NJOY, E-Cigarette Maker Seeks $5 Billion in Valuation

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The manufacturer of e-cigarette and vaping products, NJOY is seeking to raise $5 Billion in valuation. It’s no less than a spin-off for NJOY as the company filed for bankruptcy three years ago. This turn around by NJOY might sprawl the growth of the market leader Juul labs.

The NewYork based company was founded in 2007. NJOY filed for bankruptcy due to failed the product launch that attracted litigation and enormous regulatory expenses. But now, the company is gaining momentum in the market with the new vaping device and other products like heat flavored nicotine-laced liquids. The cost of the product is less then the Juul’s and this is averting the customers towards their products and boosting the sales.

According to the people close to the matter says that NJOY will be raising $300 Million in the new round. NJOY was valued at $2 Billion till last year. It has also raised $285 Million in equity since after emerging from the bankruptcy protection in 2017.

It’s possible that Juul can crush down the NJOY under the ground by overtaking the prices down. The reason behind is the investor that’s backing up the startup. Altria Group Inc, the maker of Marlboro invested $12.8 Billion in Juul Labs this December is now worth at $38 Billion in valuation.

NJOY includes early investors such as billionaire venture capitalist, Peter Theil, and Napster founder Sean Parker. But the investors walked after its King 2.0, a disposable e-cigarette saw plunging sales and eventually flopped in the market. The relaunch of the product in 2017 called NJOY Ace captured the market slowly but was successful to keep the company on the tracks. It’s market sales grew from 2.7% to 6.2% for total e-cigarette sales this month.

Ace sells for $7.99 on the online market and Juul sells the vaporizer for $19.99. While Ace Pods are expensive a dollar more than the Juul’s one. NJOY witnessed $14.1 Million in sales in this March. It has increased its sales by 4X since December. Over a period of time, the FDA reported that NJOY is selling its products to the minors in their retail stores.

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