Entrepreneurship: Vape Shops Want to Do Good, but Fear F.D.A. Won’t Let Them Do Well


“Before I quit smoking, I was coughing like crazy,” said Mr. D’Angelo, whose mother, a three-pack-a-day smoker, died of emphysema at age 69. Vaping, he said, “really helped me get off cigarettes.”

“Now if I can help someone stop smoking and add five or six years to their life,” he added, “I’ve accomplished something.”

Several public health physicians, asked if vaping is safe, were unanimous: It is safer than smoking tobacco — which involves inhaling tar and 7,000-plus chemicals, 50 of which are carcinogens — but not definitively harm-free.

“The jury’s still out,” said Dr. Michael Fiore, founder and director of the University of Wisconsin Center for Tobacco Research and Intervention, a 25-year-old program.

“One issue has remarkably divided the public health community,” Dr. Fiore said. “Some feel e-cigarettes are a remarkably positive force” for weaning smokers from tobacco use, “and some feel they are a remarkably negative force.”

“The thing pretty much everyone agrees on,” he said, “is that all youth should be protected from any tobacco or nicotine products. There’s lots of data to support that.”

A government report found that 16 percent of high school students said they had used e-cigarettes in 2015, up from 1.5 percent in 2011. Particularly worrisome to the medical community are e-cigarettes marketed in child-friendly flavors like bubble gum and cotton candy.

“E-cigarettes are markedly less dangerous than combustible tobacco, but markedly less dangerous doesn’t mean safe,” Dr. Fiore said.

The products have certainly become widely available. Vape shops have popped up all over the country, in part because the barriers to entry are low. According to the American Vaping Association, there are 10,000 to 15,000 vape shops nationally, employing 50,000 to 100,000 people. The business is profitable, according to the association.

For many vape store owners, it’s not just a business but a mission, a way to help others stop smoking, as they have. Yet the looming F.D.A. deadline has upended the industry and left many business operators frustrated and confused.

Kim Thompson has owned three brick-and-mortar vape shops in Tacoma, Wash., since January 2011, in addition to an online store. Her shops, ranging in size from 700 to 3,000 square feet, were doing well — until the F.D.A. rules came down, she said.

“The industry is not stable,” Ms. Thompson, 47, said. “My employees are very concerned, and some of my best people are looking for new jobs as a result. Even though the regulations haven’t gone into effect, I’m seeing difficulty.”

She predicted — emphatically — that the regulations would put her out of business. “There’s no ifs, ands or buts about it,” Ms. Thompson said. “I’m not sure where I’ll turn next. It’s overwhelming.”

Business is down 40 percent since the 2016 regulations, Ms. Thompson said, and she has had to lay off 15 of her 25 full-time employees.

Like Mr. D’Angelo’s, much of her business is selling equipment to smokers who want to quit and who crave emotional support, advice and guidance as they do.

“You won’t be successful quitting if you don’t have a hands-on experience,” Ms. Thompson said. “They have to learn how to vape, and it’s a different process than smoking.”

Like so many other vaping entrepreneurs, Keith Mautner came to the business after a long career doing something else, in his case importing and exporting wine. A former two-packs-a-day cigarette smoker, he began vaping in 2009.

“This is a very effective way to quit smoking,” he said. “I tried patches and Chantix. Nothing worked.”

Mr. Mautner, 40, began his vaping business in 2011, shipping online only, having created a device with a friend who is a machinist. His sales were $500,000 the first year, he said. In 2016, he opened his first physical store, Empire Mods, in Flushing, Queens. Now he has a second store, with a partner, in Tamarac, Fla.

“The first year was really tough,” he said. “There was much more competition there. Now that we’re better established, we’re doing pretty well.”

Like Ms. Thompson and Mr. D’Angelo, Mr. Mautner knows that vapers form a tight-knit and enthusiastic community. They also crave novelty, spurring constant innovation, he added.

“You have to be on top of things,” he said. “If you’re not two steps ahead, you’re in trouble.”

For vaping supply manufacturers like Nicholas DeNuccio, founder of a three-year-old firm, Propaganda E-Liquid, the business has proved lucrative. Mr. DeNuccio, at 22, already has 25 full-time employees in Irvine, Calif., and has sold more than two million units through 2,000 vape shops in 40 countries. His most popular flavor is Illuminati, a blend of blood orange, pineapple and strawberry. The juices are a mix of 40 percent propylene glycol and 60 percent vegetable glycerin.

The vaping industry, currently worth about $3.5 billion, is projected to grow to $40 billion in annual sales globally, Mr. DeNuccio said. He plans to comply with the F.D.A. regulations, and is bracing to fill out hundreds of the F.D.A.’s required “premarket tobacco applications.”

“It’s really an extensive process, and it’s going to weed out a lot of people who aren’t doing it correctly,” Mr. DeNuccio said.

Even the largest tobacco companies are concerned that August 2018 is too soon to comply with the F.D.A.’s many demands, said Gregory Conley, president of the American Vaping Association. The largest players in the industry — like the Altria Group and the R. J. Reynolds Tobacco Company — also make e-cigarettes.

Bonnie Herzog, an analyst with Wells Fargo who tracks the vaping industry, agreed. “Even Altria have been somewhat public on pushing back on this,” she said. “They’re fighting along with the little guy.”

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