Photo credit: Starbucks

Coffee chain Starbucks has announced that its Chinese arm has teamed up with venture capital firm Sequoia Capital China to make strategic co-investments in Chinese companies and also secure partnerships with food and retail startups. Starbucks dubs the partnership as one that enables “early access to ideas in the retail marketplace” and opens up “opportunities for strategic investment to evolve Starbucks business in China.”

A Starbucks-Sequoia tie-up is apparently the latest move by Starbucks to boost the digital aspect of its business in China as it faces competition from newer incumbents such as Luckin Coffee. Such a partnership is bound to secure investment spots for Starbucks in food and retail startups that Sequoia Capital China scouts for investments. Co-investing along with Sequoia will likely guarantee early access to the technologies and services that such startups develop to Starbucks. Partnerships to help boost Starbucks’ digital business are also bound to come about this way.

“Starbucks has an insatiable appetite for innovative ideas that augment the Starbucks Experience and keep it at the forefront of China’s retail landscape,” Starbucks China CEO Belinda Wong 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. 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.”