Near stunning Qinghai Lake in China's Qinghai province, local herdsmen carefully hand-comb the hairs from the yaks they raise. After processing the fibers, they send them to be turned into yarn, and then onto Shanghai's Chongming Island to be knitted into finished goods. Ten days later, luxurious, high-quality children's clothing and accessories can be seen in some of the most fashionable shops in Paris and New York.

This 30,000-kilometer supply chain that begins at an altitude of 4,000 meters has helped nearly 3,000 herdsmen in the area increase their incomes by 20 percent. Behind this improbable story is Taiwanese lifestyle entrepreneur Carol Chyau.

In 2006, Chyau joined with her business partner Marie So to found an apparel design brand called Shokay built on the soft inner hairs, or "down," of Tibetan yaks. Shokay, appropriately, is the Tibetan word for yak down. In 2008, the company had sales of US$500,000, nearly enough to break even, and sold more than 100 different items in over 10 countries.

Discovering a Hidden Opportunity

Chyau, born in 1982, met So while studying at Harvard University's John F. Kennedy School of Government. The two felt passionate about creating a social enterprise to help the poor.

On a trip to the Himalayas, they worked through the nonprofit China Exploration and Research Society to gain an understanding of how yak down is woven into tough but pliable tents and warm clothing. They figured that if the fibers could be transformed into luxury yarn and exported to North America and Europe, the incomes of local herdsmen could be supplemented.

After returning to the U.S. with the ambition to help the herdsman, they drew up a business plan based on information obtained from Chinese suppliers through the B2B platform Alibaba, including the actual costs of producing down and how long it took for products to get through the supply chain. Because their plan presented clearer financial projections and more concrete and practical approaches than other proposals submitted by their peers, it won first prize in the Social Enterprise Track of the 2006 Harvard Business School Business Plan Contest.

Not knowing a thing about textiles when they started up their venture, the two women flew to New York to consult a top textile expert at the Fashion Institute of Technology. With the professor's help, they gained specialized knowledge about advanced textile production equipment, the combing of hairs and fibers, and other production-related techniques.

In spring of 2007, Chyau decided to jump into the downstream finished goods market by building her own brand. She observed that newly wealthy Chinese people revere brand-name goods, so she positioned her brand as representing luxury with sensitivity. She priced her items at the lower end of the luxury-brand price range, with a blanket, for example, selling for US$800.

To strengthen their products' design, they hired a professional designer and built a team of 30 knitters on Shanghai's Chongming Island. At the same time, Chyau attended all the major fashion shows, including those in London, Paris and New York, to market the products overseas. These efforts culminated in Shokay's products finding their way onto store shelves in Europe, the United States and Japan.

The company also formed an alliance with the herdsmen cooperative of Qinghai Province's Heimahe Township, located on the southwestern edge of Qinghai Lake, which ensured a steady supply of consistent quality down. Some 3,000 herdsmen currently participate in supplying the fibers needed for Shokay garments and accessories.

To further expand her business, Chyau gambled on a brick-and-mortar retail outlet for her luxury items, signing a three-year lease for a shop in Shanghai's old French Concession, which is now the city's leading battleground for trendy boutiques and restaurants. Between 200 and 300 customers flooded the store on the first day it opened.

Socially Innovative Business

In less than two and a half years, Chyau has seemingly performed magic in developing her idea into a business selling more than 100 items in 10 countries with a turnover of US$500,000.

Chyau never believed she needed to make a fortune to help the poor, but also she never felt it necessary to become an ascetic monk. To Chyau, and other entrepreneurs of her generation, the borders defining aesthetics, marketing and social consciousness are blurred, paving the way for socially innovative companies that can even help impoverished Himalayan communities.

Translated from the Chinese by Luke Sabatier

Chinese Version: SHOKAY　青海犛牛毛　進巴黎精品店