selling mission.
The Big Split and the $3.8 Million Gamble
Since the founders wouldn't budge, Schultz quit in 1985 to start his own coffee shop called Il Giornale.
Interestingly, the original Starbucks founders actually invested in his new company. They weren't enemies; they just had different visions. But by 1987, the founders decided to sell Starbucks. They wanted to focus on Peet’s Coffee (which they had bought a few years prior).
Schultz scrambled to raise the money. It wasn't easy. At one point, a local investor tried to go behind his back and buy the company out from under him.
This is a wild piece of history: Schultz only saved the deal because Bill Gates Sr. (the father of the Microsoft founder) stepped in. Gates Sr. was a towering, 6'7" attorney who literally walked Schultz across the street to the rival investor's office and told him, in no uncertain terms, to back off.
Schultz bought Starbucks for $3.8 million in August 1987. He merged it with Il Giornale, kept the Starbucks name, and the rest is history.
What Most People Get Wrong About the "Founder"
The reason people get confused is that Schultz is the founder of the Starbucks Corporation as it exists today, but Baldwin, Siegl, and Bowker are the founders of the Starbucks brand and name.
If the original trio hadn't been so obsessed with quality, Schultz would have had no foundation to build on. If Schultz hadn't been so obsessed with the Italian café experience, Starbucks would probably still be a small chain of bean shops in Washington state—or out of business entirely.
Comparing the Visions
The original founders' goal was Coffee Education. They wanted to teach you how to make a great cup at home.
Schultz’s goal was Coffee Experience. He wanted you to pay for the atmosphere, the couch, the music, and the community.
Why This History Matters Right Now
Starbucks is currently in a bit of a mid-life crisis. The "Third Place" vibe has definitely faded. With the rise of mobile orders and drive-thrus, it feels more like a fast-food joint than a cozy Italian café.
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The new CEO, Brian Niccol, has been vocal about "returning to the roots." He’s literally talking about bringing back the comfortable chairs and the "coffeehouse" feel that Schultz fought the original founders for.
If you’re looking to apply these lessons to your own business or career, here’s the takeaway:
- Identify your "Peet": Find a mentor who is doing the craft better than anyone else. The founders wouldn't have succeeded without Alfred Peet.
- The "And" vs. "Or" Trap: The original founders thought they had to choose between selling beans or selling drinks. Schultz realized they could do both.
- Protect the "Magic": When you scale, you lose the "soul" of the original shop. If you’re a business owner, look at your "Pike Place" equivalent—what was the one thing that made people fall in love with you at the start?
To really understand the brand, you have to look at the 1971 Pike Place store. It’s still there. It still uses the original, brown, bare-chested siren logo (which was considered too "suggestive" for the later green logo). It’s a reminder that before the billions of dollars and the mobile apps, it was just three guys who were tired of drinking bad coffee.
Next Steps for the Curious:
- Research the "Third Place" concept by sociologist Ray Oldenburg to understand the psychological theory Schultz used.
- Compare the current Starbucks menu to the 1971 original "bean list" to see how much the flavor profile has shifted from dark roast to sugary "handcrafted" beverages.
- Watch interviews with Jerry Baldwin on the early days to see the perspective of the man who actually gave Howard Schultz his start.