ATLANTA, Ga. — In 1997 entrepreneur Andy Mack and his wife Nancy, a former Walt Disney World Resort customer service manager, opened their first Teavana storefront at Phipps Plaza (Lenox Square Mall).
During the 10 years that followed he changed the name from Elephant Tea Co., perfected the format, acquired prime retail locations in some of the most desirable malls in the country and introduced a remarkable variety of specialty tea blends.
It was always his intent to introduce conventional tea drinkers to specialty tea and the myriad gadgets on display in his stores, he told the Atlanta Journal-Constitution after opening his shop.
Fortune smiled as his business model gained traction. Investors added momentum, doubling the number of stores to more than 50 between 2005 and 2008. By July 2011 he was ringing the bell at the New York Stock Exchange and celebrating a $121 million IPO with a jubilant team. Teavana’s mall locations were earning an enviable $1,000 sq. ft. in retail sales at the time. The following spring Teavana acquired Teaopia, a Canadian-based retailer with an uncannily similar business plan. The company paid a half million each for the 46 Teaopia stores.
Mack received the Ernst & Young Entrepreneur Of The Year® 2012 Award in the Retail and Consumer Products category and by fall the company was earning $43 million a quarter and projecting revenue of $250 million per year.
Store count had risen to 284. Mack announced plans to build 500 stores. Shortly after the most successful specialty tea retailer in America discovered his pot of gold at the end of the rainbow.
In November 2012 Starbucks bought the company for $620 million paying $15.50 per share. The Macks had retained 21.5 million of the company’s shares to earn a payout of approximately $335 million. Starbucks valued the company’s blends at $13 million and the goodwill associated with Teavana, its “Heaven of Tea” slogan and business plan at an astounding $467.3 million. It was the most expensive acquisition in Starbucks Coffee Co. history.
During the past year Mack has assisted with the integration of Teavana which has continued to grow. It now numbers 366 locations including showcase concept stores in New York City and Seattle, Wash.
Last week Annie Young-Scrivner was promoted to executive vice president of Starbucks Coffee Co. and named president of Teavana today replacing Mack who announced his retirement.
“We are grateful for Andy’s leadership establishing Teavana as a world-class leader responsible for bringing premium tea to millions of customers over the past 17 years,” said Cliff Burrows, group president, U.S. Americas and Teavana.
“Under Annie’s leadership, we plan to do for tea what we did for coffee by significantly expanding the availability of new and innovative Teavana products in Starbucks and Teavana retail stores and through other channels,” he said.
Teavana is positively positioned to capture market share within the rapidly-growing $90 billion global hot and iced tea market. Young-Scrivner most recently led Starbucks Canada’s record Fiscal 2013 performance. Prior to her role leading Canada, Young-Scrivner served for three years as Starbucks global chief marketing officer and president of Tazo Tea. Before joining Starbucks in 2009, she had a successful twenty year career at PepsiCo and held positions such as chief marketing officer Quaker Foods and president of greater China for PepsiCo Food & Snacks. Young-Scrivner will continue to report to Burrows in her new role.
See: Teavana update.