On this episode, Josh speaks with Jonathan Grzybowski, CMO and Co-Founder of Penji. They discuss, culture, processes, and putting your employees first.

Johnathan Grzybowski, is the co-founder of Penji. A platform that gives you on-demand access to the top two percent of designers in the world.

Penji has been named as a “top startup to watch” according to Philadelphia Magazine and acknowledged as one of the fastest-growing private companies in America according to Inc.

His mission with his podcast Blind Entrepreneurship and business is to empower the next generation of entrepreneurs so they too can execute their vision to profitability.

In today’s episode you will learn about:

  • Growing the business from zero to inc. 5000 in under 3 years
  • Creating a sustainable culture
  • Scaling and making mistakes along the way

Transcript

Narrator:             Welcome to “Cracking the Cash Flow Code”, where you’ll learn what it takes to create enough cash to fill the four buckets of profit. You’ll learn what it takes to have enough cash for a great lifestyle, have enough cash for when an emergency strikes, fully fund a growth program and fund your retirement program. When you do this, you’ll have a sale ready company that will allow you to keep or sell your business. This allows you to do what you want with your business, when you want in the way you want.

In Cracking the Cash Flow code, we focus on the four areas of business that let you take your successful business and make it economically and personally sustainable. Your host, Josh Patrick, is going to help us through finding great thought leaders as well as providing insights he’s learned through his 40 years of owning, running, planning, and thinking about what it takes to make a successful business sustainable and allow you to be free of cash flow worries.

Josh:                      Hey, how are you? This is Josh Patrick. You’re at Cracking the Cash Flow Code. Today our guest is Jonathan Grzybowski. I think I didn’t massacre his name too badly. He’s the CEO and founder of a company called Penji. It’s a really interesting company. I’m sure we’ll learn more about as the episode goes on, but I would love to bring Jonathan on and start talking with him about culture so we’ll do that.

Hey, Jonathan, how are you today?

Jonathan:            I’m doing fantastic. Thank you so much for the opportunity.

Josh:                      Oh, I love having you. Boy, you got a great voice for this. Thanks. Glad to have you here.

Jonathan:            I have a voice for radio and also a face for radio, too.

Josh:                      Well, no, I saw your face before we went black and you look just fine. That’s not a problem. You may have a face for radio of 30 years now, but not today.

Jonathan:            There you go.

Josh:                      Anyway, let’s talk about this. You have a really interesting company. If you do lots and lots of graphic design, which was a company’s do whether digital or in the real world.
We need designs and you have a great product. It sounds like you’ve really scaled it like crazy. It also appears to me that you put culture right at the middle of your ability to do this.

Jonathan:            Yeah.

Josh:                      Can you talk a bit about that?

Jonathan:            Sure. So something that we consistently say at Penji is that our team members, our employees are first and our customers are second.

Josh:                      I love that.

Jonathan:            Based off of our business model, you can probably assume that unlimited graphic designs, your first thought is that the people doing it are living a life that is filled with stress, and filled with just constant work ethic of 24/7. That’s actually not the case at all. We make sure that we manage our team members, their time, their attention, but at the same time, we make sure that they’re not overworking themselves. Again, it can be really easily done.

We’re managing that. We’re making sure that they’re aware that they’re first, the customer is second. It’s not necessarily to crap on the customers just to ensure that to our team and to our customers that our people are most important. Because what we believe is that if our people are mentally and physically sound, they’re going to be able to produce maybe 10, 15, 20 times the amount of quality work than that if they’re incredibly stressed and down.

Josh:                      This is something that I learned a long time ago is that your employees are only going to treat your customers as well as you treat them.

Jonathan:            Absolutely. 100% agree. We do some really cool things just to be able to help our team members during this time of quarantine. They’re all working from home. We’ve been pretty much remote company anyways, but just giving them the flexibility and just making sure that they’re safe, educating them a little bit more about how to stay safe I think is also incredibly important.

I love being able to have conversations. I have a conversation with the team member almost every single day just about their life has nothing to do with business. Because then again in my perspective, if you’re able to have those conversations and talk to them on a human level, when it comes time to actually reprimand them, or to provide feedback, they’re more willing to listen because they know that you care. They know that you had the best interest of the person and then they want to work harder just because they know that you care about them.

Josh:                      Are most of your employees, virtual employees, or do they actually come in? Are they freelancers? How does your employee structure work?

Jonathan:            Yeah, so we have a team in Philadelphia, which is where we’re located. We have another team, multiple teams scattered throughout the world. So we have designers and team members in both coasts of the United States, Europe, Asia, and Central America. For the most part, everybody is scattered. We use Slack, which is a communication tool in order to communicate and have those conversations.

I think the real culture, believe it or not, is actually inside of those channels, the camaraderie, the random memes, and things like that that happened and they happen far too often. That’s where the real culture begins.

Josh:                      So you’ve got people all over the world, are they full time employees or are they freelancers or a combination?

Jonathan:            Yeah, we were talking a little off air about like comparisons to things like that. For us, all of our team members are actually team members and employees. So you’re not working with random freelancers. Each team member has to go through a very strenuous test, that tests basically is then determining whether or not they can be a Penji designer. But even if you’re not a designer, and we’re looking to hire you, what we do is I think is pretty unique. Then this goes back to the culture thing is we asked a very simple question, what is your dream and how can we help you achieve it?

By us asking that question, it allows us the ability to understand the motives of this person. Is this person here just to collect the check which, you know, let’s be perfectly honest, it’s fine if that’s the answer, but then at the same time we hear other things like I want to provide a life for my family. I want to be able to make X number of dollars. I want to be able to help my community. Whatever those answers are, we now know the motivating factor and driving force for that person. It’s just a matter of us knowing that and then being able to be reminded of what that goal is of that individual when we talk to them on that on a consistent basis.

Josh:                      So I’m going to assume that you folks have stated values in your company.

Jonathan:            Yeah, but if I can be perfectly honest, we do have those values. It’s loose in the aspect that we’re not like most companies where we have like a creed or a credo or a Bible so to speak, but it comes down to like very loose terms, like just be a good person.

Josh:                      Okay. Do you have a clarifying statement around what being a good person means?

Jonathan:            I think it’s a little subjective. Of course, for me, it’s carrying about never making somebody feel less than. So whether that’s conversation, poking fun in a joke, making somebody feel uncomfortable when it comes in the world of graphic design, ego is very important. It’s also a huge driving force to quality graphic design. But if a manager is trying to provide feedback, because the customer doesn’t like it, it doesn’t necessarily mean that the design is bad.

It just means that maybe the person didn’t take other things into consideration when doing that. You have to be careful when it comes to that feedback. A good person to me is just being able to make sure that they care about themselves. They care about their family. They care about their community, and they also care about their team members by not making them feel like dirt when they come into the office.

Josh:                      I’m going to give some free advice because I can’t resist. I think having a great culture is the cornerstone of every great business. What I’ve learned over the years is that for example, a core value is be a good person. Okay? If you don’t tell people what that means they are going to make up their own definition of what it means.

Jonathan:            Yeah, sure, absolutely.

Josh:                      It also becomes a great tool. Because, as you mentioned, if somebody is going off the rails someplace, I want to have a good tool to bring him back on the rails again. I have a great story I call my Tanya story, but I’m not going to bore you with it today. It is essentially how did we get somebody to become personally responsible that wasn’t?

Jonathan:            Well, I wanted to read the values because while you’re talking, I was able to pull them up. Love thy customer. Give generously, be dependable, true to oneself in quality work.

Josh:                      Oh, cool.

Jonathan:            The reason why I bring up love thy customer, obviously, they’re the reason that we exist, but I want to highlight give generously. Something that we do, and we’ve done since the beginning. It’s actually one of the cornerstones of how Penji grew was we gave a ton of nonprofits in Camden, which is a very impoverished city in New Jersey it’s right across the bridge from Philadelphia.

We gave a ton of nonprofits, our services for $1 a month. We actually use that in order to grow the business. We ask them for referrals, and then they produce that. We’re constantly giving back to our community. We also hire kids from students, from a nonprofit called Hope Works. Hope Works basically takes kids from intercity youth and provides them education. Then we hire them once they graduate the program.

Josh:                      Great. So Jonathan, I’m curious how many employees do you have?

Jonathan:            We have over 100 of this plan.

Josh:                      Ah, well, that’s congratulations. That’s a huge company.

Jonathan:            Yeah, thanks.

Josh:                      Question I’m going to have here I’m going to switch gears a little bit on it because first I got to tell you, what you’re doing with your values and how you’re using your values is absolutely brilliant. Anybody listening to this podcast, you have just heard one of the best explanations you’re ever going to hear why you need to be a values led company. First thing you need to do if you build a great company, you have to have great values, in my opinion. I’m going to switch gears. Growing to 100, I’m going to bet you’ve gone through at least two or three or four iterations of dramatic personal growth. I’d be correct on that.

Jonathan:            Yeah, you’d be very correct on that.

Josh:                      I’m going to talk about one of my favorite things that I think that somebody builds a business for 100 people, there’s a skill you had to learn which is probably the hardest skill for any business owner to learn. That’s how to be an effective delegator. Could you talk a little bit about your path on that?

Jonathan:            Yeah. It’s not great to be honest with you even now.

Josh:                      By the way, is Jonathan is not great for anybody.

Jonathan:            That’s true. Very true.

Josh:                      I’ve never met anybody who did delegating well out of the box. Most of us do this so poorly. We almost put ourselves out of business.

Jonathan:            I can attest to that too. I think for me, the obvious things is that if you’re going to do something, the first thing to delegate it to the things that you’re that you’re not good at, I would say rather than give you a very obvious answer. I think one of the hardest things that I had to find is that when you delegate is that person set up properly and properly educated about the tasks at hand? Do they have proper KPIs in place in order to actually perform? I had to go through pretty much—

Josh:                      By the way, KPI stands for key performance indicator.

Jonathan:            Yeah, sorry about that.

Josh:                      Yes, so you’ve been doing really well with your jargon so far. It was the first one you missed.

Jonathan:            It is the measure of success. That’s the only in my opinion, that’s the only way that you can successfully hold somebody accountable. So for us, when you’re going through a process, I’m a very systems person. I’m not the visionary so to speak. I’m the person just like the architect, I guess you could say. For me, when you’re telling somebody what to do, do you actually have a clear set of guidelines that they need to read? Is it easily followable?

Like you can say, I had oatmeal today. How do you make oatmeal? If you can realistically tell somebody else how to make oatmeal from literally beginning to the end and not just the ingredients, so instead of saying, “Okay, go into cabinet and pull out oatmeal. Take half a cup, put it in and then take another half a cup of almond milk.”

What you didn’t know and this is a very silly example. But what you didn’t know is you didn’t tell the person where the oatmeal was inside of the cabinet so you have to be as granular as possible. I think that it took me close to a year and a half in order for me to understand how granular you have to be in order to delegate the tasks. The reason I say that story is if you are going to delegate, if you have to delegate, make sure that when you’re giving the task to somebody to be as granular as possible. You might have to read it 100 times in order to actually give it away to somebody. You have to protect it first before you give it away.

Josh:                      This is something which I find as really interesting when it comes to delegating, which is how do you deal with mistakes?

Jonathan:            Again, going back to the [inaudible 00:13:03] question, I’m terrible at this. I beat the crap out of myself when it comes to mistakes, which isn’t always the best things to do, of course.

Josh:                      It was not the best thing to do. I’m specifically referring Jonathan, to mistakes that others make as you’re delegating processes to them?

Jonathan:            Well, I think the first thing to do is to actually— going back again, I would say, blaming yourself to some degree, because if somebody’s not able to do something that you give them the task to do, there’s a strong inclination that that person is confused. It’s most likely due to your processes and procedures. So what I would like to recommend and what we do at Penji is we ask questions, of course, and not necessarily to the person because that can put them in a very high anxiety place of bind.

But more so what is the actual problem here? How did this problem happen? Is it a process driven error or is it just like a neglect from the individual? Was this person aware of what would happen if the neglect were to happen? I think it’s more so like we look at upon as the leaders of the company, we look at upon ourselves first in order to understand what the problem is and then being able to add on to the process if it’s not already there.

Josh:                      I mean, you’re doing all the stuff perfect. It’s not a big surprise that you grew your company to 100 employees in an industry where having three employees is considered a big company.

Jonathan:            Yeah, we’re definitely very grateful.

Josh:                      Well, gratitude is also another good thing that you want to be showing as you’re building the business. Frankly, I think that you’re really doing it well.

Jonathan:            I appreciate that greatly.

Josh:                      I think you need to be congratulated for what you’re doing. The thing that I’ve learned along the way, and this is counterintuitive for most business owners I ever talked to, is that our employees really don’t want to figure it out. They want to know specifically what the definition of success in their job is. The more detailed you can be about that, the happier they are. Has that been your experience?

Jonathan:            Yeah, a hundred percent. I can give you a very clear cut example of this. There was a young woman in our company had, I’d say, close to five or six jobs. We literally just kept moving her around because we didn’t understand what the right fit was. We would give clear guidelines. We would give what I believed was clear guidelines at least.

We would give her like the KPIs and we would find out that this person just couldn’t meet them. But we realized that it wasn’t necessarily her fault, because she’s incredibly hard worker and doing all the tasks, but maybe she just wasn’t fit for that particular job role and her personality didn’t fit to the previous job. Then we kind of changed course, I personally rewrote everything from the ground up when it comes to the teaching and the training.

Gave her this job based off of her personality and understanding her as a human being. Now she’s probably one of the strongest team members in our company and leads the customer success team at Penji’s. So that could be hopefully a good story for people to hear that it does take time and you might have to move things around and shake things up a little bit. As long as you’re clear, and the person is very understanding of what is expected from them, I think you’ll have massive success from whoever that individual may be.

Josh:                      My philosophical heroes in the business world is W. Edwards Deming, who is credited as being the father of process, improving quality control in the world. He’s the guy that helped Toyota develop what’s called Lean Manufacturing today, otherwise known as a Toyota production system. One of the things that Deming’s wrote in the early 80s, he probably wrote in the 30s was his 14 points. This was 1930s, by the way, and one of the 14 points is don’t blame the person, look at your system. It sounds like you’ve really done a great job with that.

Jonathan:            Yeah, that’s exactly it. Us as human beings, we’re told to abide by a certain set of rules and parameters that are given to us. Then we usually live within those means. So if something is broken, it’s usually because of that. Yeah, I couldn’t agree more.

Josh:                      I have talked to— well, we’ve been doing this podcast now for five years. I’ve talked to well over 500 business owners over the last five years, probably closer to 1000. I would say there’s less than 10 who are doing the stuff that you’re doing in the way you’re doing it.

Jonathan:            Well, I mean, that’s awesome. I think its ego too.

Josh:                      I mean, first of all you get you got to realize something, having 100 employees put you in the top 1/10th of 1% of all the businesses in the United States. I usually start my live seminars when I’m doing a live program saying, “Let me tell you something about business United States. There’s 28 million businesses and only 6 million of have any employees 300,000 do more than $5 million in sales $150,000 do more than $10 million in sales.” So if you’re in the over $10 million range, you are such a small percentage. It’s ridiculous.

Jonathan:            Yeah. Not that we’re successful by any stretch of the imagination because I think from a personal level and my co-founders perspective, this is literally just the beginning of our growth pattern. Once you get it rolling, you create something that people actually want to use and can benefit from. It’s just a matter of keeping it from there. I think to me, keeping success is a lot harder than gaining it.

Because you have that hunger in the beginning that is unparalleled to anything else that you can imagine because you’re constantly driving forward and doing things and pushing your body and your mind and your team to the highest level of a degree. Then when you have it, then you start to potentially become complacent, and that complacency can ultimately be the death of you.

Josh:                      Jonathan, we have time for one more question and I’m going to change subjects here. This is kind of out of left field, but do you have a coach?

Jonathan:            I do not have a coach, no. I have an opinion on that. Do you follow up question to that?

Josh:                      No, but I could have a zillion follow up questions if I butcher your opinion on it.

Jonathan:            So two things. One, I’m grateful that we didn’t have a coach because we’re able to find things and learn from things much harder than that is somebody telling us what to do or at least guiding us. The second opinion would be if we had a coach, there’s a strong chance that we could have found out all of the problems and the holes within our business much faster.

Josh:                      Okay. I’m going to just make a suggestion that we’re going to have to end it here unfortunately. I could go for a long time with you because you’re a really interesting guy, is that if you happen to ever look for a coach or what I call a thinking partner, or a mentor, is that you want to make sure the person who you’re about to hire is interested in you as a person and they do their coaching by asking questions, not by telling.

The reason for that is almost every advisor in the country will give you advice as if the company was theirs not helping you fulfill your dream. So if you’re going to hire a coach, and this is true for everybody who’s listening, the job of the coach is to help you fulfill your dream. The way they do that is by asking you great questions.

So Jonathan, unfortunately, I’m going to have to end it here. I would love to go on. We can have this conversation a bit later offline. How will people find Penji? They wanted to talk to you about what you’ve been done with your company, would you be willing to do so?

Jonathan:            Absolutely. So if you like our story, if you like what you’ve heard thus far, we didn’t even get into what it actually is, but head over to https://penji.co/. Hope you like what we felt.

Josh:                      If you’re listening to this podcast and it was foreign to it.  Go to www.penji.co.  It is a great site. I love the way it’s designed. I think it’s a really interesting business model. If you’re in an either graphic design these guys are certainly somebody who should be taking a serious look at. I also have an offer for you.

I have been obsessing for like a zillion years about what it takes for a business owner to become financially free from their business. The first thing we did, we developed this from years and years and years ago. It’s a little thing I use a yellow pad called the Four Box for Financial Independence. I’ve made it into a quiz. It’s really easy to get to you just go to thecashflowcode.com. That’s thecashflowcode.com.

One word and click on the big orange button. Takes seven minutes to answer a few questions. You’ll find out if you’re on the road to financial independence or not. So this is Josh Patrick, where it was Jonathan Grzybowski. You’re at Cracking the Cash Flow Code. Thanks a lot for stopping by. I hope to see you back here really soon.

Narrator:             You’ve been listening to the “Cracking the Cash Flow Code” where we ask the question, “What would it take for your business to still be around a hundred years from now?”

If you’ve liked what you’ve heard and want more information, please contact Josh Patrick at 802-846-1264 extension 102. Or visit us on our website at www.sustainablebusiness.co. Or you can send Josh an email at jpatrick@stage2solution.com. Thanks for listening and we hope to see you at Cracking the Cash Flow Code in the near future.

Topics: business culture, sustainable business podcast, Sustainable Business, culture, growing business from zero, growing business, graphic design business, jonathan grzybowski, putting your employees first

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