Adam Brotman, the top Internet guy at Starbucks, is in the spotlight after his company unveiled a big deal to take Square in its 7,000 U.S. coffee shops and invest in the San Francisco-based payments startup.Brotman reports directly to CEO Howard Schultz, who is joining Square’s board.
We caught up with Brotman by phone while he was in a taxicab in New York City rushing from one meeting to the next.
We learned that Starbucks is “doubling down” on its prepaid card and associated mobile app; that the company has been gearing up its infrastructure for more tech partnerships; and that Starbucks is continuing a big in-house development effort, now with Square’s assistance.
Here’s what you need to know about Brotman:
- He’s a rising star at Starbucks. Originally hired in 2009, he started as a VP, added a general manager and expanded his role in early 2011, moved to a senior vice president position later that year, and got promoted to chief digital officer in March.
- He spearheaded Starbucks’s innovative iPhone app. You can already pay with your phone in a Starbucks—and that’s an initiative Brotman oversaw.
- He runs everything digital at Starbucks. That includes the Starbucks Card and its associated loyalty program; social media and digital marketing; and in-store connectivity and entertainment, including Starbucks Wi-Fi and the Starbucks Digital Network partnership with Yahoo.
- He’s an entrepreneur, just like his new business partner, Square CEO Jack Dorsey. In 1996, Brotman started PlayNetwork, a Seattle-area company, which provides in-store music and other entertainment to a bunch of retailers—including, yes, Starbucks. He left PlayNetwork in 2006 to join Corbis, the stock-photo company backed by Microsoft cofounder Bill Gates.
Here’s what we learned about the Square-Starbucks deal:
- Starbucks is keeping its Starbucks Card and mobile app. Together, the prepaid card and mobile version account for an estimated quarter of U.S. sales. But Starbucks didn’t have a great mobile solution for customers who still wanted to pay with their own credit or debit card. The Square partnership is really for them. Over time, though the Starbucks loyalty program and Square’s similar offerings will get more integrated, and Starbucks will encourage consumers to download Pay With Square, Brotman says.
- Starbucks has an internal API, or application programming interface—and Square will be one of the first outside companies to use it. Last fall, Brotman revealed the existence of this API at a conference in San Francisco, but that didn’t make many waves. But among tech companies, having an API—a documented way of integrating outside pieces of software into your internal systems—is seen as a key to fast, innovative product development. Square is not the only company that will tap into it. “We still have ambitions to have a public API and have a number of folks integrated in our system,” Brotman says.
- Starbucks is not outsourcing its mobile or digital development efforts to Square. If anything, Starbucks will now be doing more tech work to take advantage of Square’s capabilities. The Square partnership will let Starbucks focus its innovation on things like mobile ordering and saving lists of favourite drinks. “We can leverage the fact that they have amazing developers,” Brotman said.
Here’s what Brotman thinks of Square and its CEO, Jack Dorsey:
- Design at Square extends to everything, not just products. “I’m so impressed by how Square is designing the company,” Brotman says. “They’re designing [it through] the talent they brought in. They’re architecting it.”
- Brotman had an intuitive sense that Square and Dorsey were the right partners. “As an entrepreneur, there’s a certain sixth sense about things. You can vector out that they’re going to build something great. It makes it more exciting and gives more confidence about getting involved in that partnership.”
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