Starbucks is strategically revamping its approach to the Chinese market, entering a joint venture with Boyu Capital, a leading alternative investment firm with deep roots in Asia. The agreement will see Boyu Capital acquire a 60% stake in Starbucks' retail operations in China with a USD 4 billion investment. Starbucks will retain a 40% stake and continue to own the Starbucks brand and intellectual property.

This partnership aims to accelerate Starbucks' growth in China by combining Starbucks' global expertise in coffee, branding, and company culture with Boyu's local consumer insights. The deal is expected to be finalized in the second quarter of Starbucks’ 2026 fiscal year.

Starbucks' decision to form a joint venture with Boyu Capital comes as the company faces increasing competition from local brands like Luckin Coffee and seeks to expand its presence in smaller Chinese cities. Starbucks estimates the total value of its China business exceeds $13 billion, including proceeds from the sale, the value of the remaining stake, and future royalties.

The new joint venture will manage the existing 8,000 Starbucks coffeehouses in China, with ambitious plans to expand to over 20,000 locations in the coming years. Starbucks will maintain control of its non-retail assets, such as the Kunshan Coffee Innovation Park and the Yunnan Farmer Support Center. The headquarters of Starbucks China will remain in Shanghai.

Molly Liu, executive vice president and CEO of Starbucks China, stated that the partnership with Boyu will enable Starbucks China to fully unlock the vast market opportunity. Together, the companies aim to deliver exceptional coffee experiences to more Chinese consumers, create greater career opportunities, and drive the future of the specialty coffee industry in China. Alex Wong of Boyu Capital highlighted Starbucks' strong foothold in China and the firm's goal to drive further innovation.

The synergy between Starbucks and Boyu is expected to enhance the customer experience through improvements in beverage innovation, digital service platforms, and adaptation to local culture. The partnership reflects Starbucks' commitment to leveraging local expertise while expanding its footprint in one of the world's most dynamic consumer markets. This move signals how international brands are adjusting strategies to thrive in China amid evolving consumer tastes and complex market dynamics.