E-Cigarette Maker Juul Labs Is Raising $1.2 Billion

Juul Labs Inc., a startup that makes electronic cigarettes, is raising $1.2 billion in a financing round that would value the company at $15 billion, said people familiar with the matter.

Juul plans to use the influx of cash to expand internationally. Outside of the U.S., Juul's flagship vape pen is currently only available in Israel and the San Francisco-based company wants to broaden distribution, said one of the people, all of whom asked not to be identified because the company’s plans are private. Current Juul shareholders include Tiger Global Management and the mutual fund firm Fidelity Investments, according to publicly available disclosures. With the new money, the company will be worth more than $16 billion. Juul declined to comment on the funding.

Since launching in 2015, the Juul has been a runaway success. Vapers appreciate the flat rectangular product design, discreet size and powerful pre-filled nicotine pods. Sucking on a Juul creates a similar sensation to smoking a cigarette.

As of last month, Juul had captured 68 percent of the U.S. e-cigarette market, according to Nielsen data compiled in a Juul investor presentation viewed by Bloomberg. The company’s growth has made it a bright spot in an ailing industry. Since January 2017, cigarettes' share of the smoking and vaping market has fallen by almost 4 percentage points. Juul's market share has jumped by roughly 3.5 percentage points in the same period.