This seems obvious from a retrospective: people with tattoos have unique skin care needs. But leave it to three fresh college graduates to see what no one else did and launch a direct-to-consumer skincare company for that audience.
That was in 2019, when Drew Fallon joined two of his University of Miami (Ohio) friends who had created a side hustle called Mad Rabbit. “We had a product, a social site, and an advertising channel,” Fallon told me.
Two years later, the company generated $3 million in annual sales—still as a side hustle. That’s when all three founders quit their full-time jobs, as Fallon calls it, the ultimate in tattoos.
He and I recently discussed the rise of Mad Rabbit. The full audio of our conversation is embedded below. The transcript has been edited for clarity and length.
Eric Bandholz: Give us a quick description of your company.
Drew Fallon: crazy rabbit The first direct-to-consumer tattoo skincare company. Our products help people’s tattoo ink stay vibrant and fresh for as long as possible. We offer an alternative to mass-produced products that are generally harmful to tattooed skin.
We launched as a side hustle in 2019, the same year my two co-founders and I graduated from Miami University in Ohio. We all had full-time jobs for about two years after graduation. During that time, we went from zero to $3 million in revenue with one product, one social site, and one advertising channel.
In the winter of 2021, we decided to do it full-time. We are all 25 now. We are early in our tattoo journey, and so are our primary customers. Many are 25 to 30 years old with tattoos. But tattoos can be addictive. People get one, and they tend to get more.
Bandolz: How do you reach $3 million as a side hustle?
fall upon: For one, my co-founder, Selome, cashed in on Instagram ads, which were our only paid promotions. He did an incredible job. Our first Google Ads came in 2021, the same year we had our first Amazon sale.
But it mainly came down to giving people something that didn’t exist.
Bandolz: You have gone from lifestyle brand to hyper-growth.
fall upon: We were making profit without paying the salary of three employees. By the end of 2020, we had completed filming on Shark Tank. We didn’t know it was going to air. We were in the process of closing a $500,000 deal with Mark Cuban. He is now our largest investor, having participated in subsequent funding rounds.
We launched our soothing gel in January 2021. It sold well. Then we created a sunscreen in March that went berserk. We sold 10,000 units in a week. At the time, we said, “This is a special occasion. We have two options. We can stay on the coast, or we can make the most of what it can become. “We went with the latter.
We are building a brand to be the best in tattoos – beyond skincare. But building a brand is expensive. It requires a lot of investment. We decided to go for it and faced very little competition.
Bandolz: I think most of your clients are women.
fall upon: Yes. That’s right – about 55% of women. Initially we had more male customers, but as we launched more products, our female audience grew. Women buy more skincare items. We’re going through a brand refresh now to tone down the masculine vibe. We are also switching to white packaging.
Tattoo culture is diverse. My 18 year old sister has three tattoos. Harley Davidson riders have many tattoos. Chefs are in tattoos, as are athletes.
Talking to each segment is an opportunity we haven’t grabbed. We all come to us as if they are the same. But we are hiring people with segmentation experience to create differentiated buying cadences.
For example, a woman may buy a balm and check sunscreen after two months. But a man will probably buy sunscreen first and then try a body wash.
Bandolz: You mentioned Facebook ads. How did Mad Rabbit react to iOS 14.5 tracking?
fall upon: In April 2021, about 85% of our marketing spend was on Instagram. When Ios hit that May, it felt like the train had derailed. We didn’t know what was happening. Our sales reflect not only iOS changes but supply chain constraints.
Fast forward to 2022. We are spending more money than ever on social but in better marketing efficiency ratio. Also we did two big pivots.
First, we struck an equity deal with Inked, an online magazine, for the services. He has around 60 million followers on his social media channels. They exclusively and aggressively promote our brand, products and content on those channels in exchange for part of our company. It exploded at the top of the funnel for us.
The second thing was Tiktok. In the last six months we have TikTok videos with over 20 million views and 400,000 followers. They have also generated a massive top-of-funnel effect.
With millions of views from TikTok and Inked, our Facebook Ads started working again. We expanded Facebook in January 2022, and we’ve been growing month by month since then.
Facebook now drives a lot of our sales, as evidenced by our attribution modeling. We take daily ads by channel and daily sales on our website and amazon and do a simple linear regression in excel. We can see that Facebook is still driving a ton of our sales, which includes Amazon.
Bandolz: Where can people follow and support you?