Homegrown coffee brand Philz has gone corporate, and its CEO may have miscalculated with a new policy change aimed at not alienating bigots or the religious right, or something.
A rumor was circulating this week, via a petition from Philz employees, that Philz Coffee stores were being told to take down any Pride flags or decor in store locations, in the name of greater "inclusivity."
As KRON4 reported Wednesday, an unnamed San Francisco Philz store manager confirmed that Philz CEO Mahesh Sadarangani, speaking to employees at a recent summit, suggested that store decor should be reconsidered, at managers' discretion, to make sure all customers feel "included."
Sadarangani confirms today to the Chronicle that Philz corporate is "working toward creating a more consistent, inclusive experience across all our stores, including removing a variety of flags and other decor." But we all know this is all about one flag that is triggering for Trump voters.
Sadarangani gave another statement, published by ABC 7, in which he said, "At Philz, we have always believed everyone who walks through our doors deserves to feel welcome and safe, and that belief is at the core of everything we do... This is a change in how our stores look, not in who we are."
The policy appears not to have been fully enacted yet, as Pride flags remained up on Thursday morning at a downtown store and at the 549 Castro Street location, per the Chronicle.
It remains unclear what may have spurred the change, at this company that was born in San Francisco's Mission District in 2003, founded by Palestinian-born Phil Jaber and his son, Jacob Jaber.
Philz, which was acquired by private equity firm Freeman Spogli & Co in August 2025, has 75 locations spread mostly across California, with six in Chicago.
As the employee petition says, the flags hanging in stores "hold deep meaning and value to both staff and visitors, symbolizing that these locations are safe and welcoming spaces for all individuals, regardless of sexual orientation or gender identity."
The petition, which has nearly 2,500 signatures as of this writing, is seeking to have the policy change reversed, saying the Philz should "reaffirm its commitment to diversity and inclusion, aligning its values with the community it serves."
The Castro Street location of Philz not only features a rainbow flag, but occasional rainbow bunting, a rainbow table runner, an imitation of the rainbow crosswalk at Castro and 18th painted on the floor used to show customers where to line up, and a portrait of LGBTQ civil rights icon Harvey Milk on the wall.
Reactions to the apparent policy change around Pride flags has been swift, with one Castro customer, Todd Varney, telling ABC 7, "It's pretty rotten." But, Varney adds, "if it's owned by big money at the top, I can't say that I'm surprised."
One commenter on the news on Instagram writes, "The Castro location better be DEAD."
The uproar over this Pride flag policy is reminiscent of another that occurred three years ago, after Sadarangani took over as CEO. Five employees at a Berkeley Philz location were sent home, without warning, after wearing "Free Palestine" pins to work, as the Daily Cal reported. The employees were reportedly told to remove the pins for "safety reasons," the irony being that the company was founded by a Palestinian family.
Stay tuned for more backlash, and a formal boycott of Philz.
