Tully’s opened its first store in Kent, Washington, in 1992. The founder of Tully’s Coffee, Tom Tully O’Keefe, planned to rival the quickly expanding Starbucks coffee. Tully’s quickly developed into a strong regional specialty-coffee retailer. In 2006, Tully’s Coffee made its first net profit. But more recently, the president and CEO has described Tully’s focus as no longer on competing against the mega giant Starbucks, but on serving fine hand crafted coffee (and expanding into the Wholesale market).

It now operates nearly 100 stores in the Greater Puget Sound area of Washington, San Francisco, Los Angeles, and Southern Idaho, more recently Arizona, and licenses its brand for use in South Korea and Japan. It has also opened several stores in Stockholm. Tully’s sold the most profitable unit of the company-its Japan partnership-for $17.9 million in September, 2005. Also in 2004 Tully’s entered into an agreement with Northwest University (located in Kirkland, Washington) to open a coffee shop on campus which would be run by the student body. To this day it remains quite busy serving the 1100 to 1200 student and staff population at Northwest. It used to be that you had to travel to one of their storefronts to enjoy their premium brews, but now you can even by their beans and brew coffee in your own cappuccino maker.