Starbucks is to partner with investment company Sequoia Capital to invest in new technologies which will accelerate the company’s digital innovation in Mainland China.
The two companies plan to focus on next-generation food and retail technology companies whose products will help Starbucks grow the coffee and retail industry in China, one of its fastest-growing markets globally.
An early focus will be opportunities to embed digital technologies across Starbucks’ retail business, making the most of data-driven analytics, modelling and decision making.
“These may entail adopting creative solutions to enhance front- and back-of-house operations, such as the use of machine learning and predictive intelligence tools in managing Starbucks growing retail operations in China, or the optimisation of Starbucks supply chain through precise, real-time inventory management,” the company said in a statement.
“China’s vibrant environment is a rich ground for entrepreneurship that has seen the emergence of many local innovators that we hugely admire,” said Starbucks China CEO and chairman Belinda Wong.
“The partnership enables Starbucks to tap into the most dynamic Chinese technology entrepreneurs in order to delight our customers with meaningful innovations created in China, for China.”
By partnering with Sequoia Capital, Starbucks will gain early access to technologies which it expects will create investment opportunities to grow its China business and keep pace with technology innovations which are driving structural reform across digital, online and brick-and-mortar retailing.
“Beyond the direct benefits from this collaboration, Starbucks also hopes to leverage its retail expertise, scale and infrastructure to help realize the growth aspirations of like-minded purpose-driven companies that have a passion for leading positive change for customers and communities,” said Wong.
“The partnership presents an exciting platform for our portfolio companies to test, commercialise and scale new innovations for China,” added Neil Shen, steward of Sequoia Capital, and the founding and managing partner of Sequoia Capital China. “Together with Starbucks, we look forward to bringing the digital transformation of the consumer retail industry in China to the next level.”
This is not Starbucks’ first commitment to identifying and funding new technologies. Last year it launched Siren Ventures in the US to invest in new concepts and technologies.
“We are excited to tap the tremendous energy of technology entrepreneurs from two of the world’s largest and most dynamic markets, to pioneer innovative solutions that could reimagine the global retail landscape,” said Kevin Johnson, president and CEO of Starbucks.