Back in 2023, Starbucks rolled out a new drink, the Oleato, created by then-CEO Howard Schultz himself. A mix of coffee and olive oil, the concoction was met with a range of responses, from “not that bad” to “makes you poop your pants.” While not the wildest coffee combination to go viral in the post-COVID world, the Oleato’s widespread rollout to all US Starbucks-operated and licensed cafes—as well as to locations in Canada, France, Japan, England, and China—left many scratching their heads as to how the divisive drink could have made such a splash.
Turns out, it may be because Schultz was looking to do a little double dipping. Partanna, the brand of olive oil used in all Oleato beverages, is partially owned by the former Starbucks CEO.
As reported by Semafor, Schultz bought a 19% stake in the company named after the Sicilian city it calls home. Between Q4 2022 and Q3 2023, Starbucks has paid Partanna a cool $26.5 million for their olive oil. And it’s not just buying Schultz-brand olive oil, Starbucks is hyping it up by name. On their page for the Oleato, the brand mentions Partanna no less than four times. Schultz himself has even been quotes as saying, “people are going to add a tablespoon of Partanna extra-virgin olive oil into their drink. I’m sure of it.”
Schultz and Starbucks rolled out the Oleato after doing “no consumer research.” Instead, Schultz was “trusting his gut,” believing that the Oleato would “transform the coffee industry.”
Per Semafor, Schultz offered Starbucks the opportunity to invest in Partanna when he was acting as CEO but left the decision up to incoming CEO Laxman Narasimhan, who was in the middle of a “CEO apprenticeship” and ultimately decided to pass.
In a statement about the relationship between Schultz and Partanna, Starbucks states, “Starbucks — through its Board and multiple audit committee meetings—had a strong governance process in place in the establishment of the business relationship with Partanna/United Olive Oil… This included a thorough review of conflict of interest, including ensuring Howard had no role in business decisions related to the Partanna/United Olive Oil relationship.”
I’m sure it’s all just a big coincidence, the Starbucks drink nobody asked for that bypassed all market testing just so happens to line the pockets of their on-again-off-again CEO. So the next time you’re enjoying an Oleato, no doubt hovering over a toilet just in case, you can thank Howard Schultz and his olive oil.
Zac Cadwalader is the managing editor at Sprudge Media Network and a staff writer based in Dallas. Read more Zac Cadwalader on Sprudge.
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Zac Cadwalader
August 1, 2024
