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No Investors, No Ads: The Reality Of Running A “Controversial” Business In M’sia

Becoming a founder isn’t something that would gain the head shake of disapproval from Malaysian parents, but becoming one of a business selling a controversial product might. 

For Jeremy, in spite of what his family would think of him, he was adamant about pursuing a vape subscription business. 

“After deciding to launch Vape Club, I told them. And everyone thought I was crazy,” Jeremy shared in an interview with Vulcan Post. 

To add, he said his family and friends were probably betting on the failure of his company from the beginning. 

Wanting A Conventional Career Path For Their Son

Like any other Asian tiger parents, Jeremy’s are no different. He came from a middle-class Chinese family, and naturally, they wanted their son to follow a conventional career path.

He was expected to study hard, get a scholarship, go to university, get a good job, and retire at 60. 

But Jeremy had always felt that this path wasn’t right for him, as he couldn’t imagine himself doing this for the next 30 to 40 years until retirement.

When he started Vape Club, he’d only been working for 2 to 3 years, and he received comments about how he wasn’t fit to start a business yet because he lacked the experience.

“Luckily, I’m quite thick-faced. So, I didn’t really take what they said seriously and just continued doing what I needed to do,” he shared.

Controversy Is A Perception

“If society decides to see this business as a controversial one, I can’t stop them. But in my eyes, it’s perfectly fine,” Jeremy explained his stance on his business.

One frequent comment he’d receive from people about Vape Club was the health aspect of it. People wondered why Jeremy would want to encourage Malaysians to pick up a “negative” habit like vaping. 

However, Jeremy sees his business as helping those who are avid smokers slowly find a way to break out of the habit, much like he personally did.

“I used to be a cigarette smoker back then. And when I did an X-ray, I found that my lungs were pitch black at the time,” he shared. 

After he switched to vaping, he later went for another X-ray and learnt that his lungs had become healthier.

“If you’re not a smoker, you shouldn’t vape. But if you’re a smoker looking to reduce harm to your body, I don’t think there’s a problem with that,” Jeremy explained.

Some of Vape Club’s line of products / Image Credit: Vape Club

Being Comfortable With Uncertainty

Because there were a lot of grey areas when it came to a business like this, Jeremy shared that many investors weren’t interested, which made it harder for them to accelerate their growth. 

“When I say ‘grey area’, I mean there were no laws that governed vaping, up until 2018 when Europe started to impose taxes, regulations, packaging requirements, etc.,” Jeremy explained.

“In Malaysia, the laws are very concrete. If you’re selling nicotine, it’s a crime. But, in reality, there is zero enforcement from the lawmakers. There are still tons of vape shops in Malaysia and they most definitely sell products that contain nicotine,” he added.

With investors’ lack of confidence, Jeremy and his team had to bootstrap everything with less than RM10,000 in initial capital, and reinvest their profits over time. 

However, during Black Friday in 2017, they managed to hit RM500,000 in revenue in a month, something that Jeremy considered a huge milestone for the bootstrapped company.

“When you’re operating in a controversial space, you need to be comfortable with uncertainty much more than other businesses,” Jeremy advised. 

For example, prior to starting Vape Club, he wasn’t aware of the advertising policies on Facebook. After he built up the website and more, Facebook then banned their ad account for advertising vape products. 

On top of that, Paypal also shut down their payment gateway, closing them off from a popular method of payment globally.

Staying One Step Ahead

Despite how uncertain the regulations of controversial businesses could be, Jeremy explained it’s an industry that isn’t easily shut down. More people have already made such businesses their livelihoods, as the many vape shops that have popped up in Malaysia show.

However, he foresees the government implementing excise taxes just on cigarettes to open another revenue stream, tightening packaging regulations like requiring producers to put anti-smoking pictures and slogans on them as well as requiring manufacturers to get licenses.

“As an entrepreneur, what I can do when [we’re] at risk of new regulatory implementations, I’ll try to diversify my income streams and develop other businesses ahead of time,” Jeremy said.

Interestingly, there aren’t many red tapes of note disrupting his business. Right now, the only tax imposed on his products is SST.

He shared that because 99% of Vape Club’s customers are also from outside of Malaysia, this most likely would cushion his impact should any legal changes affect the industry.

“We’ve actually received a ton of lawyer letters, not for legal trouble, but because a lot of Malaysian vape brewers are brand copycats. Like if they created a Milo flavour, they would make the exact font and branding but just change the name to ‘Meelo’,” Jeremy shared.

Hence, over the years, they’ve gotten lawyer letters from Kinder, Red Bull, Pepsi, Häagen-Dazs, etc. asking them to stop manufacturing these products.

But Jeremy would typically redirect those to the manufacturers instead because Vape Club is just a reseller and has no liability in that. Thus far, they’ve evaded any further issues.

To Those Who Want To Start A Controversial Business

For rookies who are thinking of starting a controversial business but aren’t getting the support of their friends and family, Jeremy had simple advice:

“Do you want to succeed more, or do you want to give a shit about what other people think? Just don’t get into trouble, don’t do anything illegal.”

He also believes that it’s important to have more faith in your own business because if you don’t, it can reflect on your performance. 

That being said though, he is no longer as hands-on with Vape Club since the vape industry is no longer as lucrative as it was in 2017-2018. 

Jeremy took his experience from Vape Club to build a new startup called Hustlr, an education platform to help entrepreneurs succeed digitally.

  • You can learn more about Vape Club here and Hustlr here.
  • You can read about other startups we’ve covered here.

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Vulcan Post aims to be the knowledge hub of Singapore and Malaysia.

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(UEN 201431998C.)

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