Heady aroma of fresh-roasted coffee beans wafts in the air as Starbucks opens for business and its founders pass out free sample cups of coffee to their first customers on March 30, 1971.

  • By Sheila Farr
  • Posted 2/15/2017
  • HistoryLink.org Essay 2075

On the morning of March 30, 1971, Jerry Baldwin (b. 1942), Gordon Bowker (b. 1942), and Zev Siegl (b. 1942) flip on the lights and set a sandwich board outside their new coffee shop at 2000 Western Avenue -- and then wait. The first customer to step in is their friend Dan Chasan, on his way to the nearby Pike Place Market, his two-year-old daughter Sarah in tow. They don't (and won't for more than a decade) sell coffee drinks, but the three proprietors, eager to try out their sales technique, brew Chasan a free sample cup of coffee. Then they scoop out deliciously aromatic beans from glass-fronted bins, hold them under his nose, and expound on the characteristics of coffee from Ethiopia, Columbia, Guatemala, Arabia, and other exotic locales. Chasan goes for the Sumatra, at $1.75 a pound, chooses some tea, and writes a check for $5.36. Another friend comes in with a bottle of white wine to celebrate the store opening, so Chasan stays to share it. He gives a little taste to Sarah and she begins running in exuberant circles around the store. Starbucks is in business.

A Do-it-yourself Operation

The three partners, who met by chance while college students, had been looking for a business opportunity together. It was Bowker who came up with the idea for a coffee company. Unable to find good coffee in Seattle, he'd been driving to Vancouver, B.C., to buy his coffee beans, and taking orders from friends.

Most coffee sold in the U.S. at that time was low-grade ground-coffee-in-a-can, weakly percolated at home or left sitting on restaurant burners for hours. The focus of Starbucks's business selling coffee beans would be quality and freshness. The owners figured once Seattleites tasted a great cup of coffee, they would come back for more. But they never could have guessed how much the company they founded would change public perception of what a cup of coffee could be, and how much they would pay for it.

Starbucks began as a do-it-yourself operation. The carpentry -- building a counter, coffee bins, and shelving -- took place in Siegl's parents' basement. Baldwin did the electrical work. Bowker was in charge of painting. Bowker and Siegl made the outdoor signs. As for venture capital: They each chipped in around $1,500 and somehow persuaded a bank to loan them $5,000.

1971 was not an auspicious time to be starting a business in Seattle. It was the height of the Boeing Recession, when real-estate prices bottomed, houses stood empty on Capitol Hill, and a billboard sign famously asked that the last person leaving Seattle turn out the lights. The good news for entrepreneurs was that rent was cheap. Baldwin, Bowker, and Siegl leased their storefront in the lower level of the old Harbor Heights Hotel for $137.50 a month. The space, near the corner of Western and Virginia just outside the Pike Place Market, had been long inhabited by a junk shop and before they could clean and paint they had to cart out some 90 cubic yards of trash.

Finally Open for Business

They had intended to open earlier in the spring of 1971, but by the time all the work was done and all the permits in place, the opening date had been pushed back to March 30. Finally that morning Daniel Jack "Dan" Chasan, who had been regularly stopping by to see how they were progressing, saw the sandwich board announcing the store was open and stepped in with his daughter to claim the title of first customer.

That first year, Siegl was the company's only employee. Baldwin kept his job at Boeing while Bowker, a writer and creative thinker, was a partner in the advertising agency Heckler Bowker. His partner Terry Heckler created the original Starbucks logo: a bare-breasted mermaid who served as a siren to lure in customers. Bowker strategized on how to promote the company.

Initially Starbucks bought roasted coffee beans from Peet's Coffee and Tea in Berkeley, California. Peet's was the model for Starbucks and Alfred Peet (1920-2007), a Dutch immigrant who'd grown up in the family coffee business, was a mentor to the three Starbucks partners. But in 1972, when Starbucks opened a second store at University Village, the company bought a used roaster and began roasting its own coffee in a warehouse near Fisherman's Terminal. Baldwin took over the roasting and buying duties.

Beans in Bulk, but No Espresso Bar

It's important to note that at that time, the early Starbucks stores were nothing like the espresso-bar cafes around the globe that now bear the Starbucks name, sleek table-filled hangouts for customers absorbed in their laptop computers. There were no plastic-topped paper cups printed with the company logo. Picture instead an old-fashioned handmade store counter, with a row of bulk coffee bins below it. On top there was a scale to weigh out coffee beans and funnel them into one-pound bags. One of the owners would grind the coffee for you, or sell you a grinder so you could do it at home. You'd be offered a free sample cup of drip coffee at the store, but the stores sold no brewed coffee until 1982, when Starbucks set up shop at 4555 University Way NE. That store, the company's fifth, was designed by Seattle architect George Suyama and featured the first Starbucks coffee bar.

Starbucks began to change soon after. Howard Schultz (b. 1953) was hired as marketing director in 1982 and in 1984 Starbucks bought Peet's stores and roasting plant in the San Francisco Bay area. Schultz resigned in 1986 to start his own business. In 1987, Bowker decided to sell his stake in Starbucks (Siegl had left in 1980) and Baldwin, needing cash, made the decision to keep Peet's and put Starbucks up for sale. Schultz and a group of investors bought the company for $3.8 million and rapidly began expanding it. Now, of course, people around the world know Starbucks as a dominant force in the global coffee industry and a ubiquitous brand. Almost anywhere you go, there is a Starbucks to be found nearby.

With such widespread fame, it's no wonder that tourists visiting Seattle are eager to see the original Starbucks, where it all began so long ago. But in fact the original store no longer exists. The old Harbor Heights Hotel building was torn down in 1976, a victim of urban renewal, and Starbucks moved its flagship store up the street to 1912 Pike Place in the Market, where it remains today.


Sources:

Sheila Farr interviews with Zev Siegl (October 4, 2016), Jerry Baldwin (telephone, October 5, 2016), and Gordon Bowker (October 5, 2016), notes, recordings, and transcripts in possession of Sheila Farr, Seattle, Washington; Farr Zev Siegl email to Sheila Farr, November 1, 2016, in possession of Sheila Farr; Gordon Bowker email to Sheila Farr, November 1, 2016, in possession of Sheila Farr; Starbucks annual reports, 1972-1986, copies in possession of Gordon Bowker; Mark Pendergrast, Uncommon Grounds: The History of Coffee and How it Transformed Our World (New York: Basic Books, rev. ed. 2010); Howard Schultz and Dori Jones Yang, Pour Your Heart Into It (New York: Hyperion, 1997); Howard Schultz and Joanne Gordon, Onward: How Starbucks Fought For Its Life Without Losing Its Soul (New York: Rodale, 2011); Don Duncan, "A New Source for That Heady Aroma," The Seattle Times, June 17, 1971, p. B-1; John Wilson, "City to Sell 3 Acres Near Market for New Housing," Ibid., October 20, 1976, p. D-1; "Alfred H. Peet, 87, Dies; Leader of a Coffee Revolution," The New York Times, September 3, 2007 (http://www.nytimes.com); Daniel Jack Chasan, "How Great Corporate Power Shadows Gregoire on Coal Shipments" [sic -- the article posted under this headline is Chasan's reminiscence of being the first customer at the first Starbucks], Crosscut, March 9, 2011 (http://crosscut.com/2011/03/how-great-corporate-power-shadows-gregoire-on-coal/); "Starbucks Company Timeline," Starbucks website accessed November 30, 2016 (https://www.starbucks.com/about-us/company-information/starbucks-company-timeline).
Note: This essay replaces an earlier essay on the same subject.    


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