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Juul has not responded to Crunchbase News inquiries regarding its China launch since Monday. One media source reports that the company is spending nearly $100 million on brand building and marketing efforts within the region.
The international expansion comes in the wake of domestic turmoil. On Wednesday, the Trump administration announced that it will ban the sale of most flavored e-cigarettes, according to many sources. The ban, partially inspired after a slew of mysterious deaths from vaping-related illnesses, could affect a company like Juul which sells a variety of pod — the cartridge that goes inside of a vape — flavors, including mango and Crème Brûlée.
Flavored e-cigarettes were banned in San Francisco earlier this year.
India, anticipating a similar expansion effort from Juul, is also looking at a crackdown. New Delhi is drafting a proposal that could make the production of e-cigarettes warrant a “jail term up to three years,” reports the Times of India.
Juul’s expansion into China makes sense for several reasons. First, China has the world’s biggest population of smokers – roughly 350 million people. Second, many manufacturing facilities are located in China. Third, China’s been known to sell counterfeit pods (example, here). This expansion and availability could, and would ideally, fight the problem of fake pods.
Juul’s definitely not the first company taking a swing at the market opportunity for e-cigarettes in China. In fact, Xing Chenyue, a former Juul chemist that helped create the first product, spun out her own e-cigarette startup as a smoking alternative: MystLabs. Its 20-person team is half based in San Francisco, and half based in Shenzhen, reports TechCrunch. This in mind, Juul is backed by billions in venture capital funding, so competitors may struggle to beat it due to sheer size.
Earlier this month, Juul raised over $780 million in debt financing.
Illustration Credit: Li-Anne Dias
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