E-cigarettes are big business, and China is the market with enormous potential. With most e-cigarette start-ups, either being founded in China or catering to its large consumer base, a small start-up named AIRSCREAM has taken the road less travelled by. They have deliberately refrained from putting resources into this market.
Today we sit down with the CEO of AIRSCREAM, Sam O to find out more about their peculiar business choices, AIRSCREAM’s origin story, and the future of the vaping industry.
Who is AIRSCREAM?
Depends on who you ask.
To an outsider, it can be another e-cigarette start-up that opened its doors in July 2018. We are among the few that persisted.
To our customers, AIRSCREAM is the push they needed to start their journey to quit smoking.
To our team, it is a start-up that is promising, stable enough to be independent, but still resource-poor, so they must stretch their imagination and solve problems creatively.
To the founders, it is a dream to eliminate cigarettes. AIRSCREAM is a means to that end.
And to our competitors, AIRSCREAM is a brand that has succeed mysteriously to be the leading brand in a few of the markets that we are available now.
Why AIRSCREAM? Is it the cigarette companies who are screaming?
We are not that big yet to make them scream. We are an independent and resource-poor start-up. But we have our fingers crossed for the future.
As for the name, it is derived from our core mission. We provide our customers with an alternative to smoking that really works. We make e- cigarettes more affordable for our customers. We are their solution to the nagging smoking pangs they get. When they regain control of their life, we want to see them excited and scream with joy.
So, that’s who’s screaming.
Why did you pick the vaping business? What attracted you to it?
I have been a part of the vaping business before AIRSCREAM. I have served as the Commercial Director with a leading European Vape Company. During my corporate stint, the gap between customer needs and market offerings was evident to me. It was quite frustrating to know the problems and not being able to fix them when you know how to. I conceived the idea for an international vaping brand then.
It materialized when I met my co-founder and Chief Branding Officer, Mr. Yeoh KS. As a serial entrepreneur, he identified what was going on, pushed me to leave the job, and incubated the idea. And AIRSCREAM was born in July 2018.
Since then we have curated a team of ambitious professionals with 10+ years of experience across the vaping and FMCG sectors.
What makes you push to produce a better product?
Since 2018, AIRSCREAM has been pushing for a design that resonates with the customer. Our goal is simple – create a vape that trumps the cigarette
experience. Our goals drive us, and the journey so far has been encouraging too.
In 2018, there was a swarm of vape start-ups with special focus on closed system pods (CSV). We were a part of it. To make a mark, we had to move quickly with whatever resources we had. We did and commercialized AirsPops 1.0 in January 2019. We got a lot of good publicity from the 2019 Middle East Vape Show in Bahrain where we were awarded “Best Closed System Pods” among a lot of good competitors.
The next push came in December of 2019 when we got our permit to sell across the EU. By November 2019 we opened a distribution centre for EU in Bristol, UK. So, 15 months from launch, AirsPops 1.0 is available across 50+ markets. It could have grown bigger, but lockdowns were effective in most countries due to COVID19 since early 2020.
The biggest push of them all was the trust our customers placed in us. In the very first year, AIRSCREAM sold $10 million worth of products to consumers looking to vape instead of smoke. They now have a product in their pocket that is not raiding it and helping them get off smoking. Seeing your dream taking shape is the most significant push of them all. And we are prepared to take the future head-on.
Even after so many accolades, why do you call yourself an underdog?
The numbers might look big, but when you do away with the costs of the kind of product we make and the small team manage it all, we are still not out of the deep end.
We are not a VC-funded start-ups. While staying independent allows us to retain control, it does create a lot of financial restraints as well. We just do not have the same access to funding as our rivals who are either based out of China or serve the Chinese market. Laan based in Shenzen is promoted by former WeChat employees, Beijing-based Yooz has been founded by the media entrepreneur, Cai Yuedong, and then there is RELX that has recently secured $75 million funding from Yuri Milner and Sequoia China.
AIRSCREAM is UK-based and runs on our private funds. We also receive small investments from our suppliers who are intrigued by our product concepts in lieu of minority ownership in AIRSCREAM. But that is not in the tone of millions.
Our direct competitors are tobacco companies with big pockets and well-funded vape start-ups. So, securing store shelves, FMCG channels, and marketing spaces is always a challenge. We have to rely on independent stores, online listings, and our other partners who trust our brand. And trust- building takes time.
Team size is another factor. We are not a conglomerate with ten different
departments taking care of all aspects of the business. We are a team of 17 professionals spread across 7 countries. In fact, as far as I know, we are the smallest team to run a Vape start-up of this scale. Of course, each one of us wears multiple hats. It works because we are passionate about the product and true to the goal, we have set for ourselves.
We have a long racecourse laid down before us. There are a lot of challenges, but the underdog is motivated and will certainly doing its best to stay in the race.
What keeps the underdog running?
I cannot isolate one factor that makes AIRSCREAM run like clockwork. There are many variables in this equation.
Our team is definitely the biggest one. It might sound repetitive, but not just AIRSCREAM, any start-ups is as successful as the people running it. Our people have brought us where we are today, and they will fuel us to the finish line.
Their passion infuses a positive energy in our organization. It is always buzzing in the office with ideas being tossed around and good ideas being supported to come forth. The best part is that they are resourceful enough to work with what they have and use their ingenuity to produce good results.
You can’t artificially create such a culture. This culture is organic and stems from people who really believe in what they are doing. When we hire, we look for people who understand the industry and believe in our vision. I love going to work because I work with such people, and this emotion runs across AIRSCREAM.
We focus on the mindset of the customer. It is easy to put another vape product on the market. But, we want to offer a product that our customers pick up instead of a cigarette. It should be as easy as a cigarette to use and light on the pocket. With AIRSCREAM, the idea is not to be different for the sake of standing out but offering a good product that the customer can use every day.
Given that AIRSCREAM is a new brand, it is obvious that our business partners would not want to feature it on their shelves. They are looking to make a sale. So, we help them achieve that objective. Our experienced commercial team advises them on how they can grow their business with AIRSCREAM and make more sales. Our granular approach brings us loyal partners and increased sales per partner.
Given that we have created an international market for AIRSCREAM, we also put a lot of thought in our packaging. If we do not get the best shelves, we circumvent that problem by attracting our customers to whatever shelf we are on with our packaging. We are also cautious about keeping our packaging as per the local market rules. In fact, no other small company has accomplished that. This has been made possible by our small but experienced team. This is where the experience comes in.
How do you survive the uncertainty that comes with this business?
Entrepreneurs have to be prepared for uncertainty. The fact that we have a serial entrepreneur on board certainly helps. We have structured our business model to be robust.
First off, don’t forget that while a lean team comes with its cons, there are
many pros to it too. A lean team is extremely agile. When we are hit with a challenge, we can quickly move people around and reallocate resources. Since we are still small, we do not have any high overhead costs either. So, those have not been an issue for us yet.
Secondly, we are not exposed to the volatility of the Chinese market. I would
not call this a strategy as much as a constraint, but we have tried to make the best out of it. So, any regulatory changes in the Chinese markets, supply chain shocks, or new competitors (since China is a major vape market) does not impact us as much. We simply do not have the funds to market in such a competitive market and that allows us to focus on getting our products into the European stores. That has been our core market from the beginning and the regulatory changes are never as sudden as that of China.
Thirdly, we have a lot of support from our network of suppliers, our customers, and other people in the industry. These are the individuals who believe in the core values of AIRSCREAM and support it through challenges. Finally, we have a sound product in place. It was the initial product concept for AIRSCREAM that brought us all on board this journey. The dream team that the product helped bring together can bounce back from anything. We developed the first prototype for months, but the results did not impress us.
So, we quickly went back to the drawing board and redesigned. With the base concept in place and our iterations, AirsPops 1.0 was ready in 2 months for the Oceanic Vape Show in 2018. The team at AIRSCREAM is its best defence against uncertainties.
Where do you see AIRSCREAM in the future?
That’s a heavy question.
As we work on AIRSCREAM, we find that we are capable of producing an even better product. We see there is a lot of room to improve and we are working in that direction. In the short term, our goal is to keep at it. We want to test our limits and improve on the quality and the user experiences.
It is crucial for us to deploy longer product pipelines and more people working on them to produce the results we want. To fulfil this goal and get more talent on-board, we will also be looking to capture more channels of funding. To preserve the vision, our investors should also believe in our vision, concepts, and principles. Our track record is solid, and our future is promising, and our investors should be able to see that if we keep up what we are doing, an underdog like AIRSCREAM can come out as the winner.
In the long term, we want to become a leading brand in the world of vaping by helping smokers to bring down their dependence on cigarettes or even eliminate its use. We want to change the industry paradigm and transform the perspective towards vaping. At AIRSCREAM, we also want to support our brilliant team members to pursue their own start-up dreams too. AIRSCREAM would be a success story because of the contributions of these people. They believed in AIRSCREAM, and they should know that AIRSCREAM would believe in their entrepreneurial dreams too.