(Bloomberg) -- Juul Labs Inc. founders Adam Bowen and James Monsees became the first e-cigarette billionaires after Altria Group Inc. has acquired about a third of their company.
Altria announced Thursday that it invested $12.8 billion in Juul, valuing the firm at roughly $38 billion. Assuming the transaction dilutes the holdings of current shareholders, the founders each own stakes of 3.6 percent, or $1.36 billion apiece, according to the Bloomberg Billionaires Index. Bowen, 43, and Monsees, 38, each controlled 5.6 percent of Juul after a July funding round that valued each of their holdings at $843 million.
The deal makes San Francisco-based Juul more valuable than Airbnb Inc. and Elon Musk’s SpaceX.
“This is a disruptive technology and it shows where consumers want to go,” said Ken Shea, a Bloomberg Intelligence analyst. “It’s growing so fast that the cigarette companies like Altria need to look at a way to mitigate not only cigarette use but also think for the future.”
Bowen and Monsees came up with their big idea while pursuing master’s degrees at Stanford University and founded Ploom in 2007. They sold the name to Japan Tobacco Inc. eight years later and renamed their company Pax Labs Inc. Around the same time, the pair introduced a USB-shaped e-cigarette and called it the Juul. Last year, Juul was spun out from Pax and has gone on to dominate the market.
--With assistance from Tom Maloney, Olivia Zaleski and Michael Hytha.
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