A stillborn vape startup dream: Luo Yonghao distances himself from FLOW

On September 17, Luo Yonghao drew a clear line with FLOW through Weibo. For a smart businessman, when the right and wrong of e-cigarettes is rampant, he should avoid digging holes for himself.

But he is still a partner of Ono Technology, and e-cigarettes may depend on the rest of his life. So, a week later, Luo Yonghao quoted a passage from an article in the media entitled "New York University professor: E-cigarettes will save the lives of 7 million smokers in the next ten years", but did not make any comment.

From the rise of brands and sales in the e-cigarette industry, which has led to billions of yuan in financing, to the controversy surrounding diseases, drug abuse, and the promotion of false functions, which has caused global smoking bans to fly, to the imminent national mandatory standards for e-cigarettes... People who are involved in the e-cigarette industry are as thorough as Luo Yonghao: In 2019, although e-cigarettes were a mess, they also reached a critical juncture of life and death.

Faced with the reporter's straightforward question, Lang Xiaolong (pseudonym) did not change his vision. He continued to stare at the coffee whirlpool formed by rapid agitation, and used a spoon to draw ripples in the whirlpool in the reverse direction.

Lang Xiaolong, who has been working in Shenzhen for more than ten years, understands very well that the era of earning a lot of money by relying on a copycat has come to an end. But in the second half of 2018, seeing the rapid proliferation of e-cigarettes brands in China and the continuous entry of capital and hot money, Lang Xiaolong thought again: "Will e-cigarettes become the next 'copycat' in his life..."

Lang Xiaolong graduated from a well-known financial and economic college in China in 1997. Due to the superior family environment, a stable job was not so important to him, even though he was a senior executive at a well-known technology company in China at that time.

In 2004, Lang Xiaolong came to Shenzhen and met Zhou Yunqi, who was working hard in Huaqiangbei, Shenzhen, through an event. The two hit it off and decided to do a copycat mobile phone business in Huaqiangbei.

Lang Xiaolong told reporters, At that time, Two people decided to go to Huaqiangbei rent a counter,"This counter on the one hand used for purchasing party and manufacturer contact, On the other hand used in the market front end to understand demand and rear upstream feedback."

In Huaqiangbei, which was in full swing at that time, renting a counter was not a simple matter."There was no room for consideration at all. The price and rental time were all decided by the other party. The decision was made in a few minutes, or it would be taken away immediately." Seeing this scene, Lang Xiaolong became even more convinced that coming to Shenzhen was the right choice.

The decisive decision lived up to the two young people. Two years later, Lang Xiaolong and Zhou Yunqi gained a lot from "cross-sourcing", so they established their own mobile phone OEM.

Lang Xiaolong recalled that year like a general who had won a battle. The first mobile phone they made became a hit model."The screen is big enough, complete functions, and passable workmanship." In that era when demand exploded, Lang Xiaolong relied solely on the large screen. This breakthrough point has yielded sales of more than 10 million yuan.

In 2008, Lang Xiaolong and Zhou Yunqi were already quite famous in the copycat mobile phone industry in Shenzhen, and exporting mobile phones overseas has become a way to attract money. During the years when he was running the export trade of copycat machines, Lang Xiaolong also became a successful gold digger.

"Is it accurate to describe it as getting rich overnight?" Lang Xiaolong smiled."I can only say that I am very lucky." Based on Lang Xiaolong's experience, 2004 to 2010 should be the most glorious era for Huaqiangbei. Relying on Shenzhen's mature electronic components industry chain and the popularity of foreign mobile phone brands such as Motorola, Nokia, Samsung, Siemens, and Ericsson in China, Shanzhai phones have rapidly emerged with the advantage of high cost performance, and the supply of shanzhai phones exported to Africa, Southeast Asia and other places exceeds demand. In Huaqiang North, which is crowded with gold diggers, sudden wealth overnight is indeed not a myth.

But after no Shenxian Year, with the rise of domestic brand mobile phones such as Xiaomi, OPPO, and Huawei, the domestic and foreign markets of shanzhai phones were constantly being eroded. Until the beginning of 2018, when the myth of shanzhai phones came to its final stage, Lang Xiaolong, With tens of millions of yuan of funds, he quit the company he had established.

In Shenzhen, a city with extremely sensitive winds, there are not a few people like Lang Xiaolong who have fled the copycat industry, but this group of people entered the e-cigarette industry faster, and it took less than half a year to withdraw from the previous project to dig the first bucket of gold in the first half of the e-cigarette industry.

June 2018? The e-cigarette industry revealed that RELX, which was led by source code capital and followed by IDG, announced that it had completed the first round of RMB 38 million in financing. This gave Lang Xiaolong a boost in the arm in his decision to enter e-cigarettes.

At the age of 44, it is the year of war for a man. It is more than enough for Lang Xiaolong to turn to a new outlet and open up a new period of glory in terms of both funds and experience.# p#pagination title #e#

"The manufacturing model in Shenzhen is actually very simple. As long as you want to make a product, you can basically realize it here." Lang Xiaolong told reporters that judging from the development trajectory of MP3s, mobile phones, or current popular smart devices, the routine models are all similar.

The first is to select products and determine the products to be made; the second is to find designs to design the relevant products, appearance, materials, functions to be realized, etc.; then is to take the prepared plan to open the mold; and the last is to find a OEM factory for mass production.

"Are e-cigarettes difficult for these manufacturers?" Lang Xiaolong smiled and replied,"There shouldn't be any product that can defeat Shenzhen."

But after all, when he reaches middle age, despite his obsession with entrepreneurship and starting a new journey, Lang Xiaolong still takes every step more cautiously. This time he chose a friend to plan the e-cigarette project together. The friend he calls is Yang Jianyu (pseudonym), the founder of the Internet operating company.

Lang Xiaolong's reason for inviting Yang Jianyu to start a business together is very simple. On the one hand, there is a division of responsibilities. Lang Xiaolong is responsible for production, and Yang Jianyu is responsible for product promotion and sales. This will reduce a lot of burden than operating upstream and downstream together.

On the other hand, he still has some incomprehensible aspects of e-cigarettes, an industry that is becoming popular too quickly. Therefore, adding another person from the Internet industry who is not in the same industry can increase the perspective of viewing problems and increase the insurance factor of the project during this process.

After receiving Yang Jianyu's support, they began market research on e-cigarettes. Lang Xiaolong was responsible for product selection. He scanned several major domestic e-commerce platforms, selected dozens of categories of e-cigarette products, and studied them one by one.

"What are the main focuses on?" Lang Xiaolong told reporters,"The taste and workmanship." For smokers, the taste must always come first. There is no doubt about this. In addition, nowadays, the buyers of e-cigarettes are mainly young and middle-aged groups, and e-cigarettes are still a fashion for them. "I will hold it in my hand and play with it in various occasions. I must have a good feel, which will increase the workmanship requirements."

Lang Xiaolong told reporters: "The quality of products cannot be too LOW. They must be able to be taken out and used." This is the primary standard that Yang Jianyu has always told him to achieve. In fact, it is really easy to find a manufacturer to produce e-cigarettes in Shenzhen. The cigarette rod is actually an atomizer, and the abrasive tools for cigarette bombs are also available in major foundries. The partner's advice also made Lang Xiaolong understand that user needs have increased with the times, and it is not feasible to make e-cigarettes like making counterfeit machines back then.

However, Lang Xiaolong fell into a bottleneck when looking for satisfactory product samples. Either the cigarette bomb had a dry taste and a strong flavor, or he found an e-cigarette sample made by a foundry to open the mold, which could not meet the ideal comfort requirements.

As Lang Xiaolong continued to make samples, trials, and modifications, the e-cigarette industry entered the fast lane. Brands mushroomed like bamboo shoots, and capital was also crazy about it.

On March 15, 2019, at the annual "March 15" conference, e-cigarettes were named by CCTV: formaldehyde exceeded the standard, was harmful to health, and induced young people to buy. The controversy over e-cigarettes was detonated, and online channels were once removed from the shelves. Electronic cigarettes, and three months later, the national standard on e-cigarettes also gave a deadline for introduction in October.

In August, when typhoons, heavy rains, and scorching sun alternated, Yang Jianyu and Lang Xiaolong, who were not in the same city, met at the airport where they stayed together on business trips. Yang Jianyu said that the policy direction would have a great impact on the e-cigarette industry, and put forward two suggestions: either slow down and wait for policy clarity, or start new project options at the same time.

After Yang Jianyu finished speaking, he hurried to the boarding gate that was about to close. Lang Xiaolong sat in the terminal, staring at the door leading to the takeoff journey that had not yet been opened, and fell into deep thought.

When Lang Xiaolong hesitated on the road to starting an e-cigarette business, those colleagues who had once made a fortune by relying on copycat machines, like him, had quickly dug their first bucket of gold in e-cigarettes.

At a party, Zhang Jiangwei (pseudonym) shared with everyone after three rounds of drinking,"E-cigarettes are now full of treasures." In early 2008, Zhang Jiangwei switched from the copycat industry to e-cigarettes and independently built an e-cigarette bomb OEM. The next foundry he is planning is to produce high-end ceramic atomizer parts for e-cigarettes.

Lang Xiaolong also expressed his views on the sudden take-off of the e-cigarette industry in the interview. Behind the high attention of capital, the biggest push is actually that e-cigarettes have been upgraded from requiring users to add their own cigarette oil to using cigarette bombs. "This change is a milestone for the development of e-cigarettes."

Lang Xiaolong's statement was also confirmed by the reporter in interviews with some e-cigarette users. Wang Dong (pseudonym), who has been smoking for 10 years, told reporters that he started smoking e-cigarettes in 2014. At that time, e-cigarettes were not hot in China. The reason why he bought e-cigarettes was because his girlfriend believed in a certain brand of e-cigarettes. The promotion of e-cigarettes allowed him to use e-cigarettes to achieve the purpose of quitting smoking.# p#pagination title #e#

At that time, there were no cigarettes for e-cigarettes. Wang Dong had to add cigarette oil himself every day. Every time he changed the taste, he had to smoke or throw away the previous ones, otherwise it would smell and be very troublesome.

"It's so convenient to use cigarette bombs now." Wang Dong has also recently used new e-cigarettes, and he smoked them more in social occasions such as friends and colleagues."It feels quite fashionable." However, Wang Dong also complained to reporters that he did not know why every time he smoked e-cigarettes, he would feel dry and his entire respiratory tract would feel uncomfortable.

Because of its convenience and fashion, the eye-catching performance of e-cigarettes in the market also has a solid foundation-users pay the bill, making e-cigarettes whistle in the wind on the tuyere in 2019.

Lang Xiaolong told reporters that the real profit generation of e-cigarettes does not lie in the tobacco rods. Even if manufacturers sell only cigarette rods, they will lose money. The sales of cigarette bombs are the source of profit.

"The profit from a box of cigarettes is usually between 80 and 100 yuan." Lang Xiaolong took a box of versions containing three cigarette bombs as an example. The price tag for a box of cigarettes in a physical store or e-commerce platform is about 100 yuan, and the cost is less than 20 yuan. This cost is mainly due to the shell of the cigarette bombs. Expenses, and tobacco oil accounts for a very small proportion of the cost.

"The main component of tobacco oil is edible glycerin, coupled with some flavors and different proportions of nicotine." Regarding the taste plan of tobacco oil, Lang Xiaolong said that there are no clear regulations and standards in the industry.

Either the purchaser finds a professional tobacco oil preparation company to provide the solution, or the OEM can directly provide the tobacco oil ratio plan based on the taste needed by the purchaser, or even the purchaser itself can DIY the solution."The tobacco oil plan is very simple. Some small brands directly search the Internet and then place orders for production."

The reporter then searched the Internet for the keyword "tobacco oil blending, and indeed found many tobacco oil blending plans. Some even made DIY tutorials to teach the production of tobacco oil step by step with pictures and texts.

"Can tobacco oil be blended so casually?", Lang Xiaolong replied: "There are no relevant standards in this industry yet," so negative news related to e-cigarettes has been exposed one after another, endangering health and using excessive materials.

When Lang Xiaolong was conducting market research, some foundries also recommended to him that in order to taste similar to cigarettes, nicotine could be added or the dose of nicotine increased in the formula, and then there was no need to mark the addition of nicotine in the ingredients or the marked ratio was not the true addition ratio. Therefore, Lang Xiaolong said that "insiders 'speculation about the main content of the national e-cigarette standard is to regulate cigarette oil."

Regarding the qualifications needed for e-cigarette products to be listed, Lang Xiaolong told reporters that big brands will conduct tests on e-cigarette rod equipment quality certification, flavor and fragrance quality certification, and national food safety standards, but most small brands will at most do equipment quality certification., you can go on the market.

For those in the e-cigarette industry and those who are preparing to enter the e-cigarette industry, in the market where there are no industry standards for the time being, the threshold for this business is very low. From production to production to marketing, compared with mature industries It seems too simple, even a little scary.

On September 26, the U.S. Centers for Disease Control and Prevention announced that a total of 805 cases of lung injury related to e-cigarettes have been reported in multiple states across the United States, including 13 deaths.

Just the day before, U.S. e-cigarette giant JUUL issued a statement: Its CEO Kevin? Kevin Burns announced his resignation. And immediately suspend all radio, print and digital advertising in the United States.

Not long ago, the governor of New York State announced an emergency executive order banning the sale of flavored e-cigarettes other than tobacco flavor and menthol flavor in the state. Wal-Mart, one of the world's largest retailers, has also announced that it will stop selling e-cigarettes containing nicotine in the United States.

When San Francisco passed a complete ban on the sale of e-cigarettes in June this year and became the first city in the United States to completely ban the sale of e-cigarettes, Long Xiaolong had a trace of foreboding, but he did not expect the ban and action related to e-cigarettes to come so quickly.

Lang Xiaolong, like all those who pay attention to these news, understands that behind this series of actions, it is actually the U.S. government that has seen the huge harm caused by e-cigarettes. Statistics show that one-fifth of high school students in the United States are smoking non-tobacco-flavored e-cigarettes. Some local media even claim that the abuse of e-cigarettes among teenagers has become a disaster in American society. In addition, the harm to the body caused by smoking e-cigarettes has also been successively confirmed.