YouSaid · the spoken record

Lauren Etter

lines on the record: 90
first: 2021-06-29
most recent: 2021-06-29
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Can buy my book anywhere on your local bookstore would be the best option. You can buy it on Amazon. You can buy it anywhere books are sold. Thank you so much. It was great talking to you.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“You should understand the product that you're selling and not try to make it also something that's different. Jewel was selling a highly addictive product and they treated it like an iPhone or a watch or some other gadget. I think that they should have recognized what they were selling instead of trying to make it to be something that it isn't. I mean, it's both of those things, but I think that they should have had a higher level of care. And I think that businesses probably could benefit from that. But in the long run, I think that they realize that that's not the way that you grow fast. So I think that there's a very big tension between those. And I understand that. But I do think that Jewel would have bought itself longevity had it not just crushed the market like it did.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Think it's pretty clear to me that the biggest business lesson is you need to know who your customers are and you need to be responsible. I mean, it almost sounds cliche, but like you can't go out of the gate, you know, like a bull in a China shop. Like you have to approach the market responsibly and anticipate regulatory questions if you want to have a long-term viability. Now, certainly people would argue that that's not the way to go no Silicon Valley entrepreneur or investor would get behind a company that was moving slowly, that was asking the FDA for permission. But I think in this instance, especially when you're selling a highly addictive product, there just needed to be a higher level of care given to that particular product.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“In courtrooms across the country is whether or not they intended to market to kids. I mean, maybe they just intended to create a great product, just like Steve Jobs, you know, or maybe they intended to just, you know, do the best that they could. And I think that Adam and James did, actually. I think they just surrounded themselves with the wrong people. I think they made an error in judgment when they brought on Richard Mumby and when they brought on other people whose sole goal was to make the product cool. I think that that was the wrong marketing strategy for them. And I think it backfired on them in a huge way.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Right. I think, I mean, I really do think that if they had been focused on the adult smoker market, that they should have and probably would have chosen a different marketing campaign. I think that is clear. So whether or not the marketing campaign is the reason for the catastrophe that followed with, you know, the kids using it, I think it's kind of undeniable. Of course, if you're going to show up at a rave and there's going to be like a jewel, you know a jewel container, you know, like pop-up store there, like they were absolutely designing it to be cool. I think that there was another way that they could have done it that would have involved less flashy marketing and that would have been tailored toward adult smokers, which they claimed that it was. So I do think that the marketing played a role in it for sure. And now whether or not there was the intent there, I think that's like a pretty big remaining question that is going to be litigated.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Yeah. I mean, I think certainly the design and form factor of the product made it successful in addition to the nicotine solution. But I think one thing that we haven't really talked about is that not only did they use the nicotine salts, but they had the highest amount of nicotine on the market. At the time, it was 5% nicotine. Well, it still is. But no other e-cigarette on the market had 5%. It was a huge amount of nicotine. So I think it's like you can't really separate them out. It's like, could they have made an ugly device that was, you know, cloistered, you know, somehow or that was like not marketed and just put in a little box behind a CVS counter that looked like some sort of inhaler or something, which would have been like more of a medical device. I don't know.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“I've struggled with this one forever. If you make a product that 40 year olds think are cool, it is likely that 20 year olds will think it's cool. And that the real win of the jewel was the nicotine salts. So there were lots of vapes at that time. They all had different kinds of designs and maybe they weren't designed by Yves Behar or whoever, but... Reason the jewel won was because the product was more effective at delivering nicotine if an uglier product had been effective at delivering nicotine, it might well have won, right? And that's like to me that I can't unpack that in my brain, right? Like, yep, they did an Instagram campaign, but really at the end.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“By the way, these were advertising tactics that the tobacco industry was literally banned from engaging in. I mean, they hired people who knew nothing about tobacco to do their marketing and who knew the most about how to make a brand pop, how to make a product be super desirable.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Nicotine. There was no mention that this was an addictive product. It was just suddenly this cool thing that you had to have in your hip pocket or in your whatever, in your hand if you wanted to be like a trendsetter. So I do believe that that was their original sin. You know, that was their biggest problem that they created for themselves and that could have been entirely avoided. However, it also launched their product in a huge way. You know, I think Juli likes to distance themselves from the vaporized campaign and say, oh, the vaporized campaign didn't really work. And it wasn't until later that the product took off. But there is no doubt that the vaporized campaign gave it this kind of original cachet and that, you know, launched it onto, well, Times Square billboards that launched it into magazines and”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Absolutely. I think that is and was their biggest misstep. I think had they treated the product with the requisite care that an addictive product should have, then they would have been better off. Instead, they hired a marketing staff whose sole focus was making this product as flashy and attractive as possible. They treated it as a gadget, as the next generation, you know iPhone and that it was a fashion accessory. They gave it to models on runways at like the New York Fashion Show. So literally it was a fashion accessory and they treated it like that. And, you know, the way that they, the early ads essentially had pictures of these young, beautiful people using the jewel. There was no mention of”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Is the problem that it was just too cool? It's such a weird aspect of this controversy that one of the things that set Jewel on the path of destruction was that it was perceived as cool, which is what every business person wants their product to be perceived as is like the heart of the problem. They hired the wrong marketing guy and they chased cool instead of, I don't know, being perceived as medicine or a back brace or something that would just never be as cool.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Lot of the focus of the controversy, a lot of focus in your book is that Jules marketing to teenagers, to influencers, to social media created the crisis for itself, that they had an initial marketing plan and they hired a flashier marketing guy. And he was like, we're going all in, New York City cool, billboards with models, the whole deal. And that created the problem. Actually went to the jewel launch party that you describe in a warehouse full of influencers and beautiful people taking selfies. And the whole thing was literally full of jewel vape. It was an incredible party. And I walked out with a jewel. And then I was like immediately addicted to a jewel. It was great. I hope my mom doesn't listen to this. Since quit.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Tobacco 2.0. They're using the same tactics. They're buying health journals and they're engaging in those same types of tactics.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Line and sinker. I mean, there have been some issues recently where there was a public health journal where Jewel essentially paid for the entire journal and there was a series of studies in it and there's all these disclaimers saying that these were people who worked at Jewel, scientists at Jewel, consultants who were hired by Jewel, literally the entire journal was articles written by people paid for or employed by Jewel and it caused a huge kind of controversy in the public health community and among researchers and scientists who are saying, well, this is essentially happening again. Now, Jewel will say that, you know, these were legitimate studies that they did that, you know, deserve to be in this public health journal. But to me, what I found most fascinating is just the reaction to that. We're immediately people like jumped on that and said, this is exactly like”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, and I think that the way that the tobacco industry just obfuscated and lied and covered up scientific research and at the same time paid scientists to generate studies that would support their conclusion, one of the reporters back in the 1990s called it the largest misinformation campaign in American business history. There was an extraordinary amount of lying and deceit by these tobacco companies. And I do think that that's causing a huge challenge for Jewel right now. One, because anything they put out is going to be immediately doubted as just being, you know, another kind of study that's been bought and paid for by the tobacco industry that's making it very hard for the company to come up with any sort of credible science that people are actually going to, you know, take”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Reading a book looking at the history of the research and how it's politicized, it seems like the cigarette companies just created a lot of noise in the research, right? They paid for a lot of studies. They said we can never really know this stuff. It feels like there are echoes of it now where you can pick a study and it says what you want it to say. Is that a strategy that Jewel is using now? Is that a strategy you see other companies using? It seems like that the tobacco wars as you called them became the focal point for what we can actually twist science to say whatever we want it to say or at least create confusion.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Think there's going to be lawsuits all around. It would look terrible for the FDA to single-handedly put an American company out of business, which is essentially what would happen if they don't grant this regulatory authorization. And at the same time, they would be removing from the market the exact type of product that the FDA is in a way endorsing or facilitating when they say that we're going to take nicotine levels down and we want Americans to use a less harmful alternative. So it's a very complicated, controversial issue that has so many different facets to it that there's absolutely all kinds of political pressure and lobbying going on right now.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, absolutely. This is one of the most politicized products in the world. I mean, you have the tobacco industry right now as we speak going to great lengths to try to influence the FDA to re-educate Americans about nicotine. Altria has told the FDA that they believe that some of the funding that they've been using on anti-vaping campaigns should also be used on teaching Americans that nicotine is an unhealthy. And of course, you have the anti-vaping people, the youth tobacco prevention people who they want to see less of these products on the market because they continue to pose a threat to youth. So it's the FDA is under a huge amount of pressure right now.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“That market forward with maybe greater velocity, seeing just how much money can be made and seeing how popular it is, that type of thing. But certainly as the FDA moves forward in reducing nicotine levels and cigarettes, that market is only going to continue to grow. I think that the industry is transforming from the tobacco industry to the nicotine industry. And so I think we're going to see a lot of innovation in the nicotine industry. There's going to be more nicotine products.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“I think there's this realization that this is a huge market. The market for nicotine products is like $800 billion globally. I mean, it's a massive market. And that includes like lozenges, patches, all of that, including e-cigarettes and stuff like that. But it's a huge market. And I think that people, this gets back to what we were talking about, the socio kind of cultural question about like nicotine use in America. I think businesses realize that this is a market that is not going away. Even if people aren't getting nicotine from their cigarettes, they're going to continue looking for nicotine in other places, whether it's through Jewel, whether it's through a lozenge, whether it's through a patch, you know, all of that. I think that we're going to be a nation of nicotine users and nicotine addicts. And I don't see that changing anytime soon. And I think businesses have recognized that there's an opportunity. Certainly the advent of Jewel thrust.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Authorizes Jewel to continue to be marketed, it could actually position Jewel to be like the product that smokers turn to because they no longer have their nicotine in the cigarettes and they're searching for something else. I mean, sure, there are other products on the market that compete with Jewel, but I think a lot of people agree that Jewel remains the most popular. And it's one of the most effective kind of nicotine delivery mechanisms out there on the market. So it's just fascinating to me that the FDA in sort of carrying forward with this nicotine reduction plan could actually potentially be kind of setting up Jewel for a resurgence, another life, act two, however you want to say that.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“And that's to enable them to transition off of the non addictive cigarettes. So if there's a category of people that they can't get the nicotine from their cigarettes, but they still very much want it, that the FDA would like to have sort of a suite of products available to the public that will give them their nicotine fix without being as deadly as a cigarette. So this has been an issue that Mitch Zeller, who's the head of the Center for Tobacco Products, has been working on for decades. He's written all kinds of articles and studies about it, literally dating back to the 1990s. And this whole idea of this harm reduction plan that you can just provide people with a less harmful alternative to cigarettes, then you could save a lot of lives. And it's very much like what Adam and James talked about, the jewel co-founders early on. If the FDA approves Jewel or”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Going to reduce nicotine if it all goes through, but this is a plan that the FDA has and it's going to go through the regulatory process. It's going to take years. But the plan is that they're going to reduce nicotine in combustible cigarettes to non-addictive levels. The idea being that, again, if there's no nicotine or minimally addictive amounts of nicotine in cigarettes, people aren't going to use them. So they can essentially get rid of the cigarette. That's the FDA's strategy is to get rid of smoking. As part of that strategy, they want to be able to provide a clean nicotine alternative for cigarette smokers.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“It's actually fascinating. The FDA is essentially trying to carry out this long-term plan that began under Scott Gottlieb, but that had actually been talked about for decades, which is the end game. They call it the tobacco endgame. What that means is the FDA has decided that there's a huge potential public health benefit in getting people off smoking cigarettes onto potentially less harmful products like jewel. It's so strange because the FDA had been going after Jewel for so long and, you know, there'd been this whole explosion of the youth issue and how that just kind of subsumed the agency. And now, as they talk about this plan where they're”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, and that's the most amazing thing about this deal. The fact that Altria paid that amount of money is just reckless, in my opinion. It's like everybody knew the company was coming under this regulatory scrutiny that they had this lung issue that they had been entangled in, that they, you know, that they had been fingered as the single largest contributor to the youth epidemic. I mean, there were so many risks in investing in this company, but it was almost a byproduct of just sheer momentum and desperation that ended up in this 12.8 billion dollar payout. Altria basically had its backup against the wall. Joel had them over a barrel. They were so desperate to basically have this product that they could sell that would, you know, actually give them a foothold in the e-cigarette market that they paid this huge sum of money. I think it was a terrible deal. I think everybody agrees it was a terrible deal, except for”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Nick Pritzker, the Hyatt Billionaire, he made $1.7 billion. Bowen and Monseis each got about $650 million apiece. It was highly unusual. Oftentimes when you bring in that type of investment or that type of capital, you'll use it either to pay down debt or to go to your company's operations. This was just a chunk of money that it was just divided up among them and they got that. So almost none of it went back into the company. In fact, none of it went back into the company. So yeah, there was a sweet deal for Jewel.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Yes, it was a highly unusual deal. So essentially the $12.8 billion that Altria paid for its stake was structured as a special dividend. What that meant was that none of the existing shareholders had to sell their stock. They essentially just got a check for $12.8 billion. Some of that was distributed to employees, a billion dollars in bonuses paid out to employees depending on their 10 year. Some of them got hundreds of thousands of dollars just as a special bonus. Others got more than a million dollars. Of course, the largest beneficiaries of that deal were the board members and the founders. So the single largest shareholder at the time, Riaz Valani, he made around $2.6 billion just like a windfall.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Structure of the deal is really strange, right? A lot of jewel employees just got huge amounts of cash and walked, which is not usually how these kinds of deals work. You get stock, you have a vesting period. There's all this stuff that makes you stay after an acquisition, but it feels like a lot of jewel employees and investors got huge checks and bounced.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“At innovation, our product was the worst, and we sucked. And so we had to basically take the product off the market. It's kind of a complicated issue. Like I said, the FTC will decide and the deal could be unwound. And that would be something for sure.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Right. The idea is that Altria could have competed in the market, that they had intended to compete, and had there been another large player with deep pockets in the market like Altria, they could have fostered a more competitive market. They claim that there was a quid pro quo, that Altria took its Mark X off the market in order to do the deal with Jewel. And that was anti-competitive. That resulted in monopolistic behavior. So, of course, Altria is arguing exactly what you're saying right now. They are currently, before the FTC, all of their executives are being interviewed. They're testifying. And that's exactly their argument that this was a product that was so bad. It had no future. It was the shittiest product on the market. I mean, it's a hilarious argument to for a big tobacco company to be making. Essentially, like we were terrible.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Doesn't that kind of make no sense though? You have a crap product. You know you're not going to succeed. The nicotine salts are patented. You can't go after them. Shut it down to buy the small company that makes a good product. That's just Business 101. Like, what is the actual collusion there?”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Was this announcement that Altria had purchased a 35% stake in the biggest pod product on the market that had been seen as the biggest contributor to the youth usage issue? Scott Gottley was furious. The FDA felt like this was entirely duplicitous and was basically just said that they were playing the FDA like a fiddle. So that all happened. Then months later, the FTC sued to unwind the deal between Autria and Jewel. They alleged that it was anti-competitive because Altria took its Mark 10 product off the market and essentially colluded in order to gain a larger market share. So literally the trial is going on.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“And how concerned we are for public health. We don't want kids using these pod products. So we're going to be responsible and we're going to remove Mark 10 from the market. That's what they told Scott Gottlieb. Well, less than a month later,”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Negotiations over a very long period of time starting in 2017, and there was all this back and forth. Altria initially wanted to just buy Jewel outright. And Jewel immediately was like, we have no interest in selling outright. We want to retain control of the company. And so there are all these negotiations going back and forth and they ultimately decided to invest $12.8 billion into Jewel for a 35% share at the time when the company was valued at $38 billion. I should point out this entire transaction, the Federal Trade Commission has sued, what happened was Altria weeks before the deal was announced in December 2018, they just took Mark 10 off the market, their elite product. They told the FDA, we're so concerned about the youth usage issue that we want to be a team player. We want to show you how responsible we are.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Jewel. It was ugly. It didn't have the form factor. It didn't have the Silicon Valley Jeanne Sequois. And people didn't really like it. But Altria tried like flooding the market with that product. You know, they would figure out where's Jewel doing really well in sales? Let's go there and just like cut the price of their product to have this like price war. And they really did put up a fight for a while. And they realized that there was no hope, essentially. Mark 10 Elite was a terrible product. Everybody knew it. It was almost like an internal joke where they were just like, this is pathetic that we're trying to compete with Jewel when they have like 60, 70.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“So in this kind of bout of desperation, when Altria is realizing that Jewel is an actual threat, they actually start scouring the globe for products that they could just simply buy that had been on the market prior to August of 2016 and put them on the market. They ended up finding this Chinese manufacturer that had this product that they could prove had been on the market prior to 2016. So they did introduce this, what they deemed to be their competitor to Jewel, which was Mark 10 Elite. It looked kind of similar to Jewel. It had like the battery and had the little pods. This was Altra's very first pod product. And they didn't introduce it until like 2000, I'm forgetting the date right now. I think it might have been 2018. But the problem with that product is that it was absolutely terrible. It didn't have the nicotine salts like.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“So, the FTA has a steaming rule at the same time, all trade knows that maybe it could kill Jewel by going after the regulators. It seems like the cigarette companies wanted to be seen as the responsible adults, even though they sell cigarettes and they wanted to cast the tech companies, the vape companies, as being reckless upstarts. At some point that Trump administration gets involved, the whole thing becomes very politicized and Altra ends up making this gigantic investment in Jewel. How did that all come about?”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Crazy product that's just eating our market share, they couldn't do anything about it. They could not introduce a new product to the market.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Plan before Jewel came around was that their harm reduction play was going to be in smokeless tobacco and snooze. Like that's what they were thinking. They were thinking of going in the direction of this like, you know, people are going to use nicotine, but they're going to do it in a pouch. And so when Jewel hit the market, they were just kind of already behind the ball, even though they had done decades and decades of research. And by the time they realized it was actually a threat to them, The FDA had implemented this rule, the deeming rule in August of 2016. And all the companies were forbidden from putting any new product on the market. So literally, Altria, they dragged their feet for so long, kind of underestimated the trajectory of the market. And by the time that they realized, oh, shit, Jewel is actually like this, you know.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Like figuring out what is this thing, like it looks like no other product on the market. We've never seen anything like this before. And they honestly debated for so long whether or not it was going to be a threat to their product and to their industry. And they had different management before Howard Willard took over and ended up doing the deal with Jewel. But at the time, the management was very circumspect about the long-term viability of the e-cigarette market. They thought that regulators were not going to tolerate another nicotine product on the market without going through lots and lots of regulatory hurdles. They believed that this market would not last for long and that they didn't really need to, you know, pour tons and tons of money into it in order to innovate. They already had sort of gone down that road, but a little bit reluctantly like Altria had put their kind of future.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Was a question I just kept asking over and over again, how could Altria have been so behind or so clueless? Why did exactly your question? I would ask that. And the answer is sort of multifaceted. Altria was number one. They were late to the game. When they introduced their very first e-cigarette product, they call them the sigalikes. It was one of those that looked like a cigarette and it had e-liquid inside, but it was really trying to approximate a cigarette. It was cylindrical. It was wrapped even in like this paper material. It was white. It had a glowing tip. So when you sucked on it, it looked like a cigarette. That was the first product that they put on the market. That was around like 2013, 2014. Then Jewel hits a market in 2015. And yeah, they start doing the teardowns of Jewel just like they do with any other product.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“While that's all happening, Austria is freaking out that Jewel exists, that it's going to steal their market share and destroy their business. They're paying a lot of attention to Jewel, and they're the ones who find the change before the government finds the change. Why didn't they just copy the jewel? When I think about big tech companies now, they're just relentlessly clone their smaller competitors all of the time. Why didn't Altria as its looking at the jewel so closely? They're buying them. They realize that they've made this change. They've already effectively reversed engineered it to understand what's going on. Why didn't they just copy the jewel?”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“On the motherboard, they changed some of the way that the product actually worked. They put a new sensor inside of it that would withstand leakage better, that wouldn't cause it to brick, that type of thing. I thought that was a really interesting moment for Jewel because the tobacco companies might not have done that, even though they face the same risk. And in fact, there was a very heated debate inside Altria because they had a similar kind of leaking issue. And they debated for a long time whether or not it would rise to a modification and be in breach of the FDA's rules.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“I think this is a moment where Jewel really embodied the sort of Silicon Valley ideal of move fast and break things, ask for forgiveness, not permission. They actually ended up changing their device. There's a lot of argument around whether or not the change that they made to the device rose to the technical definition of a modification and whether or not that was a breach of the FDA's rule. But the fact of the matter is that they did modify their device after this, what they called the deeming date of August 8th, 2016 at a time when you were not supposed to do it. But Jewel was at this moment where they were like, if we don't fix this, we're screwed and we're going to just get crushed by competitors. But if we do fix it, the FDA will probably never know and they'll never ask us about it. And it was a tiny enough modification. They changed the structure of the pod a little bit.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Couldn't figure out for the life of them why the pods were leaking, how to solve for that issue. They would take the pods on airplanes and over mountain passes in order to figure out was it the altitude that was causing them to leak? Was there some other design glitch in the manufacturing process that was causing them to leak? But it was a huge problem that they had to solve for internally. The problem for Jewel was at the time the FDA was cracking down on the industry. And they came out with this law that said”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“So essentially their technology, it's a battery, has a little heating element in it. The battery actually heats the pod. You insert the pod. And when you suck on it, it triggers the battery to heat up and create the vapor. There's also some electronics inside. And what they found early on, what most e-cigarette companies found was that the liquid contained in the pod, the nicotine liquid, would leak down into the guts of the jewel device. It was a really pernicious problem. When you're a startup and you're scrappy and you're trying to gain market share, having these kind of glitches in the functioning of your technologies, very, very problematic. What Jules set out to do was to fix the problem. It wasn't an easy fix for a variety of reasons.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“It's a big debate on our team over whether they're a tech company. And I think for us, what qualifies something as a tech company is whether you have the margins of a tech company, right? Whether you make a piece of software and sell it over and over again. Jewel has a very mechanical product. They have to manufacture the liquid in the pods. They have to manufacture the pods. And they had a lot of, oh, crap, we make a hardware product with liquid in it problems along the way. And that ran right into some very strange regulatory moments that you kind of unpack in the book. I'm curious if you can tell that story and kind of help me understand how they got through it.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Think Jewel is a tech company as much as they would like to now distance themselves from that. I mean, they sell hardware, their software involved, they innovated. I do think that Jewel is a tech company. They brought to bear the use of technology in order to innovate on a product that had zero technology in it. They disrupted, they raised venture capital. I do think they're a tech company.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Is Jewel a tech company? It seemed like a threshold question for us, right? We're a tech and science website. We realized we wanted to cover it. And we were like, well, it's a tech company. They act like a tech company. They talk like a tech company. Now, many years hence, we realize, oh, a bunch of those companies were not actually tech companies. We work was not a tech company. Was Jewel a tech company?”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT
“Back with Lauren Focus on nicotine is what enabled Jewel to succeed a company that thought of itself as a tech company, as a disruptive company, those very heady days of 2015 when tech companies were going to disrupt everything. And they saw a big lumbering industry. They said they don't even understand their own product. They don't even understand what they're selling. We can make it sharper and better with a focus on design, with a focus on delivery, innovation, all the buzzwords.”
2021-06-29 · Decoder with Nilay Patel · Juul and the business of addiction, with Lauren Etter · IDENTIFIED FROM THE TRANSCRIPT