Identifying issues in the tattoo industry

Since starting out on the campus of Miami University in Oxford, Ohio, Mad Rabbit has been revolutionizing the tattoo aftercare market. The company is disrupting an industry that’s thousands of years old but has, until recently, resisted innovation. I met with Mad Rabbit co-founder Oliver Zak to talk about the company’s journey, its community-driven product development process, and a unique retail strategy that allows for a different approach to brand building.

Dave Knox: How did you come up with the idea for Mad Rabbit?

Oliver Zak: My co-founder Saerom and I started our business when we were sophomores in college. Saerom introduced me to the concept of e-commerce, and we spent the next six months exploring how to build a brand online. We started with dropshipping, where we learned valuable lessons about building a brand and differentiating ourselves through customer service and ambassador programs. Although we couldn’t compete on product differentiation, we learned how to succeed in other ways. A few months later, we sold the business for $7,000, which was a huge win for us as college students. It showed us potential interest in pursuing this business further.

During our senior year of high school, we were out of work and looking for new opportunities. We were booking tattoos and were frustrated with the recommendations we were getting for tattoo healing. Most of them involved petroleum jelly, which we felt was outdated and unhealthy. We asked our tattoo artists if there were any natural alternatives and they didn’t. So, Saerom and I decided to make our own natural tattoo care products.

We ordered ingredients from Amazon and local pharmacies and began experimenting with different formulations. Our first product was an all-natural tattoo balm made with seven natural ingredients. We used it for aftercare and it worked. By promoting these products through Facebook ads, we were able to generate $300,000 in sales that summer alone. In late 2021, we developed a soothing gel specifically for healing tattoos, and the brand continued to grow rapidly. This success showed us we had found a need in the industry and that product-market fit was feasible.

Saerom and I have learned a lot about brand building through our dropshipping business. The experience helped us gain the skills necessary to develop and sell our own natural tattoo care products. We are proud to offer a safer and healthier alternative to traditional tattoo aftercare and hope to continue expanding our business.

Knox: You launched both of these businesses while attending Miami University. How has this given you an advantage in connecting with your target audience?

Zac: Miami isn’t known as a particularly tattoo-heavy school. However, it has a strong entrepreneurial ecosystem that supports and encourages startups. Saerom and I were able to leverage this ecosystem to launch our natural tattoo care product business. Our recently launched University Ambassador Program focuses on metropolitan areas where tattoos are prevalent. This allowed us to reach a wider audience and build our brand.

One of the resources that helped us start our business was the business fraternity we joined our freshman year. This speaks to the amount of resources available on campus for those interested in starting a business. Outside of my finance degree, which helped me learn the business lingo, the biggest added value I brought to Miami during my time there was the entrepreneurial community of business school students, faculty, and alumni. This vibrant entrepreneurial community helped us launch our business. We are grateful for the resources and support we received from the Farmer School and the broader community, which helped us turn our idea into a successful business.

Knox: What is driving Mad Rabbit’s success?

Zac: I never thought I would be a tattooed guy, but I was good at spotting opportunities. Tattoos have been around for thousands of years, but I noticed they were growing in popularity. In 2012, only 20% of American adults had tattoos, but now in 2023, nearly 50% have them. That’s a lot of growth in a short amount of time. This trend isn’t just in the US, it’s global. Japan and South Korea just legalized tattoos, promoting self-expression through tattoos.

The tattoo industry has been prone to confusion. Historically, it’s been a cash-only underground business. There’s never been any formal training for tattoo artists, so they had to convince tattoo shops to let them train them. This made it a slow and exclusive community. Now, there are tons of resources available online, and Mad Rabbit is passionate about helping aspiring artists.

Mad Rabbit’s success came from solving a pain point in the industry: tattoos don’t always heal cleanly, and a big reason for this is the recommendation to use petroleum jelly. Petroleum jelly is great for scrapes and cuts because it helps scabs form and keeps out bacteria and dirt. It’s terrible for tattoos because it causes the ink to stick to the scabs, which then fall off and leaves your tattoo looking horrible two weeks later. That’s frustrating, especially after you’ve spent thousands of dollars and hours of pain on your tattoo.

We saw an opportunity to innovate and offer a better solution in tattoo aftercare. Our clean, natural tattoo care products resonated with people because they worked and addressed a real problem. We’re proud to offer a safer, healthier alternative to traditional tattoo aftercare and look forward to continuing to expand.

Knox: Why did you decide to appear on “Shark Tank” and how has it impacted your business since then?

Zac: It wasn’t me who applied to Shark Tank, it was my partner Saerom. I grew up watching the show with my family every Friday since I was 13 years old. My dad is an entrepreneur and I always knew I wanted to do something on my own one day. So when I got the call saying Shark Tank was interested, it was like a childhood dream come true.

Being on Shark Tank gave us access to a huge audience that wasn’t necessarily our target customer. The people who watch the show aren’t necessarily heavily tattooed, but they may have nieces, nephews, or grandchildren who are interested in tattoos. This is great for holiday gifting and overall brand awareness.

It was a great experience and I learned a lot from the Sharks. We were able to sign Mark Cuban, who was and remains a great partner to us. He was very supportive and helped us navigate the retail world. We are grateful for the opportunity Shark Tank gave us and are excited to see where it goes from here with Mad Rabbit.

Knox: Since launching your original healing balm, you’ve expanded into multiple products. What drives your product innovation strategy when deciding on the right products to launch at Mad Rabbit?

Zac: At Mad Rabbit, we’re proud that many of our product ideas come from our community. We’re an umbrella for different subcultures that are passionate about expressing themselves. We have surfers, chefs, hair stylists, tattoo artists, and more. All of these people come under the Mad Rabbit umbrella and connect with each other by sharing tattoos and tips and tricks.

What’s most exciting for us is being able to leverage the conversations that brands have with their consumers. Most of our products originated from ideas within our online community. We’ve had people asking for products like soaps and lotions, which is really exciting as they will expand beyond the aftercare period. It allows them to focus on the everyday care and maintenance that is so important for the long-term care of tattooed skin.

Many of the big CPG companies out there build products for the general consumer market and don’t see you as a market worth building for until the number of US adults with at least one tattoo exceeds 51%. But we’re small, agile, and we listen to our customers, so we can ideate and innovate accordingly.

Once we have an idea, we move into the prototyping and product development phase. We get samples from chemists and manufacturers. And then one of our final checks is to check with Dr. Elliot Love, who is a member of our advisory board. He’s a tattooed dermatologist and skin cancer surgeon. He’s a strong authority, and we can leverage his opinion from a scientific ingredient standpoint to make sure we’re getting the best possible end product, so to speak.

Knox: Your retail strategy is unique in that you not only sell direct to consumers, but also through Urban Outfitters, GNC, national tattoo shops, etc. Why did you take this strategy instead of going after the mass retailers initially?

Zac: We want to be present wherever our customers want to buy, including mass retailers, but our initial strategy was to only sell directly online through Shopify, Facebook and Amazon, which is how we’ve been able to reach 1 million customers today.

After gaining brand awareness, we started selling in “brand-enhanced” retailers like Urban Outfitters. Many of our customers are young, passionate people under the age of 35 living in urban areas, which is exactly the Urban Outfitters customer base.

We also saw an opportunity in the health and wellness industry — health-conscious people want to care about what they put in their bodies, what they put on their bodies, and they want their tattoos to look good, so GNC saw a great opportunity to move beyond supplements and into skin care.

The tattoo parlour channel is very important to us – it’s the point of care, it’s the billboard space, it sells our aftercare products when and where they need them, and most importantly, it gets the artist’s recommendation. Tattoo artists are the authorities on how tattoos heal, so getting their recommendation is very important.

In the tattoo industry, 51% of US adults have at least one tattoo, and tattoo artists are literally our bread and butter. There are also opportunities to sell to other segmented retailers, such as surfers, skateboarders, chefs, hair stylists, barbers, etc. Tattoos are a common bond that can be sold across different channels.

Knox: You recently raised Series A funding from Lucas Brand Equity, what are your business plans after securing this funding?

Zac: Part of the funding will be used to build out our field sales team. There are about 30,000 tattoo parlors in the U.S., which is a very important segment for us to capture. We’ve always been a digital-first brand, so building a large sales team is a new endeavor for us.

We are also looking to ramp up our content creation. This spring/summer, we will be opening our headquarters in Los Angeles, which will be a content-enabled tattoo studio. Our professional team of artists will be tattooing there, shooting 360 content, and providing product testimonials. We are also giving artists a space to document and grow their personal brand. This is a great opportunity to empower our artists and provide mutual value.

Finally, we are focusing on further product development. Currently, most of our products are consumer-facing, but we are also working on innovations to provide an even better tattoo experience for artists. This will go a long way in helping us gain recommendations for aftercare and daily maintenance.