Everyone at Pax Labs is vaping. Puffs of white clouds rise every few seconds, from seemingly every desk on the second floor of this unassuming building in San Francisco’s Mission district. As the haze clears, the office comes into focus: bustling, cramped, and messy. The eight-year-old company is growing quickly, and the space is too small. It’s also one floor below the offices of Burning Man, which, judging from the loud thumps coming through the ceiling every few minutes, exists in a perpetual state of Burning Man-ness.
Inside a glass-walled conference room, Pax Labs CEO James Monsees leans back in his chair and tells the story of the company’s newest product, Juul. It’s an e-cigarette system, with a pocket-size vaporizer and nicotine juice cartridges you swap in and out.
It’s not a stretch for a company known for cannabis vaporizers, but its arrival in the e-cig market signals a major shift. Once known as Ploom—the name is still on its doors and business cards—the company made two beloved vaporizers, the Pax and Pax 2. Both showed strong design savvy, which lead some to call it “the Apple of vaping.” But it recently sold the Ploom brand name and some of its intellectual property to Japanese tobacco conglomerate JTI in order to escape their corporate partnership. Now it’s known as Pax Labs.
With a new name comes a new product, Juul. The $50 e-cig is aimed at nothing less than leveling-up the market with a delicious, beautiful, safe, and just flat-out better product. It comes at a pivotal moment for the industry, which is exploding in popularity even as its health concerns and advertising regulations are hotly debated. Whatever the future, though, Pax is betting on Juul.
The underlying vaporization technology is valuable, and can be really disruptive in a lot of different markets. Pax Labs CEO James Monsees
So far, even as they’ve become mainstream, e-cigs have come in one of two packages. They’re either small and round, designed to look and feel as much as possible like a cigarette, or they’re huge, assembled from many parts, and spectacularly complicated. Even the best of them look like you’re smoking from an oboe.
The Juul is nothing like that.
It’s a long, thin, slightly rounded rectangle. It’s mostly battery, I’m told, save for a slot at the top where you pop in a tiny pack of nicotine-infused “juice,” which Pax will sell in color-coded flavors. You don’t clean it, and there’s no work involved: just put it in your mouth and inhale. The juice comes in four absurdly-named flavors—tabaac, fruut, miint, bruulé—and costs $16 for a four-pack of cartridges (a cartridge is roughly equivalent to a pack of smokes).
Pax is trying to build something different. The team searches for the right analogy: It’s like a Nespresso machine, if a Nespresso machine still made great coffee. No, it’s like a gun. Wait, Monsees cuts in, it’s not like a gun. Please don’t make that comparison. What’s a thing where you make it easier and better all at once?
Not to get all cliché about it, but here’s the analogy: Pax is trying to make the iPhone of e-cigs.
It purposely doesn’t look or feel like a cigarette. Pax wants the Juul to be an evolution of the cigarette, not a technologically advanced approximation of it. Plus, Monsees argues, what makes a cigarette enticing isn’t the burning paper and nasty smell. It’s something more ineffable. “It’s just objectively cool,” says Ari Atkins, an R&D engineer at Pax. “How do you make somebody look cooler? Give them a cigarette.” That’s why Pax paid so much attention to the gray-and-black design, which looks far sleeker and better than your average gigantic multi-piece vape. You do look a little like you plugged a USB stick into your mouth when you use it, but it’s undeniably cooler than that insipid mess of tubes and glowsticks you’re probably using now.
Smoking is also all about rituals, which Monsees calls “the fidget factor.” Rolling your own, if you’re into that, or banging the pack against your palm if you’re not. The first smoke of the day, the last smoke of the day. Just lighting the damn thing. The Juul offers a few tics of its own: tap the side of the device twice, and the LED light on the front blinks an indication of your remaining battery. It charges in a tiny dock that slips into any USB slot, and there’s something wonderfully satisfying about dropping it into the magnetic charger. (Magnets!) If you wave the Juul around, it lights up in a rainbow of colors.
That last one is completely pointless. But it’s fun.
A Different Draw
Monsees isn’t puffing on a Juul as he discusses its origins—though several of the half-dozen people at the table are—but he has a long history with e-cigarettes. Years ago, he convinced his brother to go to Hong Kong to buy and ship him the first e-cig on the market. “It was like this giant box you had to buy, because you couldn’t buy cartridges for it ever again. So you’d buy this kit that cost like 300 bucks, this huge thing.” It was terrible. “It didn’t produce any vapor. The flavor was terrible, it was only one flavor and it was this horrible tobacco-type flavor.”
Since then, e-cigs have become both popular and plentiful. Forget shipping from Hong Kong; you can buy one for six bucks at the convenience store. “If you came in to buy a pack of cigarettes,” Monsees says, “which is going to cost you 6 to 12 dollars or something, and there’s this thing on the counter that’s the same but costs less, why would you not try that?” Usage and awareness of e-cigs have been climbing for years, and at least among teens they’ve even become more popular than actual cigarettes.
Since there’s very little protective intellectual property and very little regulation, anyone and everyone can get in the e-cig market. “All you have to do is have a phone call to one of the six manufacturers or so in China that are producing these e-cigarettes,” Monsees says. “And oh, I want it to be an orange tip on the end and say Orange on the packaging. It’s an hour-long conversation, maybe, and a couple weeks to receive delivery, and you’re in the e-cig business.”
There’s one catch, though: they almost all suck. “One, they don’t deliver a lot of vapor. Two, they’re really awkward to use and kind of cheaply made. Three, they just don’t deliver nicotine in the same way the cigarette does.” Everyone’s working with essentially the same idea, the same product. As with Big Tobacco a few decades ago, the war is won and lost in the marketing.
A Salty Solution
Pax hopes it can overcome marketing muscle with quality; the only way to stand the test of time, and survive whatever regulation is coming, is to simply build something great. Pax starts with technology: they call themselves a playground for innovation, and talk often about “modernizing” smoking. This tiny company believes it can design the product better, build the heating mechanism better, and make every aspect of the smoking and vaping experience better.
Pax LabsEven Pax’s nicotine is supposedly better than everyone else’s. Atkins tries to explain: “In the tobacco plant, there are these organic acids that naturally occur. And they help stabilize the nicotine in such a way that makes it …” He pauses. “I’ve got to choose the words carefully here: Appropriate for inhalation.”
Steve Christensen, a design engineer, pipes in. “Smoother,” he says. Atkins goes with that. “Yeah, it’s smoother.” Most e-cig manufacturers, he explains, are dissolving raw nicotine into their juices, “and they were not getting the full picture that they needed.” You won’t find raw nicotine in nature, he says; it’s mixed in with organic acids and other substances. It’s this cocktail that makes nicotine palatable. “We figured out how to incorporate some of these organic acids into the juice,” Atkins says, “so we were able to get a very cigarette-like experience.”
It sounds obvious, really: If you want to make something as smooth as a cigarette, make it more like a cigarette. Pax believes these
“nicotine salts” are part of the trick to a great-tasting e-cig, to solving the burnt and harsh tastes too many competitors offer. None of the crew seems to know why no one else has figured this out, though, only that they haven’t. “The people who understood the science and were listed on previous patents from tobacco companies aren’t at those companies anymore,” Monsees says. “If you go to Altria’s R&D facility, it’s empty.” Some of those people are now on Pax’s team of advisers, helping develop Juul.
Long-term, though, the Juul’s careful way of vaporizing that nicotine is its real secret sauce. The temperature of the heating coil is controlled to give you the largest possible cloud of vapor, but none of the dangerous chemicals or compounds, like formaldehyde, that come with overheating the coil or the juice. This is Pax’s product, maybe even more than the Juul itself. “The underlying technology, the vaporization technology, is so valuable and can be really disruptive in a lot of different markets,” Monsees says. He declines to say more, but the implications are clear: Vaporization is an excellent way to consume everything from weed to cancer-fighting drugs, and being able to exactly control delivery could be hugely powerful.
A Tricky Sell
Let’s assume Pax has made the best e-cig on the planet, and that it can convince people that the Juul is worth paying for. It’s still facing huge obstacles that have nothing to do with the quality of its product. E-cigarettes have until now lived outside of the tobacco industry’s stringent regulation, but that’s going to change quickly, especially as the big tobacco companies continue to take over and consolidate the market. And until then, those companies are free to spend millions marketing their products, and Monsees freely admits Pax can’t compete with sexy Blu spreads in the Sports Illustrated swimsuit issue, or NJOY’s yearly Super Bowl ad.
The broader debate, about e-cigs’ safety, will have even bigger implications for Pax and its many competitors. Some celebrate the fast growth of e-cigs, saying they’re leading people to stop smoking more harmful products; there’s a fairly clear correlation in recent data between the uptick in e-cigs among teens and the downturn in tobacco smoking. Others point to similar correlations between e-cigs and asthma, lung inflammation, or MSRA. Still others say e-cigs are a gateway drug into cigarettes, and that they may have long-term effects we don’t yet understand. The only certainty seems to be that no one yet knows for sure.
Monsees neatly avoids taking a stand. He can’t take one, really, because making health claims—even the “it’s not the worst thing!” counterfactual—will invoke the wrath of the FDA. But he also says Pax doesn’t need to worry about the morality of it all. “People are going to do what they want to do.” Their job, as in any market, is to give people a better way to do it. “We want to do the right thing, but we can’t be the mouths of what the right thing is.”
Yet he almost can’t help but point out a line in a New York Times article that was broadly negative on the prospects of e-cigs. It quotes David B. Abrams, the executive director of the Schroeder Institute for Tobacco Research and Policy Studies. “They’re not a gateway in, and they might be accelerating the gateway out,” he tells the Times.
“In the end,” Monsees says, “if regulators determine that these are safer products, how is that not a great thing? And why is that headline not ‘Hey, finally there’s alternatives, there’s movement in this industry after 150 years, maybe in the right direction.’ Seems like a good headline to me.”
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