Saturday, February 24, 2018
Business

Tampa Bay's No. 1 small top workplace: White Cloud Electronic Cigarettes

TARPON SPRINGS

White Cloud Electronic Cigarettes' sprawling new headquarters was, one might assume, designed by a teen with his mom's credit card. Nerf darts whistle among a stereo booming old-school hip-hop, an Xbox 360 and a game of ladder toss. Upstairs, executives convene for a meeting on beanbag chairs with their "head of legal," a parakeet. "We try to eschew the typical corporate persona," founder Matt Steingraber says, redundantly, after a recent company barbecue, while wearing owl-eyed Oakleys and a Cap'n Crunch T-shirt. "We don't want to come into work with people who hate us, or think we're a--holes, or unreasonable," he says, shifting atop his beanbag. "We're not overlords constantly injecting our own DNA into every little thing. Everyone has a say." Catching too many stoner vibes to take them seriously? Let this blow your mind: Whatever they're doing, it's working. Employees love White Cloud so much they voted it the best small business in the Tampa Bay Times' survey of Top Workplaces.

The Tarpon Springs upstart, already an institution in America's $1.5 billion e-cigarette industry, has in half a decade bloomed to 85 employees and $14 million a year in revenue, which has doubled every year since launch.

But even as White Cloud has exploded from slinging e-cigs in mall kiosks to a global enterprise, workers have celebrated the company's creative goal-setting and openness to employee ideas, from buying company bicycles for leisurely break-time rides to testing and selling new flavors of their nicotine-infused "e-liquids."

White Cloud's growth highlights how much the Internet today can help even a niche startup accomplish. Though ostensibly a small business, the firm has coordinated with manufacturers in China, invested heavily toward research and design and shipped its products within days down the street or across the globe.

Their industry sits on a slippery cliff: Neither e-cigarettes nor e-liquids are regulated, though the Food and Drug Administration says guidelines are to come. And though e-cigs are seen as safer than cigarettes, research into the long-term effects of sipping on nicotine vapor could still be years away.

But the founders say their employees, most of them former smokers, are fueled by the belief that they are helping undercut Big Tobacco's lethal cigarette juggernaut.

"Being part of a company that is saving lives everyday," one worker said, "is incomparable to anything out there."

• • •

Years before they opened their 20,000-square-foot headquarters, White Cloud's founders — Danielle Steingraber, 34; her husband, Matt, 35; and their former coworker, Michael Murray, 38 — spent every morning hovering over laptops in a cramped Volkswagen Jetta.

Their fledgling e-cig business depended on a ring of Tampa Bay mall kiosks, all with one employee each, so every day meant a long slog of cash drops, on-the-spot training and attempts to convince shoppers that the battery-powered nicotine sticks were more than a passing fad.

The group had literally stumbled into e-cigarettes, or at least their vapor cloud, while at a trade show in Las Vegas, scrounging for ideas for an online storefront they envisioned would sell gift bags.

At a booth, they discovered that e-cigs, which heat e-liquid into a wispy, smokeless vapor, looked like cigarettes but were cleaner, sleeker, safer and virtually unknown.

"I thought, 'This is just going to be the next rocket to outer space,' " Matt Steingraber said. "It was the equivalent of going back in time to horseless carriages and seeing an automobile."

Their first days as a distributor for a Miami e-cig manufacturer proved disastrous: Mall sales were erratic, and most of the early e-cigs proved defective. So in 2009, they decided to build their own, looking up component manufacturers on global-trade sites like Alibaba and booking $1,600 self-funded plane tickets to Shenzhen, China's industrial core.

Relying on overseas engineers and factory workers for their chargers, batteries, e-liquid cartridges and boxes was a risky gamble, Murray said, adding, "You can get skinned very quickly over there if you don't know what you're doing."

But within months, they had worked out kinks in their blueprints, poached a product manager from a Chinese engineering firm and begun shifting most of their manufacturing and assembly to Tampa, where they could more closely oversee the work.

This year, they also upgraded their corporate offices from a cavernous, windowless "dungeon" at the Westfield Countryside Mall to a Tarpon Springs distribution center and headquarters five times larger than their former space.

Their new offices are an island of lightness in an otherwise dingy industrial park, with breezy work spaces, sky-blue walls and not a whiff of smoke or tar. "Picker packers" pull on sweet-smelling e-cigs while sorting through the spotless warehouse's $1 million in ready-to-move inventory.

Rob Burton, White Cloud's director and head of corporate and regulatory affairs, said the wide-open workplace is all about having "the space to be creative." But like its name and product design, it also helps differentiate the company from much of the nascent e-cig industry's shadowy underground repute.

"Most (e-cig) advertising was very dark, black, gangster-looking, but this," said Danielle Steingraber, gesturing to one of the company's Cirrus 3 e-cigs, "is so clean. It should be light and airy and inviting. We need to be different."

• • •

It's no coincidence that White Cloud is an incredibly young company, launched by and composed of largely 30-somethings. Burton, who last worked at British American Tobacco, the world's second-largest tobacco giant — and, at 48, is White Cloud's oldest employee — said the youthfulness allows the company to have "way less baggage."

"We can be a little more creative, more relaxed and dynamic. The industry's changed so quickly, you need an organization that's willing to change and be ahead of it," he said. "If you have the traditional older-style company, its sometimes like steering a supertanker. It takes a while to actually turn. We consider ourselves a bit more agile."

But even with many of their workers still in their salad days, White Cloud's founders take a hands-off approach at guiding their employees' work. They pride themselves on a flat hierarchy, with little of the teetering bureaucracy that can slow companies to a crawl.

"We don't want to dictate or micromanage. That's very time-consuming and tiring," Danielle Steingraber said. "We want people who are intelligent and can do what they need to do, and do it well."

Of course, not all of that energy ends up spent behind a cubicle, which is exactly what the founders want. They encourage creative touches, like taping a moving-day video in which employees are seen riffling through boxes while "vaping" on the company's e-cigs or the Pez-dispenser-lined cubicle of Lily Hoddinott. White Cloud's 28-year-old social media coordinator also displays a sign from China with a Mandarin refrain that seems to have lost something in the translation: "Smoking Make You Feel Fine Like Your Soul Dancing in the Sky."

But the firm is serious about competing with not just other e-cig makers, but Big Tobacco, which has increasingly become a contender in the battle over e-cigs' market share. Some have worried tobacco giants could end up stealing the market e-cig startups built from scratch.

"It's like going to a nightclub, chatting up a girl all night," Burton said, "and then somebody comes in and takes her to bed."

Last year, White Cloud inked a research partnership with University of South Florida marketing professors to learn more about how to entice smokers looking to switch to e-cigarettes. They've built a "puffing machine," which looks a lot like a high-school science experiment, to standardize e-cig puffs and invested in an improved age-verification system to keep kids away from their online store.

But the founders say their workforce could prove to be the most powerful key to keeping them competitive. To help, they say they're setting up their office as a kind of modern playground — and letting their workers explore.

"They've got guide rails and a group for support, but they want to get there on their own," Matt Steingraber said. "So we provide the conduit where they can have success. They can look back and say, 'I did this.' "

Contact Drew Harwell at (727) 893-8252 or [email protected]

   
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