Stella Yu isn’t a name that instantly rings a bell for most cyclists, but her role in the cycling industry far outweighs her recognition outside of it. Everyday riders might think of the company she heads and founded, Velo Saddles, as a fringe brand that peddles value-oriented seating options, but that’s by design. Behind the scenes, Yu’s company is a veritable gargantuan in the industry. Chances are extremely good that you’re already riding a Velo product without even knowing it.
The 800-pound gorilla
No matter how you slice the numbers, Velo Saddles is an empire within the cycling industry. Founded with modest ambitions in 1979, Velo today boasts annual revenues of over US$70m, employs over 2,000 people between its four facilities in Taiwan and China, and produces more than 15 million saddles per year — enough to outfit every adult-sized bicycle sold annually in the United States and Australia combined.
Few of those saddles will actually bear the Velo brand name, however. By Yu’s estimates, Velo manufactures under contract roughly 80% of all enthusiast-level saddles sold worldwide — mostly for OEM labels, but also most of the aftermarket labels currently on the market. Velo doesn’t openly disclose its client list itself, nor do the majority of those clients want known who manufactures its wares.
That said, it’s not exactly a secret which well-known brands tap into Velo’s expertise. If you ride a Specialized, Bontrager, WTB, Ergon, or Selle San Marco saddle — and that’s just to name a few — you’re riding a saddle that almost certainly went through a Velo production line. In fact, the Prologo brand was wholly launched a decade ago as an open collaboration with the Taiwanese company.
As if Velo’s dominance in saddles wasn’t already enough, the company also enjoys an increasingly strong position in handlebar tape and grips, with over six million sets produced last year.
“Sometimes a consumer can buy five different brands,” Yu told CyclingTips during the recent Taipei Cycle Show, “but they’re all made by Velo.”
How did one company become such a prominent figure amongst an industry filled with dozens of different bicycle brands, all desperately vying for a bigger piece of the pie? Yu credits the success with a simple idea that came to her more than three decades ago — one inspired by, of all things, the automotive industry.
“If, for example, you are Giant, but I see your tires are Maxxis, your fork is Fox, your saddle is Selle Italia — Giant is only that small layer,” Yu said. “My car is Mercedes-Benz. Thirty-two years ago, I started thinking: Mercedes-Benz is only one logo. I pay for Mercedes-Benz, not Maxxis tire, or whatever. So I started to suggest to customers to use their own brand. You are Giant so you need to have everything ‘Giant’ on your bike. So I made saddles with a Giant logo.”
It wasn’t long before other companies followed suit. In hindsight, this was a logical path to take. Today, it’s commonplace for bikes to be littered with house-brand components.
“You need exclusive production,” Yu said. “You need to have your own exclusive product line. Now, all the most important brands have their own exclusive brands. That idea was from me. This is the Velo strategy.”
The secret to success
Many companies have found initial success in a great idea. Far fewer have been able to maintain that level of prosperity over the long haul. Velo may be an economic powerhouse, but you’d hardly know it after meeting Yu in person. A diminutive 68-year-old woman, she doesn’t exactly fit the mould of someone who wields as much influence as she does. Remarkably courteous and humble, Yu credits the ascendency of Velo to two simple principles that don’t always make sense in the short-term, but oftentimes pan out over time — excellent customer service, and earned trust.
“Before Velo, I worked three and a half years for a bicycle manufacturer,” she said. “I worked for a trading company for eleven years after that. So I service the customer. I know what the customer is looking for, how we can help them be successful. It’s easy — if you take care of them, they stay. If everyone stays, then of course you have more opportunity. It’s so simple. It’s not difficult to do.”
More difficult is keeping everyone’s trade secrets separate. After all, many of Velo’s clients are fierce competitors who would of course love to know what’s happening on the other side of the fence. As easy as it would be to let that information freely circulate, Yu insists that doing so would actually cripple her business.
“Of course, if everybody is similar, they’re unhappy. We have one salesperson and one R&D person for every account. They’re not allowed to talk with other [employees] on other accounts. Inside, sales and R&D are separate. If there are three top companies, there are three separate R&D teams. We have 28 engineers, so one customer gets one salesperson and two engineers. Even inside the manufacturing line, sometimes we separate [them], too. If someone tries to copy from another customer, I would suggest, ‘don’t do that’. So that’s why all of my customers are different. If everybody is similar, there is no value to having separate items.
A third critical piece of the equation, however, is good old-fashioned hard work. After founding the company 37 years ago — and building it into a veritable empire — you’d think that Yu is perhaps starting to look at the next phase of her life. Ask her about the thought of retirement, however, and you’d get an entirely different answer. Even today, she’s at work every day by 8am and leaves at 6pm, and still handles every new client herself.
“I’m ok. I have passion to work,” she said. “Honestly, if I have nothing to do, I sleep around 8pm and wake up at 3am. That is my happy time every morning, from 3 to 6. That three hours, I clean my mind. At 5:30 or 6, I ride my bicycle. After 8, [it’s] so many people. I am usually done by 6. The most important time is 3-6am. I am happy to work. No problem.
“I am like a watch,” she continued. “I have been working from fourteen years old. My style is very crazy hard work, even when I was a child. I helped my mother from when I was seven years old. If I’m not sleeping, I’m working. Now I’m getting old, but I’m so proud of my life. I’m very healthy. I never think I will retire because I don’t know what I would do. I like to work. I make sure I relax, I make sure I sleep enough, that’s ok. I never think about retiring. This is the Chinese style. It’s difficult for people to understand. Even my father, 90 years old, still helped me at work. My mother, 90 years old, still helped me at work. They don’t understand why they need to retire because they’re still useful. I’ll work until I cannot.”
More than a handful of industry veterans have described Yu as the most powerful woman in the bike business — and in more ways than one, that’s perhaps true. Yu isn’t having it, though.
“You mean me?” she says with a puzzled look. “I’m just happy. It’s just hard work; I’m not really that strong. It’s very simple. Just hard work, thinking about your customer, taking care of your friends. So simple. That’s the Taiwan woman style. Plus, I’ve worked in the bicycle industry for 52 years. Everybody knows me. And if somebody trusts you, it’s easier to work with you. I’m not smarter than anybody else.”