On November 10th, Juul released a statement addressing the controversy surrounding whether their products will continue to be sold. However, on the same day, Juul announced that they are laying off 400 employees. Recently, Juul also announced that they have received funding to help maintain their business operations and "continue to advance their administrative appeal against the FDA marketing ban." A spokesperson stated that Juul is undergoing restructuring but did not provide additional details.
The image depicts Juul products on display at a tobacco shop in New York City. Photo credit: Associated Press.
According to insider sources, the new funding comes from two early investors in Juul: Nicholas Pritzker, the head of Hyatt Hotels, and Riaz Valani, a San Francisco private equity specialist.
The new investment is from "old friends".
Nicholas Pritzker and Riaz Valani can be considered "old friends" of Juul. According to a report by PitchBook, Juul raised $112 million in venture capital in 2017 and invited Nicholas Pritzker to join its board of directors. In 2022, he ranked #1096 on Forbes' global billionaire list with a wealth of $2.8 billion. Riaz Valani was also an early investor in Juul and served on the board for a long time, becoming one of the company's largest shareholders.
For Juul, the support of "old friends" has been a much-needed boost. According to a report by The Wall Street Journal, since last year, Juul has agreed to pay over $525 million in settlements with dozens of states investigating or suing the company. There are also pending cases, including lawsuits from nine other attorneys general. In early October of this year, Juul Labs Inc. CEO KC Crosthwaite announced that the company is canceling its overseas expansion plans, refinancing some of its debt, and fighting for survival.
The growth of Vuse and the decline of Juul are both gradually slowing down, with the gap between the two narrowing in terms of speed of increase or decrease.
As a former leader in the e-cigarette industry, Juul is facing increasing market pressure due to its ongoing struggles with the FDA. Competing e-cigarette brands are seizing the opportunity to capture the market share that Juul is being forced to relinquish. Among these brands, Vuse, owned by British American Tobacco, has shown the strongest momentum.
According to a report from Nielsen Convenience Store in October, Vuse holds a 12% higher market share than Juul. In September, Vuse surpassed Juul with an 11.6% lead. 2FIRSTS compiled a table based on Nielsen's publicly available data from convenience stores for four consecutive months, which shows a gradual widening of the market share gap between Vuse and Juul. However, the growth of Vuse and the decline of Juul are both slowing down, and the rate of increase in the difference between the two is also slowing down.
2FIRSTS compiled the information from publicly available sources.
The Nielsen convenience store data for Juul and Vuse for this month has yet to be released. Although Juul has announced their exit from bankruptcy protection, giving them a glimmer of hope, they are still faced with the challenge of regaining lost market share. How will Juul make a comeback and reclaim their position? 2FIRSTS will continue to report on the latest developments regarding Juul.
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