Making Vape at Purebacco

Feb. 15, 2015

Gaylord Company Takes a Big Bite out of a Growing Industry

Purebacco of Gaylord is one of two Michigan companies responsible for making Michigan third in the nation in e-liquid manufacturing, with products in nearly 700 retail locations nationwide. Last year, 23 Purebacco employees produced more than 9 million mililiters of product, making them big players in a rapidly growing market most Michiganders know little about.

Vape, Vaper, Vaporizer

In 2014, "vape" was named the Oxford English Dictionary word of the year. Although the term –"to inhale and exhale from an e-cigarette or similar device" – was first coined in 1983, dictionary editors claim the word was used 30 times more frequently in 2014 than it was just two years ago.

In this burgeoning industry, new terminology has quickly developed to describe the devices, liquids and users. A vape pen, or personal vaporizer, is a portable device used to vaporize a liquid. These vaporizers differ from "cigalikes" – disposable e-cigarettes that use packets or cartridges – because they use refillable tanks for flavored solutions. E-liquids or "juice" are the solutions, and a vaper is a user of a vape pen.

Purifying the Tobacco Experience

While Missouri and California passed statewide smoking bans in 1992 and 1995, large scale momentum against smoking didn’t quicken until 2003 when four states passed similar bans. According to the American Nonsmokers’ Rights Foundation, nearly 82 percent of the U.S. population currently lives under some form of smoking ban by state, commonwealth or local law.

While bans were passing across the country, Daniel Walsh, a participant in the industry before the modern e-cigarette, was looking for a new project.

"We were working on life enhancing systems and products. How could we make something, or develop something, that would enhance peoples’ lives?" explained Walsh, now CEO of Purebacco.

As a "smoker who liked smoking," Walsh’s focus swiftly turned towards the emerging e- cigarette market and the potential for purifying the tobacco experience.

Walsh wanted vaping to be a simple, convenient part of his life in the way that cigarettes had been, so he began working with electrical engineers to create a better all-in-one personal vaporizer. In January 2012, Walsh’s company, Akston Hughes, released the SVR – a sleek stainless steel personal vaporizer perfect for carrying in a tool box or a designer handbag.

Improving the personal vaporizor wasn’t enough for Walsh, so that same year he gathered a master herbalist, a plant biologist, a five-star chef and an essential oil specialist to create Purebacco and its first line of e- liquids, FlavorZ.

"We came up with the name Purebacco because our goal was to get rid of the tar, carcinogens and chemicals," said Walsh.

Beginning with only five employees, Purebacco has grown to a company of 28. Walsh explains Purebacco’s structure as an inverted pyramid, with the CEO at the bottom and entry-level employees, who comprise the bulk of the company, having the greatest significance on top.

Joe Lundell, Purebacco’s sales manager, carries that approach through to the customer.

"When a customer calls me, I help them in any way I can, even if that means I’m not selling them anything. I want them to feel so happy with my help that they want to buy me dinner," said Lundell.

Today, their two house lines, FlavorZ and Namber Juice, are sold wholesale to retail shops in nearly every state.

What They Make

In the vaping community, Walsh is often referred to as the High Priest of Vaping, with a philosophy that guides the flavor artists who work alongside him. According to Walsh, "Great vapor is not achieved when there is nothing more to be added. It is achieved when there is nothing which can be removed."

Purebacco’s lead flavor designer Greer Nelson won the Chicago Vape Shoot Out last year in her first professional outing. A developer of close to 80 percent of Purebacco’s blends, Nelson explained that their e-liquids are comprised of a 50/50 blend of propylene glycol and vegetable glycerin, flavoring oils and, typically, nicotine. Every flavor Purebacco manufactures comes in varying levels of nicotine or nicotine-free.

For the Purebacco family, e-liquid flavor development has been elevated to an art. In much the same way the craft beer movement has expanded flavor possibilities for brewing beer, e-liquids have seemingly endless potential flavors. Purebacco offered 43 flavors between their two house lines last year, ranging from strawberry champagne to carameland-coffee to menthol.

How They Make

It From start to finish, Purebacco’s products are manufactured in the U.S. – designed, assembled and produced at their headquarters in Gaylord. When construction began, they consulted a professional lab scientist to build an ISO-grade e-liquid laboratory, one of just three in the country.

Purebacco’s balance of craft, precision and cleanliness has drawn the attention of clients looking for flavor design, manufacture or, often, both. In their three years of operation, they’ve added the manufacture of eight separate lines for companies across the country, and Nelson and Walsh have each contributed to flavor design for peer companies.

What Lies Ahead

The future of the e-cigarette industry is undecided at best. As the products grow in popularity, questions regarding regulation, taxation and health effects continue to arise. After a 2011 court ruling, e-cigarettes were placed squarely under the jurisdiction of the Tobacco Control Act, but there is still discussion over where e-liquids and personal vaporizers will fit in regard to FDA categories and how such categorization will affect product regulation. With a $2 per pack sin tax, approximately 1.5 percent of Michigan’s annual revenue comes from cigarette sales. The tax, and its contribution to the state budget, is above the national average, so there is motivation to create an equally sizeable sin tax on e-liquids.

In January, Governor Snyder vetoed a bill passed by the legislature that would have prevented e-liquid sales to minors under 18, citing a lack of stringent regulation. Snyder believes e-cigarettes should be treated like tobacco products, but language in the bill would have prevented the state from regulating e-cigarettes in that way.

In 2014, Walsh hosted Congressman Dan Benishek at Purebacco to showcase the stateof-the-art facility and answer questions about the emerging manufacturing market.

Now shipping thousands of bottles daily, Purebacco recently purchased an additional work suite to expand the warehouse and shipping departments. With minimal advertising, their five most recent job openings were sought by over 50 applicants.

"I’d like to buy a 30,000-square-foot facility and bring in even more people," said Walsh. "But I’m just not sure where the state is going to go."

For Walsh, Michigan is the ideal place to run his customer-centered company.

"Other companies may be able to outmarket us, or out-spend us, but we’re what Pure Michigan is all about. We can out-work and out-manufacture anyone."