Is Juul the Startup World’s Greatest Long Con?

“It was 25 years ago that executives at Philip Morris and six other American cigarette companies testified before Congress that nicotine was not addictive. Even under oath, the tobacco giants continued their decadeslong practice of gaslighting the public about the negative effects of cigarettes, which were once actually marketed by doctors. The image of seven CEOs being sworn in to answer for their companies’ misdeeds has endured as a powerful visual shorthand for modern corporate villainy. As the lethal effects of cigarettes were drilled into the minds of young would-be smokers by middle school counselors and aggressive ad campaigns, smoking entered an ongoing decline in usage. Big Tobacco had been felled.

Or so it seemed. In late December a Virginia-based conglomerate called Altria bought a 35 percent stake in the San Francisco startup Juul Labs for almost $13 billion. Juul is a maker of e-cigarettes and says its goal is to help adults quit smoking. Altria is the rebranded version of Philip Morris, whose entire corporate directive is to get adults to keep smoking. Juul says its wild popularity among teens is an unfortunate accident. Philip Morris once wrote an internal memo that said, “Today’s teenager is tomorrow’s potential regular customer.”

This seems like a horrible corporate mismatch, unless you see it for what it is: the pairing of two scheming businesses deftly executing a long con. In the decades since Big Tobacco took so many PR lumps that its biggest player had to change its name, tech has emerged as the sector most likely to sell people a bill of goods. Phones that were supposed to make us more efficient have made us less so. Social networks that were supposed to bring us all together have repeatedly driven us apart. By joining forces with its professed enemy, Juul is skipping a bit ahead in the Silicon Valley startup timeline, which generally follows a three-step track: (1) Don’t be evil; (2) be evil sometimes, but only when it’s in service of a greater societal good; (3) actually, being evil is fine.

 

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January 9, 2018