Johnson Creek — Christian Berkey was a nearly two-pack-a-day smoker when he heard about electronic cigarettes, a device that vaporizes a solution of water, nicotine and flavoring without the smoke and the combustion.
Berkey went on the Internet and ordered the device.
“I was stunned. I took a puff, and it gave me the same experience as cigarettes,” Berkey said. “It looked like smoke coming out, but you can’t smell it. It addressed the tactile sensation of smoking.”
There was one problem.
“I was not thrilled by the taste,” he said. “Chinese smoke juice had a chemical aspect to it.”
Berkey decided he could do better. He wasn’t worried about perfecting the pen-like device, which carries a battery and usually has an LED light on the end. He believed the solution to a successful smoking experience was to make the smoke juice taste better.
Berkey went to work, testing various formulas and trying to improve the taste. That was in November 2007. By February 2008, he started to see some results. Two months and countless variations later, he found the formula he liked.
Unlike the Chinese version, which contains countless ingredients, Berkey’s formula was simple, using only seven ingredients.
In July 2008, Berkey quit his job as a manager of an Apple retail store and took the plunge.
He started to talk about his product on online forums devoted to e-cigarettes. He offered consumers free samples. The feedback he was getting was good.
“They loved it,” he said. “No one wanted to touch the Chinese stuff.”
That was Berkey’s “aha moment.” He cashed in his 401(k) and started his business, called Johnson Creek Enterprises.
“It was not an easy decision, but I did it,” Berkey said.
Berkey convinced Heidi Braun, another Apple employee, to join him. A non-smoker and an asthmatic, Braun wasn’t exactly the ideal business partner for an e-cigarette smoke juice business.
“But I trusted Christian’s ability to come up with a business plan,” she said.
From that humble start, Johnson Creek Enterprises has grown to 14 full-time employees, has a thriving business that expects to generate $2 million in sales this year, and is looking to move into bars, restaurants, bowling alleys and taverns with sales of e-cigarettes and the company’s Johnson Creek Original Smoke Juice.
And the two did it with no advertising.
At their cramped headquarters in a Johnson Creek industrial park, Berkey, the CEO, and Braun, the chief operating officer, are proud of the quality controls they have in their business. The smoke juice is prepared and put in small bottles in a “clean room,” a controlled environment where products are manufactured, where lab technicians wear head-to-toe lab coveralls and goggles.
The company claims to be the first company to produce smoke juice in the United States. It lists its ingredients on every bottle, uses child-resistant caps on the bottles, and shrink wraps the bottles for extra safety.
Berkey and Braun say business is so good, they plan to add as many as 12 to 14 more employees in the months to come. And they are looking for a bigger building to handle their needs.
Johnson Creek Enterprises produces 10 different flavors in four nicotine strengths for the firm’s Johnson Creek Original Smoke Juice line. And it offers six flavors in three nicotine strengths for the Red Oak, propylene glycol-free smoke juice line.
A 1-ounce bottle of smoke juice costs $19.95. A half-ounce bottle costs $9.95.
Regulators take notice
The business is not for everyone. The Food and Drug Administration conducted a lab test of electronic cigarette samples it said contained carcinogens and toxic chemicals, such as diethylene glycol (DEG), an ingredient used in antifreeze.
Moreover, the FDA warned that smoke juice and e-cigarettes are being marketed and sold to young people, and contain no health warnings. The flavors, the FDA said, “may appeal to young people.”
The FDA study, Berkey said, did find DEG but in trace amounts. Asked whether the FDA had tested Johnson Creek smoke juice, Berkey said he could not comment.
“I know regulation is coming, and it’s fine,” Berkey said. “We definitely look forward to working with the FDA.”
Berkey and Braun also are anticipating July 5, when state businesses must go smoke-free. The company has an exclusive agreement with Blu electronic cigarettes, and hopes to convince the owners of bars, restaurants and other public places to sell the e-cigarettes and their smoke juice in their establishments.
“We have a lot of folks who are interested in this,” Braun said.
The new law does not forbid the use and consumption of e-cigarettes, but both Berkey and Braun agree their venture will only succeed if they educate the public about the device and their smoke juice.
Maureen Busalacchi, executive director of Smoke Free Wisconsin, isn’t buying it. Johnson Creek’s efforts to get into the restaurant and bar business by selling the e-cigarettes and the smoke juice may confuse people.
“And it’s appalling they are trying to get kids addicted to nicotine,” she said.
Berkey understands that. Puffing on an e-cigarette, he and Braun argue that people should educate themselves on the product.
“This is an alternative. It’s better than smoking,” Berkey said.