After Philz Coffee stripped former employees of any stock earnings when it was sold to a private equity company for $145 million, costing some workers tens of thousands of dollars, baristas will on Friday receive their “thank you” bonuses: $525.
The bonuses will be paid by “Philz Coffee, supported by Freeman Spogli,” the private equity firm that bought the company, according to a press release. They will only cover current workers, not the 10 former employees who had their stock canceled by the deal.
“I personally visited nearly 40 percent of our stores since the acquisition was announced and the thank you bonus of $525 for each barista was well received and appreciated by all of our team members,” wrote CEO Mahesh Sadarangani in a statement to Mission Local on Aug. 13. “I heard from team members that they’ll do things like make an extra student loan payment, buy something special for themselves or make an extra car payment.”
Sadarangani was initially set to receive a pay-out from the deal and put some of the proceeds back into the coffee chain. After Mission Local reported his proceeds, the company announced he would reinvest all of them back into Philz. It is unclear how much he or other executives will receive in the deal.
The $525 bonus for workers is pre-tax and applies to all current baristas. Store managers will get more, several employees confirmed. Employees at the corporate office and roasting plant will also receive bonuses based on rank. The company declined to give specifics in response to an inquiry about what the range of these “thank you bonuses” would be.
But several baristas that Mission Local spoke to were uncertain about the amount they would get for the bonus or said they had yet to receive that information.
“We’d rather be given hard-earned raises than three tanks of gas,” one barista said in response to the bonuses.
Philz Coffee currently has 1,445 employees across its corporate offices, roasting plant, and 79 stores, including 987 baristas. That means its payout for baristas alone will total $518,175.
The company previously said that no employees will be laid off and none of its stores will close as a result of the deal. “It is expected that benefits, pay, raises, hours, and promotions will continue as the company has operated historically,” the press release says.
Mission Local last month broke the story about Philz Coffee’s $145 million acquisition by Freeman Spogli & Co.
I would prefer if the end of the article said something like, “Assuming the executives were paid out around 50% of the purchase price, that only left the execs with a measly $72 million to divide amongst themselves. How will they ever survive?”
This is just sickening. Enough news for today.
Fuck that.
Disgusting.
Surely you’re talking about stock options here, not actual purchased stock.
> I heard from team members that they’ll do things like make an extra student loan payment, … or make an extra car payment.
Oof, that hurt to read. How bleak.
Swindling workers who invested in the company. Shameful greed.
expanded too fast and sucked the employees. Kinda like Peets.
CEO Mahesh Sadarangan said” bonus of $525 for each barista was well received and appreciated by all of our team members, …make an extra student loan payment, buy something special for themselves or make an extra car payment”. REALLY? you can’t even buy a green salad for 525$ in SF..Lessons learned here: when a company like this ask you to buy shares in the company, you know what to do:run.
Another example of corporate greed and forgetting where you came from and who got you there. I honestly hope that everyone who reads this article NEVER steps foot in another Philz again..
How embarrassing.
Ok I’m done with Philz coffee.
They didn’t have to do it, so there’s that. But when talking baristas and barons, it’s hard not to think of the disparity. Freeman Spogli is a $6b fund, meaning the push alone is worth $120m a year. The fund founders can make that half million in literally days. A barista making $20/hr and a hedge fund manager making $20k/hr equals fucked up world.
The firm probably wanted Sandragani to put it all in because that way he has more skin in the game. And whatever he pulled out, he would’ve had to pay capital gains on. Now he can just take out a loan for the Ferrari and save money.
https://aum13f.com/firm/freeman-spogli-management-co-lp
Is it any wonder people are starting to really HATE CEO CULTURE?
“I heard from team members that they’ll do things like make an extra student loan payment, buy something special for themselves or make an extra car payment.”
CEO’s are bad people, exhibit A.
I had stock in First Republic bank. When it was taken over by Chase, that stock became worthless…. Equities are never guaranteed. They are speculative!
This is a different than speculating on stock shares in the open market.
This is employees BUILDING up a company and once they’ve done the work and supported their employer by buying company stock their employer screws them.
Thanks Phil and Jacob.
Philz Coffee baristas to get $525 as ‘ ~thank~ fuck you’ payments. There, fixed the title for you 🙂