Warm coffee roastery with a vintage roaster, bean sacks, wooden counter, and cafe seating.

The History of Starbucks: From Seattle Retailer to Global Coffeehouse

by

A Quick Look at the History of Starbucks

Company History Summary

Starbucks began in Seattle in 1971 as a specialty retailer focused on roasted whole-bean coffee, tea, spices and brewing equipment. Jerry Baldwin, Gordon Bowker and Zev Siegl founded that original business. The beverage-led coffeehouse model most people now associate with Starbucks came later.

Howard Schultz joined the existing business in 1982, left to build a separate café company called Il Giornale, and then led the 1987 acquisition of Starbucks assets. Il Giornale adopted the Starbucks name, creating the corporate bridge to the modern company. An IPO, international expansion, digital ordering and new consumer-product channels followed, along with major strategic resets in 2008 and again in the mid-2020s.

Company Snapshot

Founded / Origin: 1971

Founders: Jerry Baldwin, Gordon Bowker and Zev Siegl

Origin: Seattle, Washington

Original Business: Specialty retailing of whole-bean coffee, tea, spices and brewing equipment

Modern Corporate Turning Point: In 1987, Il Giornale acquired Starbucks assets and adopted the Starbucks name

IPO: June 26, 1992

Current Leadership: Brian Niccol, chairman and CEO as of the September 8, 2026 research cutoff

Reportable Segments: North America, International and Channel Development

Store Base: 41,304 stores globally as of June 28, 2026

Mainland China Retail Structure: Boyu-managed funds hold 60% of the retail joint venture and Starbucks holds 40%; Starbucks continues to own and license the brand and intellectual property

From Whole-Bean Retailer to Coffeehouse Concept

The original Starbucks opened in Seattle in 1971. Baldwin, Bowker and Siegl built the business around roasted whole-bean coffee and related products rather than a beverage-led café experience.

Howard Schultz entered the story more than a decade later. He joined Starbucks in 1982 and became interested in a stronger espresso-bar model. Starbucks tested espresso, but the founders did not want the beverage concept to displace the business’s primary focus on selling coffee beans at retail.

Schultz left Starbucks in 1985 and started Il Giornale, a separate café company inspired by Italian coffee bars. Starbucks remained connected to the venture as an investor and supplier, and Il Giornale served Starbucks beans in its coffee and espresso drinks.

The 1987 Deal That Created the Modern Corporate Lineage

The decisive transition came in 1987. Il Giornale acquired Starbucks’ name, roasting plant and Seattle stores and then adopted the Starbucks name. Starbucks’ historical account says Schultz raised $3.8 million for the transaction.

This distinction matters because two different founding stories are often blended together. Baldwin, Bowker and Siegl founded the original 1971 Starbucks. Schultz founded Il Giornale and became central to the corporate lineage that acquired Starbucks’ assets and built the post-1987 company.

IPO and International Scale

Starbucks completed its initial public offering on June 26, 1992. The original offering price was $17 per share before later stock splits. Public ownership gave the company additional financial flexibility during a period of rapid expansion, although the IPO was only one part of the growth story.

International expansion became increasingly important. Starbucks and Sazaby established Starbucks Coffee Japan as a joint venture in the mid-1990s, and the first Tokyo store opened in 1996. Japan became an important early market outside North America and an example of Starbucks using a partnership structure for international growth.

Over the following years, Starbucks expanded its store network and brand presence across multiple markets. The broader change was more important than any country-by-country opening sequence: a regional U.S. coffee retailer had become a large international coffeehouse business.

The 2008 Reset

By 2008, the growth story had run into serious operating pressure. Starbucks’ fiscal 2008 filing reported a 5% decline in U.S. comparable-store sales, with lower customer traffic identified as the primary driver.

On January 7, 2008, Starbucks announced that Howard Schultz would return as CEO while remaining chairman. The company slowed planned U.S. growth and committed to closing approximately 600 underperforming company-operated stores. It also restructured its Australia operations and reduced leadership and non-store roles.

The reset included renewed attention to coffee quality, store experience and store-level economics. The filing also described weaker traffic and a difficult economic environment, making 2008 a broader operating and economic retrenchment rather than a single-cause story.

For a business built on physical locations, the lesson was practical: store count could not substitute for healthy unit economics and a consistent customer experience.

Digital Growth, Teavana and New Channels

Starbucks’ next growth cycle moved beyond simply adding stores. In September 2015, Mobile Order & Pay became available across U.S. company-operated stores after a staged rollout, making digital ordering part of the core store experience.

Not every expansion bet became a durable retail format. In 2017, Starbucks announced plans to close all 379 Teavana retail stores after saying many mall-based locations had persistently underperformed. The Teavana brand and products continued, but the standalone store chain was wound down.

In 2018, Starbucks entered the Global Coffee Alliance with Nestlé. Nestlé agreed to pay $7.15 billion upfront for rights to market, sell and distribute specified Starbucks consumer and foodservice products globally outside Starbucks stores. Ready-to-drink products and sales inside Starbucks coffee shops were excluded.

The alliance gave Starbucks another route to expand its brand beyond its own retail network while relying on Nestlé’s distribution infrastructure.

Racial-Bias Response, Pandemic Disruption and Labor Organizing

In April 2018, Starbucks announced that more than 8,000 U.S. company-owned stores would close for an afternoon of racial-bias education involving nearly 175,000 employees. The decision followed events in Philadelphia and turned a local crisis into a system-wide company response.

COVID-19 brought a different kind of disruption. In the quarter ended March 29, 2020, Starbucks faced widespread temporary store closures and modified operations. The company reported that second-quarter net revenues fell 4.9% year over year and operating income fell 43.2%.

Labor organizing then became a more prominent part of Starbucks’ modern history. In late 2021, a Buffalo bargaining unit voted 19-8 for Workers United, and the National Labor Relations Board issued certification on December 17, 2021. Starbucks’ 2026 SEC filing continued to identify labor-organizing litigation as an active legal matter.

Leadership Turnover and Another Reinvention

Starbucks entered another period of leadership change in 2022. Kevin Johnson retired, and Howard Schultz returned as interim CEO.

That year Starbucks announced a Reinvention Plan focused on store operations, employee experience, equipment, digital systems and customer connection. Schultz described the moment succinctly: “Our success is not an entitlement.”

Laxman Narasimhan formally assumed the CEO role in March 2023. In August 2024, Starbucks announced another change: Brian Niccol would become chairman and CEO effective September 9, 2024, while Narasimhan stepped down.

The succession placed Starbucks in another strategic reset rather than a settled new era.

“Back to Starbucks” and a More Licensed Global Model

Under Niccol, Starbucks introduced the “Back to Starbucks” strategy, emphasizing coffeehouse experience, service speed, menu simplification, customer connection, digital experience and operating discipline.

The company followed with a substantial restructuring. Starbucks’ fiscal 2025 filing documented 627 store closures in the fourth quarter under the plan. The move recalled the 2008 retrenchment in one narrow respect: Starbucks was again pruning parts of its store portfolio while trying to improve the operating system. The causes and circumstances were different, and the latest turnaround remained in progress at the September 8, 2026 research cutoff.

Mainland China also shifted to a different ownership model. A joint venture with Boyu Capital was finalized in 2026. Boyu-managed funds hold 60% of the retail joint venture, while Starbucks retains 40% and continues to own and license the Starbucks brand and intellectual property.

The accounting effect was significant. Starbucks reported 41,304 stores globally as of June 28, 2026, including 18,371 in North America and 22,933 internationally. Following the China transaction, 7,991 China stores moved from company-operated to licensed classification. Starbucks also stated that its international business was shifting toward a more predominantly licensed model.

That current structure shows how far Starbucks has moved from its original retail shop. The business now combines company-operated stores, licensed stores, joint ventures, digital ordering and a consumer-products channel linked heavily to the Nestlé alliance.

Starbucks’ history is not a straight line of expansion. The company repeatedly widened the reach of its coffeehouse model, then recalibrated when growth exposed operating, portfolio or customer-experience pressure. The 1987 corporate transition, the 2008 retrenchment and the 2024-2026 reset were different events, but each changed how Starbucks pursued the next stage of growth.

Timeline

This timeline highlights the major milestones that shaped Starbucks from its 1971 origins through its 2026 corporate structure.

Timeline.

1971

Jerry Baldwin, Gordon Bowker and Zev Siegl establish the original Starbucks business in Seattle as a specialty coffee retailer.

1982

Howard Schultz joins the existing Starbucks business.

1985

Schultz leaves Starbucks and starts Il Giornale, a separate café company. Starbucks remains an investor and supplier.

1987

Il Giornale acquires Starbucks’ name, roasting plant and Seattle stores, then adopts the Starbucks name.

June 26, 1992

Starbucks completes its initial public offering.

1995-1996

Starbucks Coffee Japan is established as a joint venture, and the first Tokyo store opens in 1996.

2008

Howard Schultz returns as CEO as Starbucks slows U.S. expansion and commits to closing approximately 600 underperforming U.S. company-operated stores.

September 2015

Mobile Order & Pay reaches U.S. company-operated stores nationwide.

2017

Starbucks announces plans to close all 379 Teavana retail stores.

2018

Starbucks enters the Global Coffee Alliance with Nestlé for specified consumer and foodservice products outside Starbucks stores.

Starbucks also closes more than 8,000 U.S. company-owned stores for an afternoon of racial-bias education.

2020

COVID-19 causes widespread store closures, modified operations and major financial disruption.

December 2021

The NLRB certifies Workers United at a Buffalo bargaining unit after a 19-8 vote.

2022

Howard Schultz returns as interim CEO, and Starbucks announces its Reinvention Plan.

March 2023

Laxman Narasimhan assumes the CEO role.

September 9, 2024

Brian Niccol becomes chairman and CEO.

Fiscal 2025

The “Back to Starbucks” restructuring includes hundreds of store closures.

April 2026

Starbucks and Boyu Capital finalize the mainland China retail joint venture. Boyu-managed funds hold 60%, Starbucks retains 40%, and Starbucks continues to own and license the brand and intellectual property.

June 28, 2026

Starbucks reports 41,304 stores globally. Following the China joint-venture conversion, 7,991 China stores are classified as licensed rather than company-operated.

Interviews & Firsthand Resources

1987 Il Giornale Acquisition Memorandum

Starbucks’ Il Giornale history page includes a Howard Schultz memorandum to employees dated August 10, 1987. It offers firsthand material on the transition from Il Giornale ownership to the Starbucks name and the continuity of the workforce during the change.

View the resource

Sources