01 | the script
Nearly 200 years ago a guy was born in Whitechapel, opens his first shop on Bond Street, and when the business lands in America at the turn of the century, he finds everyone chewing and spitting tobacco on the street. Within 10 years, Phillip Morris [the man] convinces a change in format, and the number one tobacco market goes from chewing tobacco to smoking cut cigarettes.
More than a century later, a project from the South Bank of the Thames is looking to ask the same question of Philip Morris [the company]. Why smoke when you can AYR?
Transformation has always been at the heart of consumer products. Take the music industry. From the gramophone to the cassette player, to the CD and ultimately the iPod, change has been driven when new innovations have embraced the things that we love, making the adoption of new platforms and products as seamless as possible.
These disruptions have honoured the way we do things, and in doing so, they have come to shape their industries. When the iPod came out in 2001, it didn’t just seek to be the best MP3 player; it redefined the music business as it was. It changed the way people engaged with music, and at that time the music industry was at its height. Now we are asking the same question of an industry that is more than 40 times larger than the music industry at its height: the tobacco industry.
From the days of the peace pipe, to cut cigarettes, and early vaping devices as they are today, a $700bn analogue industry is in this process of transformation. We have been wondering: if there was a chance to invent something that honoured this ritual, what might it be?
When you look at vaping from the perspective of ease of use and familiarity, it sits in the hard-to-use and unfamiliar territory for the majority of smokers today, whereas smoking, the thing they love, sits in incredibly easy and familiar territory. So, the challenge is, how could you make vaping as easy to use and as familiar as smoking? Is it possible to create the iPod of vaping? We are asking this question, having assembled one of the most talented, multi-disciplinary teams to answer the call. We have partnered with one of the world’s largest manufacturers of the Internet of Things – from Apple Headphones, Google Nest, to Sonos – to bring our first product to market.
We have asked thousands of smokers what’s so sublime about smoking. And by reimagining vaping, we have reinvented this ritual around the principles that smokers love. Along the way, we have created one of the world’s leading patent portfolios in the category.
So, we didn’t simply set out to invent the smartest vaporiser. Our mission has been to bring about the end of cigarettes…and to do so on a platform that has been publicly backed by the Royal College of Physicians, Public Health England, and the National Health Service.
It’s a pleasure to introduce you to a project that has been in development for four years. We invite you to join us and become a part of AYR.
02 | a founding team
I wrote this script over Christmas of 2017. At that stage, we were still grappling with finishing the AYR1 device for market. We had just committed to bringing executive management to the team through TomTom to lead the go-to-market phase of AYR. It had also been four years since I had founded AYR with the help of Mew and Adie.
The project had assembled a truly incredible mix of talent with a singular passion—to help bring about the end of smoking. There are amongst us a combination of avid anti-smokers (myself included), ex-smokers (the lead industrial designer Mew and Co-Founder of AYR and Frenchie), closet, social (marketing team) and even open smokers (UX and UI team). We all believed there was a better way.
For nearly four years, an unusual structure in our initial founding team had held together – an equal six-way equity break between my founding investors (the first three strategic cash investors), co-founders and I, who each brought with them a unique toolkit and set of experiences. Francois Barou (or affectionately “Frenchie”) I had known during my Renew days. He had spent some time during the final months of Renew trying to help me rescue the project. I had to convince the Qatari Investment Bank of either honouring their capital commitments under our investment agreement by following their first tranche of deployment capital with the second tranche of operating capital, or moving off the balance sheet so we could bring new capital in. It was a particularly difficult time with managing my own team, which included coordinating with my more than sixty shareholders during a dynamic and distressing situation. Having spent some his formative years at Lazard as well as run his own boutique M&A practice, Frenchie gave me some sage advice during that difficult time, and I knew that AYR’s journey would have the privilege of many of those ahead of it.
Mew, Adie, and I also knew that in order to translate the “ritual” of smoking, we had to invent a whole new user experience and set of technologies like those we found in electronic nicotine delivery systems or “vaping” in 2013. We did not appreciate just how deep this challenge would run at the time but were aware that it meant the need for proper protection of our intellectual property portfolio. We spent some time researching the IP world – we were keen to find practitioners who were not going to simply scribe claims but were allowed to build a defensive portfolio that would also underpin shareholder value in the project. When we had Peter Langley (affectionately “Langelot”) attend the product studio, we thought it was the guy from Palo Alto rather than a former Linklaters employee. What made him stand out was his experience of picking European tech companies, including ARM, TomTom, and Kingly’s Candy Crush, and helping them shape valuable IP assets and, ultimately (as in the case of ARM), build significant businesses on the back of them. Importantly, Langelot was the CEO and 100% shareholder of his own boutique IP practice and could commit and control significant IP resources for the team.
Our seed round of investment was an injection of £150k in capital from Frenchie and Langelot, and the promise of their black book and IP practice were also committed to the project. To round out this team, we needed a seasoned consumer expert who also understood large corporations. This is where we turned out to be most fortunate with Andrew Morgan (“Morg”). Having worked and run DIAGEO for over 20 years, the last 10 of which spent leading a European business, Morg understood the consumer mindset and premiumisation better than anyone on the team. If anyone saw an opportunity for a “Nespresso for Inhalation,” it would be the man behind the Blue Label Johnnie Walker. He also committed further capital to our fledgling team during its formation in December of 2014.
In the AYR founding team, we assembled an incredible ability to imagine a brave new world, to protect it, fund it, and position and launch it for success.
03 | proof of concept
In the initial phase of developing AYR, we had to prove that in principle, the mechanical, electrical, and digital theory behind how the system could work was possible. We had to achieve this with minimal investment using existing components and technologies to approximate what it was that we were trying to achieve. Early in 2015, after the formation of our founding team, and with the capital that we had internally invested (ahead of our first capital external tranche of capital), we worked with a number of mechanical, electrical, and digital experts and hacked together the elements within AYR.
The compilation video here shows how we moved from the principle of the mechanical moving of liquid from A to B to demonstrating a two-part product (vaporiser and case) powered by rudimentary Arduino-based electronics. The video also shows the principle of capturing data from the vaporiser to the case via a wired connection to servers in the cloud. This was the initial work that allowed us to substantiate the narrative that AYR was certainly technically feasible. It would take us another four years to prepare fully for a go-to-market product for customers.
04 | the patents visualised
It was evident from early on that creating a new product experience required not only inventing new technologies, but also protecting those discoveries along the way. Most start-ups find it difficult to move beyond the investor checklist of “Do you have IP?” to meaningful and monetisable patent portfolios. The difficulty is twofold; firstly, there is the matter of genuinely novel thinking, and secondly, there is the cost.
So we began work by the summer of 2014 to form the most significant patent portfolio in the user experience space. We had initially described the concept of AYR in a patent filing dating back towards the beginning of the year. What we did next was to break that individual patent into all of its individual constituent parts – like breaking a complex molecule into its atoms. The idea was that AYR represented a particular combination of novel ideas, but we were keen to protect the novel ideas at their most fundamental and separately, that way allowing for multiple combinations and permutations of products from a common patent family.
05 | on the ritual of smoking
Smoking cannot simply be explained as a nicotine habit, no more than a cigarette described as a nicotine delivery device – at least not to the more than a billion smokers who continue every morning to reach out for their pack. If smoking was seen purely from the perspective of nicotine addiction and delivery, then nicotine gums and patches would have cured the problem for the most part. If the behaviour was understood simply as nicotine craving, many smokers would not relapse six months after quitting at a party when having a drink. The nicotine would have long left their system. To understand the mindset of a smoker, we need to understand what is so delightful about smoking for smokers.
To help summarise the complex and, at times, contradictory and conflicting behaviour of smokers, we found ourselves increasingly relying on a single explainer word—“ritual.” It became clear that smoking plays a far more important role in the lives of smokers than simply nicotine delivery. It is when a smoker takes a break from work, family, life, and the daily grind, and—for a simple, repetitive and finite period of time—reflect, often alone. So with AYR, we began to think about how to translate the “ritual” of smoking or the things that smokers love about smoking, leaving behind the things that they hate—the smoke and tar. Along the way, we asked a few thousand smokers what they thought, and the feedback grew increasingly encouraging that we were onto something.
06 | not just a device
Having spent the first three years of AYR focused on inventing and designing a unique delivery platform and a true alternative to smoking for smokers, it became clear that the total experience of AYR was not simply the hardware (and the software that drove it), but importantly the flavour experience that it enabled. After all, what was the point of having developed the most sophisticated and beautiful delivery platform if it did not fundamentally appeal to the palette of smokers? We spent over a year working with flavour houses and smokers until we created a family of flavours that would appeal to not only the hardened smokers but also those who wished to move away from the fundamental taste of tobacco as they moved beyond combustion.