Howard D. Schultz was born on July 19, 1953, to a Fred and Elain Schultz, a Jewish family in Brooklyn, New York. Fred Schultz was a truck driver. Howard has two siblings. Schultz grew up in the Canarsie public housing projects. According to Schultz, his family was poor.
Schultz was a natural athlete, leading the basketball courts around his home and the football field at school. He made his escape from Canarsie with a football scholarship to Northern Michigan University in 1970.
Schultz graduated from Canarsie High School in 1971.
He attended Northern Michigan University (NMU) from 1971 to 1975, graduating with a B.A. in communications.
After graduating Schultz stayed in Michigan and worked at a ski lodge for a year. He then took up a job in New York City as a salesman for Xerox, and was recruited by Swedish kitchenware manufacturer PAI Partners in 1979 to be general manager of its U.S. subsidiary, Hammarplast. At Hammarplast, Schultz was responsible for the coffee machine manufacturer's U.S. operations, and in 1981 he visited the Starbucks Coffee Company in Seattle, Washington to fill their plastic cone filter orders.
In 1982, at age 29, Schultz was hired at Starbucks as the director of retail operations and marketing. Schultz was exposed to Coffee in Italy on a buying trip to Milan, Italy in 1983. On his return, he worked to persuade company owners Jerry Baldwin and Gordon Bowker to offer traditional espresso beverages in addition to the whole bean coffee, leaf teas and spices. After a successful pilot of the cafe concept, Baldwin and Bowker were intrigued but, noting the high cost of espresso machines, the relative paucity of expertise for maintenance and repair of the machines in America, and Americans' lack of familiarity with the drink, they decided not to deploy Schultz's idea further and he stepped down from Starbucks to start his own business. Schultz left Starbucks in 1985 to open a store of his own. He needed $400,000 to start his business. Schultz visited over 500 espresso bars in Milan and, with him assuming most of the risk associated with introducing espresso to the American market, Starbucks invested $150,000 in the new venture, with Baldwin receiving a place on its board and Bowker offering unofficial assistance. Another $100,000 investment from local doctor Ron Margolis. Of the 242 investors Schultz approached, 217 rejected his idea. By 1986, he had raised the money he needed to open the first store, Il Giornale, named after the Milanese newspaper of the same name. The store offered ice cream in addition to coffee, had little seating, and played opera music in the background. Two years later, the original Starbucks management team decided to focus on Peet's Coffee & Tea and sold its Starbucks retail unit to Schultz and Il Giornale for US$3.8 million.
A Starbucks cafe in Xixi National Wetland Park, Hangzhou China
Schultz rebranded Il Giornale with the Starbucks name, and expanded its reach across the United States. This type of market strategy received mix reception from both customers and competitors. The firm's relations with independent coffeehouse chains were strained, while some owners credited Starbucks with educating customers on coffee. Schultz did not believe in franchising, and made a point of having Starbucks retain ownership of every domestic outlet. Schultz's positioning of Starbucks as a social hub is widely seen as introducing the second wave of coffee culture in the U.S., particularly in Seattle. On June 26, 1992, Starbucks had its initial public offering (IPO) and trading of its common stock under the stock ticker SBUX. The IPO raised $271 million for the company and financed the doubling of their stores. On June 1, 2000, Schultz stepped down as CEO of Starbucks, moving to the new position of chief global strategist to help the company expand internationally. He was succeeded by Orin Smith, who worked with Schultz as his chief financial officer during the 1990s. After coordinating the first store opening in China in January 1999, Schultz took the following year to develop a customer base for coffee in the region.[30] Throughout the late-2000s and early-2010s, Schultz directed the company to plan one to two store openings a day in mainland China. Back in the firm's U.S. market, various coffee wars with McDonalds and Dunkin' left lowered Starbucks' market share and the stock price fell 75% from 2006 to 2008. While revenue was growing broadly, it was largely dependent on new store openings creating unsustainable (or inorganic) growth.