October 2014

Vapor Hub Takes Stock of Vaping Industry


It all began with a man and his mom, selling a mod in 2008, becoming a retail store in 2012, to now a company that has grown to the first and currently only publicly traded vaping company on the stock market. Back in 2008, Kyle Winther decided to sell “old” electronic cigarettes, but the one constant in the vaping industry is that it’s a rapidly changing industry. Therefore Winther realized that he and his mom weren’t ahead of the trend and started losing sales.

The duo began selling eGo kits and e-liquids and then before they knew it, consumers drifted to mods.

“We ramped it up, and in 2012 we opened our first retail store (Vapor Hub),” Winther said. “But, we said that we had to make our own device. I noticed that the buttons (on other mods) would malfunction and people would lose the spring. They spend all that money and then one drop or button malfunction and they couldn’t use it anymore.”

Winther developed an octagonal button, and at the time he said that there weren’t any mods being made in the United States, so his innovation really took off. Trying to continuously stay ahead of the curve, Winther constantly is looking for more ways to innovate with devices and to stay ahead of the industry change curve.

 


“We saw everything come from the Philippines and it was so basic. We wanted some uniqueness, so we started to do colors,” he said. “We’re one of the very first people in the industry that introduced colors and a design pattern to the mod. Now you see colors everywhere. We changed the way mods looked.”

Current favorites of Winther’s include the AR Mod and the newly released AR Cannon, made out of aluminum, which he vapes daily.

“We wanted something completely different. We wanted something really industrial and really strong, and when we went to make the 26650 it was way too heavy, so we went with the aluminum. It feels good and solid,” he said.

Vapor Hub also develops its own e-liquid, and feels ready for impending FDA regulations, due to the company’s pharmaceutical grade lab.

“We hope it (regulations) happens. We know what they are kind of looking for and the approach they are going to take. The FDA can see that it’s not being made in someone’s back office,” Winther said.

Since they are used to being the first in several categories, Vapor Hub is used to dealing with copycats in the industry. But, that doesn’t mean that it’s something the company enjoys dealing with.

“We put six months of blood, sweat and tears in R&D and someone comes in and sells your idea. It’s not cheap to manufacture in the United States and we’re paying a premium to make sure it gets built right,” Winther said. “It’s not a cheap product, and there’s a lot of time that goes into it—and then someone else comes in and steals from us and our workers.”

http://vapor-hub.com/


Vapor Hub patents and trademarks everything to protect intellectual property, however the first order of business is to go to individual shops with a cease and desist order. In most cases, the shops don’t even know that what they are selling is a knockoff.

“We try to take the friendly approach. We don’t want to sue anybody. We’re just trying to create awareness that some counterfeit products are out there and cheaply made and we want to distribute our actual product. People actually have tried to return something to us that is defective that someone has pawned off as a real product,” Winther said.

Another way Vapor Hub marks itself as a legitimate company is by making the leap to being publicly traded.


“We have been very successful in selling strictly online, and then in 2012 we opened our first retail shop. In order to grow we needed more money, more capital infusion, and we had investors looking at us,” Winther said.


“There was no publicly traded company that would stand behind its product. Some of these smaller shops are not as reputable and it’s discerning for people. We like to have validity behind our name. We want people to know that we are legit.”

In becoming publicly traded, a lot of back and forth negotiation had to happen, which was a time consuming process. Now Vapor Hub participates in quarterly audits, keeping up with shareholders and writing press releases. While all time consuming items, Winther said that in the end it’s all worth it.

“We want to be the market leader and basically be that backing name like Coca-Cola or Pepsi and be that worldwide distributor,” he said. “As soon as you think of vaping we want you to think of Vapor Hub. We want to be able to supply every vape store in the world with high quality product and be that worldwide name brand.”