CHILLS OUT

Story by David Bienenstock

Chris Hill started CHILLS Tobacco in his father's garage at the age of 22. When yearly sales hit $3 million, the National Republican Congressional Committee named him "Businessman of the Year" in Florida. Then a team of Iowa federal agents flew south to raid his home, his store and the factory where he manufactured CHILLS pipes, and Chris Hill went to prison.

Chris Hill is trying to make up for lost time. He shifts gears in his Porsche convertible, accelerating through light traffic on the highway between Tampa and his home in Sarasota. The car is not new, but it’s new to him. He sold his last Porsche a year ago, right before reporting for duty at a federal prison camp.

Shouting over the noise of the revving engine and the salt air whipping above his head, Chris explains that he’ll never really make up for lost time, or any of his other losses. He’s been out of prison for six weeks and is trying to build a new business from the ashes of the last one. He’s separated from the mother of his children and trying to piece together a new family from the one that was torn apart. And he’s making progress. Putting the past behind him like the yellow lines on the asphalt.

Chris Hill started young. His first entrepreneurial venture consisted of selling sunglasses through classified ads in Rolling Stone magazine. After breaking even, and while still in high school, Hill moved into pushing high-end foreign cars at a personal markup, operating as a "kitchen-table broker" in the pre-Internet ’90s. Over the phone, no one knew his real age.
And then, after a few years of shuffling through community colleges and false-start business plans, he finally had the million-dollar idea—and he had it while stoned.

"I was in Wisconsin on my way to a boys’ camp where I was going to be an instructor in French, water-skiing and Native American studies. I was smoking with a friend, and I’ll never forget his pipe. It was a 1-3/4'' by 12'' purple Matrix waterpipe," Hill recalls fondly. "My friend told me they were sold all over the country and that he paid about 24 bucks for the one we were smoking. That’s when I looked at it, turned it all over and said to myself, ‘Man, I bet I can make this thing for about four dollars.’ And it turned out I could make it for a little less."

And so CHILLS was born, started up in Hill’s father’s garage with $4,500 in student loan money. The young man at the helm practiced a simple mantra: sell, sell, sell, spending 19 hours a day developing, sourcing and manufacturing alternative smokeware (waterpipes, hookahs, handpipes, glass, ceramics, etc.) and pushing his brand. The start-up soon grew out of the garage and into a condemned warehouse by the interstate, then moved on up again to downtown Sarasota. With a loan guarantee from the federal government’s Small Business Administration, Hill eventually bought out two neighboring buildings and began wholesaling smoking apparatus nationwide.

In its last year of US operation, CHILLS had annual sales of over $3 million, 35 full-time employees, a 401(k) retirement plan and a simple formula for success. Despite the dubious (read doobie-us) nature of the merchandise, the CHILLS business plan was anything but radical.

"We prided ourselves on three things: product quality, customer service and same-day shipping," Hill explains. "It’s those three things that grew the company."

The highlight of Chris Hill’s business career came at the 1999 Inc. 500 awards, when Inc. magazine included CHILLS in its annual list of the fastest-growing private companies in the United States. He attended a black-tie ceremony in Vail, accepting the award from Colorado Governor Bill Owens. For Hill, who decided to forgo an acceptance at the Sorbonne in Paris to stay on with a then-fledgling CHILLS, the award was his personal "college graduation."

Chris Hill never saw it coming. He’d read the drug paraphernalia laws, including a 1994 Supreme Court decision (Posters `N' Things , Ltd. v. United States), and strove to keep CHILLS in compliance to the letter. Drawing his personal and business philosophy from the novel Atlas Shrugged by Ayn Rand, the young entrepreneur saw himself as engaged in "activism through commerce," objectively creating the world he wanted to live in and refusing to acknowledge any false limits on his freedom. Unfortunately, federal agents in the Southern District of Iowa read a different book, and then threw it at him. The government compiled an extensive case against CHILLS based on sales to headshops in Iowa, charging Hill with heading a conspiracy to sell drug paraphernalia. The legal standard: He sold pipes to stores, and they sold those pipes to someone "likely to smoke marijuana."

The raids came less than two weeks after the terrorist attacks of September 11. Dozens of federal agents were involved, including a team of DEA agents flown down from Iowa for a taxpayer-funded trip to the Sunshine State. While their collegues scoured the country in a desperate manhunt for Al Qaeda "sleeper cells," these guys were busy protecting America from itself.

COMPLETE STORY IN MAY/JUNE 2004 HIGH TIMES
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