Cultivating coffee culture

Dutch Bros shop in Oregon City Jason Kaplan Dutch Bros shop in Oregon City

Dutch Bros CEO discusses his strategy behind a new private-equity investment.


In October Dutch Bros, the country’s largest privately held drive-thru coffee company, announced plans to open 800 shops in five years with the help of a private-equity investment from TSG Consumer Partners. The investment (financial terms were undisclosed) gives the investor a minority stake in the Grants Pass company.

It is the second time TSG has invested in an Oregon coffee company. In 2011 it bought a stake in Portland’s Stumptown Coffee Roasters. The firm sold the business to Peet’s Coffee & Tea in 2015.

Travis Boersma, CEO of Dutch Bros Coffee, talked to Oregon Business about how TSG’s investment in his company is different from Stumptown’s. Boersma says he will maintain control of the company he founded in 1992 with his late brother Dane. He is in it “for the long haul,” he says, and is not planning a similar exit strategy as the Stumptown deal.

This interview is edited for length and clarity.

How will the capital investment change your business model?

We will have more intellectual capital thanks to TSG’s relationship with Bain & Company. They are TSG’s thought partners in how we navigate the road ahead. The financial capital they have infused will be helpful with our growth. I see nothing but value-add for the vision we have had for many years and the culture that differentiates us in the marketplace.

Travis Boersma 300x300Travis Boersma, CEO of Dutch Bros Coffee

How will you use the investment to take advantage of new technologies?

We are looking at how technology can enhance our customer experience and our speed — whether this is online ordering or a customer-facing app. I could see in the next 10 years a situation where a customer could pull into a Dutch Bros, be greeted with a big smile and everything happens without them having to take payment out of their wallet. That is entirely possible. That is one of our quests: We want to have a frictionless experience at Dutch Bros.

Will a robot eventually be greeting customers?

We are in the people business. I have zero interest in artificial intelligence. We take pride in learning names, knowing drinks, having them ready when you pull up. That good old-fashioned customer service is a staple for us, with new-school ways to make it happen.

How will your corporate culture change?

Our culture will not change. It is people and community first. I will never compromise our culture as long as I am captain of the ship.     

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Private equity has a reputation for being cutthroat by wringing profits out of companies they have invested in.

We are non-typical. We are growing and thriving with culture and operations; in these areas we are strong and healthy. Oftentimes, corporations that aren’t so healthy take on a private-equity investment to unwind and take chips off the table. We are in for the long haul.

Our vision of what drives the company is providing opportunities for people in the organization. So we don’t sell franchises. We grow with people who have a clear understanding of the culture and how to cultivate it, how to develop leaders and people and operational knowhow. That is our differentiator for the market.

The coffee business is highly competitive, and the chain-restaurant sector has had declining sales over the past few years. How do you plan to compete and grow given these market conditions?

We have never really looked at others in the trade as much as we look at ourselves. We focus on knowing our customers and knowing what they want. We make sure we are staying true to our identity.


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Describe the thinking behind the Dutch Bros location on the corner of Northwest 20th Avenue and Burnside in Portland. It has a very different aesthetic from other Dutch Bros outlets. It has a bicycle drive-thru, for example.

Burnside location

That particular model, we will do only in select locations where there is a lot of pedestrian traffic. We will do it in areas where drive-thrus are restricted — we will put in a walk-in shop. But they are few and far between. That particular shop is close to the Portland Timbers stadium; we have a partnership with the Timbers, so it was a way to provide an outlet where we think Dutch should have a presence.

Statistics show that millennials are driving less than previous generations. How can you adapt to this trend with drive-thrus as your main business model?

We have walk-ups at our shops too. That is really the focal point for us. But at the end of the day, what people prefer is what we want to deliver.



How do you see the coffee business evolving in 10 years’ time?

Who would have thought cold brew would have been what it is today, or the blended-coffee sector? There are people who are really seeking the perfect cup and are purists. I love that. I can certainly delve into that world. What we do is we keep in a very simplistic space. Our base for all of our coffee beverages is espresso. Ultimately, you have a ton of versatility to go from that one base. Over time, it will be interesting to see what the market does. But people will always crave good-quality coffee.


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Kim Moore

Kim Moore is the editor for Oregon Business magazine.

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