Jan 29, 2019

3. Starbucks has a 2020 problem

Illustration: Rebecca Zisser/Axios

Starbucks chairman emeritus Howard Schultz is a long shot to win the White House, but a sure bet to create headaches for the coffee chain he turned into a global empire.

Why it matters: Schultz's reputation and fortune comes from his time as the Ray Kroc of coffee, turning a small Seattle roaster with four stores into a 28,000-store phenomenon spanning 77 countries. That means massive scrutiny of Starbucks, by both the media and political opponents, unlike anything the company has yet experienced.

A former presidential campaign staffer says: "If I were the DNC or RNC, I'd already be sending people to Starbucks stores around the country, looking for employees with serious complaints."

  • "Maybe complaints that they emailed Schultz about but didn't hear back. Or the former mom and pop coffee shop that was put out of business when Starbucks showed up. It only takes one."

Schultz's successor as CEO, Kevin Johnson, emailed the chain's 350,000 employees worldwide a message at 6 a.m. yesterday that said: "As a company, we don’t get involved in national political campaigns. And nothing changes for Starbucks."

  • Good luck with that. If the company is publicly attacked, it will have little choice but to defend itself.
  • In fact, Starbucks officials have prepared for a media onslaught, and have studied the cases of other business titans who have run for office.

Schultz and Starbucks are tied at the hip, which means they'll need to work together. Kind of like Mitt Romney and Bain Capital in 2012.

  • For Schultz, that means quickly identifying supporters in upper Starbucks management (including in the communications and legal departments), and leveraging those people when the campaign needs time-sensitive answers.
  • It also would be beneficial to tap a former Starbucks executive as a trusted go-between, like Romney did with former Bain Capital co-founder Bob White.

Go deeper:

Go deeper

Coronavirus kills 2 Diamond Princess passengers and South Korea sees first death

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. U.S. numbers include Americans extracted from Princess Cruise ship.

Two elderly Diamond Princess passengers have been killed by the novel coronavirus β€” the first deaths confirmed among the more than 600 infected aboard the cruise ship. South Korea also announced its first death Thursday.

The big picture: COVID-19 has now killed more than 2,200 people and infected over 75,465 others, mostly in mainland China, where the National Health Commission announced 118 new deaths since Thursday.

Go deeperArrowUpdated 4 hours ago - Health

SoftBank to cut its stake to get T-Mobile's Sprint deal done

Illustration: Rebecca Zisser/Axios

T-Mobile and Sprint announced a revised merger agreement that will see SoftBank getting a smaller share of the combined company, while most shareholders will receive the previously agreed upon exchange rate. The companies said they hope to get the deal as early as April 1.

Why it matters: The amended deal reflects the decline in Sprint's business, while leaving most shareholders' stake intact and removing another hurdle to the deal's closure.

Axios Dashboard

Keep up with breaking news throughout the day β€” sign up for our alerts.