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The Starbucks story involving his father is incredible. Schultz had actually left Starbucks and started his own coffee chain (Il Giornale) when the founders of

The Starbucks story involving his father is incredible. Schultz had actually left Starbucks and started his own coffee chain (Il Giornale) when the founders of Starbucks didn't want to expand the number of stores. They mostly just wanted to roast coffee. When the chance to buy Peet's came up, they decided to buy that instead and put Starbucks up for sale. Schultz was actually super passionate about Starbucks and jumped at the opportunity to buy it. Then one of his investors from Il Giornale tried to undercut him by putting in a higher bid for Starbucks. Bill Gates' dad was apparently a highly respected lawyer in the Seattle area and Schultz went to him for help. Bill Gates Sr. called the investor and gave him some tough talks and the investor withdrew his bid. It's incredible that senior Gates did that out of a sense of fairness and righteousness. Source: https://www.stitcher.com/podcast/wondery/business-wars/e/67717289 https://www.stitcher.com/podcast/wondery/business-wars/e/677... (This is the start of the series. The story itself is a few episodes into the series)

throwaway5752 6y ago
Thanks for the link. It is incredible to think that one man was substantially, if indirectly and in very different ways, involved in creating both Starbucks and Microsoft. It's a nice story and a reminder of the place for ethics and personal reputation in business.
nuclearnice1 6y ago
I guess I need to dig a little deeper into that Starbucks thing. But if I was an owner of Starbucks and Bill Gates Sr called the high bidder and scared him off so someone else could buy my business for less, I don’t know if I’d ever forgive that. It doesn’t strike me as fair or righteous.
- hangonhn 6y ago
  I see what you're saying. Here's the CNBC version of it: https://www.cnbc.com/2017/10/04/bill-gates-sr-helped-howard-schultz-buy-starbucks.html https://www.cnbc.com/2017/10/04/bill-gates-sr-helped-howard-... It sounds like the Starbucks owners already offered it to Schultz and gave him 90 days to buy it and it was an exclusive offer. Part way through fundraising, an Il Giornale investor caught wind of it and approached Starbucks with a higher bid. I think the fact that Starbucks had offered it to Schultz first and then his own investor tried to undermine him and Il Giornale is sort of rotten and underhanded. I think the fact that Starbucks had offered it to Schultz first and agreed on a price and Il Giornale's own investor tried to undermine the deal is where things get a little shady. Apologies for telling the story poorly and missing some important details.
  - nuclearnice1 6y ago
    Tough call. If you and I handshake on buying my house, you’re rightfully upset when I sell to someone else for more. On the other hand, all we had is a handshake, so I’m rightfully upset when you chase off a higher bid. I guess how shady depends on the agreement that Schultz had. The fact that Sr was able to chase them off suggests the agreement was at least of some substance.
    - throwaway0a5e 6y ago
      As someone who buys and sells a lot of equipment and machine tools having someone sell to someone else after you have a deal is far more infuriating than getting "oh but I would have paid 20% more" after you sealed a deal.
    - deleted 6y ago
      [deleted]
    - tlb 6y ago
      In SV fundraising deals, going back on a handshake is considered pretty bad behavior. Investors stand to lose many future deals if they break one without a darn good reason. Discovering a serious misrepresentation is such a reason, but seeing a better deal elsewhere is not. The point of handshake deals is to give everyone time to get the details right, without the pressure of having the deal stolen. Forcing parties to rush through the details damages the whole ecosystem, so everyone is motivated to encourage everyone else to respect handshake deals.
      - deleted 6y ago
        [deleted]
      - bredren 6y ago
        I did not know this raising my last round, but it was legit. The money was as good as wired.
      - jjeaff 6y ago
        That happened to us and on this VC firm's maiden round. They offered no reason except that they reconsidered. Wasted months of our time. Our attorney (from Fenwick & West) told us the same, that it would damage the VCs reputation and that this was pretty much unheard of for them. But I never heard another thing about it and that VC firm seems to not be having too much trouble filling out their rounds.
- tptacek 6y ago
  Bear in mind that the Starbucks you're probably thinking of, when you think "Starbucks", was created largely by Schulz after that acquisition happened. This story took place in 1987.
  - benatkin 6y ago
    Timeline of Bill Gates: https://legacy.npr.org/news/graphics/2008/june/bill_gates/gates_timeline_04.html https://legacy.npr.org/news/graphics/2008/june/bill_gates/ga... So he was a billionaire or a soon-to-be billionaire.
    - chipotle_coyote 6y ago
      I think tptacek's point wasn't about Gates's wealth, it was that Starbucks at the time was pretty tiny. It (Starbucks) has a kind of interesting history, tangled up with Peet's Coffee & Tea in its very early years. (Starbucks also used to be a lot more, well, serious about coffee, selling fresh-roasted coffee in bins in the store rather than bags shipped out from central roasters, as well as selling a small but well-curated selection of brewing equipment that wasn't just Starbucks-branded stuff. Peet's still has some of that vibe, although they're less eclectic now than they were even 15 years ago.)
  - nuclearnice1 6y ago
    Yeah this was six stores. The offers were 3.8M and 4M. What’s the importance of bearing that in mind?
    - tptacek 6y ago
      That it's easy to say with the benefit of hindsight that the rival bidders for Starbucks would have been cheated out of a fortune, but unclear that the fortune was theirs to be had even if they'd won the bid. What's more likely is that Schulz would simply have started a different chain, and we'd be talking about that company the way we do about Starbucks now.
      - 6y ago
op03 6y ago
Also told in Schultz book's Pour Your Hear Into It which is quick interesting read. Moral of the story is to cultivate and understand the value of your Network. It takes a village to compensate for things you cant do by your self. If you are not a networking type, latch on to/be useful to/connect with a couple networking types. Every hard problem you hit, that your skill and experience cant solve, talk to them about it.
feralimal 6y ago
Is that meant to show how Bill Gates Sr is a good guy? Reading between the lines, it sounds like he put the screws on the 'other' guy with the higher bid, as his 'man' had to win. Probably I was triggered by you saying "highly respected lawyer". lol. And, he also ran planned parenthood.

throwaway5752 6y ago

Thanks for the link. It is incredible to think that one man was substantially, if indirectly and in very different ways, involved in creating both Starbucks and Microsoft. It's a nice story and a reminder of the place for ethics and personal reputation in business.

nuclearnice1 6y ago

I guess I need to dig a little deeper into that Starbucks thing. But if I was an owner of Starbucks and Bill Gates Sr called the high bidder and scared him off so someone else could buy my business for less, I don’t know if I’d ever forgive that. It doesn’t strike me as fair or righteous.

hangonhn 6y ago
I see what you're saying. Here's the CNBC version of it: https://www.cnbc.com/2017/10/04/bill-gates-sr-helped-howard-schultz-buy-starbucks.html https://www.cnbc.com/2017/10/04/bill-gates-sr-helped-howard-... It sounds like the Starbucks owners already offered it to Schultz and gave him 90 days to buy it and it was an exclusive offer. Part way through fundraising, an Il Giornale investor caught wind of it and approached Starbucks with a higher bid. I think the fact that Starbucks had offered it to Schultz first and then his own investor tried to undermine him and Il Giornale is sort of rotten and underhanded. I think the fact that Starbucks had offered it to Schultz first and agreed on a price and Il Giornale's own investor tried to undermine the deal is where things get a little shady. Apologies for telling the story poorly and missing some important details.
- nuclearnice1 6y ago
  Tough call. If you and I handshake on buying my house, you’re rightfully upset when I sell to someone else for more. On the other hand, all we had is a handshake, so I’m rightfully upset when you chase off a higher bid. I guess how shady depends on the agreement that Schultz had. The fact that Sr was able to chase them off suggests the agreement was at least of some substance.
  - throwaway0a5e 6y ago
    As someone who buys and sells a lot of equipment and machine tools having someone sell to someone else after you have a deal is far more infuriating than getting "oh but I would have paid 20% more" after you sealed a deal.
  - deleted 6y ago
    [deleted]
  - tlb 6y ago
    In SV fundraising deals, going back on a handshake is considered pretty bad behavior. Investors stand to lose many future deals if they break one without a darn good reason. Discovering a serious misrepresentation is such a reason, but seeing a better deal elsewhere is not. The point of handshake deals is to give everyone time to get the details right, without the pressure of having the deal stolen. Forcing parties to rush through the details damages the whole ecosystem, so everyone is motivated to encourage everyone else to respect handshake deals.
    - deleted 6y ago
      [deleted]
    - bredren 6y ago
      I did not know this raising my last round, but it was legit. The money was as good as wired.
    - jjeaff 6y ago
      That happened to us and on this VC firm's maiden round. They offered no reason except that they reconsidered. Wasted months of our time. Our attorney (from Fenwick & West) told us the same, that it would damage the VCs reputation and that this was pretty much unheard of for them. But I never heard another thing about it and that VC firm seems to not be having too much trouble filling out their rounds.
tptacek 6y ago
Bear in mind that the Starbucks you're probably thinking of, when you think "Starbucks", was created largely by Schulz after that acquisition happened. This story took place in 1987.
- benatkin 6y ago
  Timeline of Bill Gates: https://legacy.npr.org/news/graphics/2008/june/bill_gates/gates_timeline_04.html https://legacy.npr.org/news/graphics/2008/june/bill_gates/ga... So he was a billionaire or a soon-to-be billionaire.
  - chipotle_coyote 6y ago
    I think tptacek's point wasn't about Gates's wealth, it was that Starbucks at the time was pretty tiny. It (Starbucks) has a kind of interesting history, tangled up with Peet's Coffee & Tea in its very early years. (Starbucks also used to be a lot more, well, serious about coffee, selling fresh-roasted coffee in bins in the store rather than bags shipped out from central roasters, as well as selling a small but well-curated selection of brewing equipment that wasn't just Starbucks-branded stuff. Peet's still has some of that vibe, although they're less eclectic now than they were even 15 years ago.)
- nuclearnice1 6y ago
  Yeah this was six stores. The offers were 3.8M and 4M. What’s the importance of bearing that in mind?
  - tptacek 6y ago
    That it's easy to say with the benefit of hindsight that the rival bidders for Starbucks would have been cheated out of a fortune, but unclear that the fortune was theirs to be had even if they'd won the bid. What's more likely is that Schulz would simply have started a different chain, and we'd be talking about that company the way we do about Starbucks now.
    - 6y ago

op03 6y ago

Also told in Schultz book's Pour Your Hear Into It which is quick interesting read. Moral of the story is to cultivate and understand the value of your Network. It takes a village to compensate for things you cant do by your self. If you are not a networking type, latch on to/be useful to/connect with a couple networking types. Every hard problem you hit, that your skill and experience cant solve, talk to them about it.

feralimal 6y ago

Is that meant to show how Bill Gates Sr is a good guy? Reading between the lines, it sounds like he put the screws on the 'other' guy with the higher bid, as his 'man' had to win. Probably I was triggered by you saying "highly respected lawyer". lol. And, he also ran planned parenthood.