June 4, 2012

Breaking: Starbucks Buying La Boulange

There was a collective shudder from foodies local business boosters around the Bay Area this afternoon as this news hit the wire:
Next World Group Sells La Boulange Café & Bakery To Starbucks Coffee Company for $100 Million
SAN FRANCISCO, CA – (June 4, 2012) – Next World Group (NWG), a privately-held global investment firm, today announced that it has reached a definitive agreement to sell La Boulange Café & Bakery to Starbucks Coffee Company (NASDAQ: SBUX) for $100 million in cash.
The transaction is expected to close in the third quarter of 2012 (Starbucks’ FY 12 fourth quarter). Next World Group is the majority investor of La Boulange, a rapidly growing San Francisco-based, fast-casual restaurant chain that embodies the authenticity of the French bakery experience.
Founded by Pascal Rigo, La Boulange has grown to 19 Bay Area locations and has more than quadrupled revenue since NWG’s investment. NWG is a long-term, growth investment firm headquartered in San Francisco, with offices in Brussels and Paris. 
“We have worked closely with Pascal over the past six years to build an artisanal bakery brand with a track record of profitable growth – exactly the kind of enterprise we look for in our investments,” said Sébastien Lépinard, founder of Next World Group. “La Boulange and Starbucks share similar values and a common vision for creating premium products in a socially responsible way. 
We have confidence that Starbucks will stay true to the ‘La Boulange’ brand while bringing the romance of an authentic French bakery to consumers across the United States.” “Our long-term partnership with NWG and Sébastien brought solid financial management and strategic vision to help La Boulange through its growth and success over the last few years,” said Rigo, founder and CEO of La Boulange. “Their involvement and commitment attracted the caliber of management and financial partners we needed to achieve our potential.”
Next World Group invested in La Boulange in 2006, beginning the implementation of a focused strategy to sell distinctive, high-quality products and develop a local cafe-bakery-retail concept under the ‘La Boulange’ brand. Since then, the business has grown geometrically as the strategy to bring enjoyable products to an ever-growing customer base has remained intact.
InsideScoopSF talked to owner/seller Pascal Rigo and broke it down this way:
  • Within 12-14 months, there will be La Bou-branded goods in every Starbucks’ pastry case 
  • La Bou will expand to 200 to 400 units nationwide within the next four to five years
KQED's News Fix rounds up the Twitter reaction (lots of: Ugh, Nooooooo! AYEEE) here.

What do you think Noe Valley? Good thing for Starbucks or will you be taking your business elsewhere?


Anonymous said...

I don't think the foodies are going to care much. The pastries at La Boulange are a step up from the ones you'll find at Starbucks (or Martha's, or any of the other coffee places in Noe), but they're not foodie-level. Those folks are already heading over to Tartine (etc.) to get their croissant or kouign amann on.

murphstahoe said...

Call me old fashioned, Anon, but I head over to the Noe Valley Bakery...

Mario said...

I am sorry but some pastries cannot be found in either Tartine nor Noe Valley Bakery:

Kouign Amann? No
Hazelnut-chocolate croissant? No
Bande Fruit? No
Pots de creme? No
Brioche? No

I really hope they keep a distinct La Boulange brand and let Pascal Rigo remain in charge. Otherwise La Boulange will be missed here.

Nails Doverspike said...

Thanks for keeping your thumb[s] on the cyberpulse. Great item! Looks like Starbucks/Boulange now command two corners on our commercial strip and when I go to Boulange i will be drinking Starbucks coffee (fine but not mine) and if I went into Starbucks I could get some yummy high buttered baked goods in their pastry case. très intére$$ant.

Anonymous said...

Noe Valley Bakery? really?

That's where old ladies go to get a plastic cake for their bridge parties.

murphstahoe said...

Given that the Noe Valley "plaza" at Noe and 24th was clearly a plot from Seattle..


Now that Starbucks is across the street from the hoped for Noe Valley Town Square, Seattle should be sending us the bucks! Problem solved!

Anonymous said...

Seriously. Noe Valley Bakery *looks* good, but I haven't had a single decent thing there. It's really weird. It shouldn't be possible to make pastries that look that good and taste that lousy.

Mario said...

Noe Valley Bakery has a nice love bun. They also used to make a nice brioche until a few years ago, but since then I am only left with my beloved love bun.

Tartine has all sorts of nice things, especially their bread and everything made out of it (croque monsieur), gougere, croissants, morning buns and others, but ... they are missing a lot of French pastry basics.

La Boulange is like the Target of French pastry. There are some things that I can only get there (I honestly don't know where else to buy decently priced socks - I don't really buy anything other than socks from Target). They are the only shop in SF to have their French bakery basics covered.

Anonymous said...

Noe Valley Bakery has great whole wheat sourdough bread and breadsticks. And the croissants are better than most. The rest of it - the sweets - my kids eat. But my kids like the macaroons at Boulange.

The acquisition by St@r$s is actually quite smart, not for us locally but for the company - very complementary. I don't patronize them in any case.

Anonymous said...

Seriously? I think more than half of you need to get your taste buds checked out. The chocolate cherry rugelah there is really divine & I don't even like chocolate & cherries together!!

Their Savory cheese croissant is yummers, the scones are great & their challah is superb. Try this for a morning breakfast, grab an asiago cheese roll, cut it in half from the top. Make some scrambled eggs & put it in the little pouch left over from that delicious cheese. So good.

Stop being so cranky & shove a breadstick in your mouth.

DaveO said...

So a local business becomes a success and this means that this is bad for local business? We should celebrate what La Boulange accomplished.

julia said...

It just leaves fewer choices---as Starbucks comes in with their fiscal trimming. My hummus sandwich which I loved - now has -- no hummus flavor since they are just coating the bread so slightly. bummer. I love having choices in my neighborhood and this merger eliminates that creative possibility that LaBoulange encompassed so deliciously.