Force of habit

Brothers QJ and Kayne Satchell love the fact that they’re in business together, and they’re pioneers in a niche that’s making a difference in people’s lives.

Tokoroa brothers QJ and Kayne Satchell were so convinced of the efficacy of vaping as a tool for breaking the hold cigarettes had on them, and too many other Kiwis, they set up an e-liquid manufacturing company, NZVAPOR, in regional Auckland. Both had been heavy smokers and quit through early exposure to vaping in 2011.

Today they employ a staff of ten in their recently opened facility on the edge of Silverdale, 30 minutes from Auckland’s CBD. 

The purpose-built facility has an ISO grade 5 ranking, higher than that of a standard hospital theatre, and achieves air particle densities 30,000 times smaller than required. Its shipping bay and storage facilities have room for the expansion they predict. 

Better still, they have been, and continue to be, self-financing.

The brothers also have a “world-first app”, based on a five-week quit smoking campaign developed and perfected by a local – grassroots campaigner Rebecca Ruwhiu-Collins – which they trialled and researched before releasing.

“Because the app is used by smokers taking on one of life’s greatest challenges, it is regarded as ‘unassisted’ support, which traditionally has a 20 percent success rate. We are achieving
69.8 percent,” says QJ.

NZVAPOR was also the first company to locally market the POD vaping device – a more discreet and sophisticated delivery mechanism than the MOD, or bottle, which produces a large, distinctive plume.  

QJ and Kayne had always shared an ambition to work together. Older sibling Kayne had headed for the Navy after leaving school; he was followed by QJ. Thereafter, they joke they “hadn’t a clue what they would do.”

Says Kayne: “We washed dishes, tried being chefs and running a restaurant, got into property development. We even tried DJ-ing, labouring, anything that came up. I largely kept to sailing and got into super-yachts in Florida and the Caribbean. Graeme Hart and the first Ulysses super-yacht were among clients.”

Over the years their passion and commitment to work together remained undiminished. 

However, both were heavy smokers. In 2011, Kayne tried vaping to please his wife – who accepted, but loathed, his 40-a-day habit. He quit, and sent a package to QJ, who was selling tyres back in New Zealand. 

The ‘a-ha’ moment dawned.

Game on

Kayne purchased an early blender and painstakingly loaded a small supply of e-liquid in a small Florida-based clean-room. He then shipped them, with permission from one of his billionaire clients Troy Ducharme, on a super-yacht and private jet, for couriering via California. 

A bit more R&D followed, but by 2012 they decided it was game on. 

“We reckoned this was our moment,” recalls Kayne. “We sold our home and dived in, knowing that if we wanted to be a player in helping Kiwis quit smoking and have a profitable future business, we had to do everything ‘by the book’ – be it the quality of ingredients or the sterility of our manufacturing process. And, critically, [we had to] gain the support of the medical authorities. 

“No illegal imports, dodgy distributors and harmful ingredients,” says managing director QJ – who now works with the Technical Advisory Board for the Ministry of Health, is president of the NZ Vaping Alliance, and co-operates with many universities, DHBs and other institutions to set standards for the industry.

“The realisation that this wasn’t going to be a walk in the park was there from the outset,” he says. “We were getting in the faces of the likes of global-corporations like Philip Morris and BAT at the one end, and locally we were launching at a time when the ‘legal highs’ industry was defiantly selling their volatile and ever-changing stuff.

“We had to stay true to our values and purpose, to convert traditional smokers and not induce non-smokers to try vaping – especially youth – if NZVAPOR was to succeed in our chosen niche. 

“So far, that has worked out. It has taken six years of hard grind though – meeting with regulators and opponents; going to symposiums to explain and clear-up misunderstandings of what we are about. 

“And all the time under the strictest scrutiny. We had to be more transparent about our business than most and had to prove everything we claimed along the way,” says QJ.

Spreading the word

QJ recalls how they started selling to family and friends who wanted to quit smoking. That was followed by morning markets where they offered to trade a bottle of e-liquid for a packet of cigarettes.

“We would use Facebook to tell people we would be at a market, say in Browns Bay, or a lifestyle event, and do swaps, while spelling out the role vaping could play in helping smokers to quit. 

“At the same time, we were having to overcome the fact that the immature industry then called them ‘e-cigarettes’ – instead of our preferred description, ‘vape devices’,” he says. 

“And people and the health authorities would see what they took to be huge plumes of whatever emanating from bottle to mouth, and could only imagine the worst. 

“[It was] tough times; but we are now mostly through those.”

Recently, the number of people approaching Quitline has increased by a third, with a significant and growing proportion of those using vaping as a tool to give up. 

“Cost is on our side too,” says QJ. “Vaping is a fifth of the cost of smoking. Even when you purchased a rechargeable device with your first bottle of liquid – ballpark $40 to $50 in total – that will cover your first month of vaping too. After that you are buying liquid only.”

He says they only stock devices sourced directly from top-end suppliers and demand certification to ensure they have high-grade steel in the coils, Samsung certified batteries, and so on. “So we don’t end up with counterfeits on the shelves.  

“We are also in the final stages of tying up a deal with Aussie entrepreneur Ryan Boulton, who brings IP on devices, legal access to the Australian market, his Nicovape brand and supply chains,” says QJ. “Along with that we’ve secured the financial backing of several leading Kiwi supporters.”

“Once we’ve got it up and running, the next step is global leadership,” Kayne adds.

The Tokoroa duo – who both appreciate the various skills they developed over several years leading up to this business probably helped them more than any post-school study – have clearly come a long way. All helped by their in-depth product and market knowledge, their persistence and their courage.   

How big is the vaping market?

“We know there are around 200,000 Kiwis vaping in New Zealand, according to the latest IRI Market Research (August 2018) and most of these people are ex-smokers. 

The research shows that 54 percent of vapers are ex-smokers who have fully switched to vape; 36 percent are dual users, and half those dual users now smoke fewer than four cigarettes a day.”

Kevin Kevany  is a freelance business writer.
Email [email protected]