Jonathan Domsky – Why Great Leaders Never Stop Growing

But I pivoted to getting degrees in economics and Chinese and the

week that I graduated from college, I was on a plane with a

one way ticket to China. This was 1994.

Spent the next year and a half there and it changed the course

of my life. Our first SOP, we had an SOP

manual. The first SOP in the in the book

was when not to follow an SOP. You know, these procedures are

for 95% of our customers 95% of the time, but we don't want to

be rigid and, you know, follow rules when it's just obviously

destroying value. But by training on this, these

things, it helped people just know exactly how to thrive and

excel in their jobs. And it made them happier, it

made them more confident, made them more independent.

Hey there and welcome to From the Ground Up Show, the show

where we encourage and inspire the next generation of free

thinking leaders by telling the stories of those that have been

there, done that and are still getting it done, building a life

that they love with their hearts, their hands and their

hustle. I am your host Eric Loden.

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couple thresholds that I'm excited about today.

This is going to be a fun conversation.

I am joined by Jonathan Domsky, Co founder of Kidorable, a

company that transformed ordinary children's accessories

into imaginative products loved by families around the world.

What began in a small apartment in 1997 grew into a global brand

carried by thousands of retailers across more than 20

countries. Along the way, Jonathan built a

business rooted in creativity, quality and a deep understanding

of what delights both children and parents.

More recently, Jonathan has turned his attention to helping

entrepreneurs find greater clarity, purpose and fulfilment

through his work as the founder of Untangled Coaching.

Jonathan, welcome to From the Ground Up show.

I'm delighted to be here, Eric. Nowhere else I'd rather be than

right here with you. Let's get to it.

Awesome. Well I'm excited to hear all

about your business and the idea that this sparked A worldwide

brand. But before we get to that, we

like to learn a little bit about all of our guests going clear

back to childhood. So do you mind telling us about

what life was like growing up and and how does someone grow up

to have the type of creativity and drive that you have?

Eric had a very non traditional path to entrepreneurship and I

grew up in an upper middle class home with every opportunity on

suburban Chicago. It was also a physically and

unsafe place. And you know, I emerged from

that home with all sorts of things that on the one hand held

me back and on the other gave me the perspective, gave me the

drive to work at, to do the work that I've done and accomplish

what I've what I've accomplished.

You know, the biggest dysfunction that I carried with

me from my childhood is I was emotionally muted.

Like, I just wouldn't share anything like who I was or what

I thought or what I felt. Because if I did, you know, that

information would be used immediately to, you know, to

hurt me. And, you know, it was true at 8

years old. You know, it wasn't true at 28,

but it took me a couple decades to figure that stuff out.

But the, you know, as soon as I could leave home at 17, went to

college, started out studying engineering, thought I wanted to

be able to, thought I wanted to become an engineer.

Turns out I didn't, but I pivoted to getting degrees in

economics and Chinese and the week that I graduated from

college I was on a plane to a one way with a one way ticket to

China. It was 1994.

Spent the next year and a half there and it changed the course

of my life. Wow, why?

I want to hear about that experience, but I'm curious what

led to the decision to study economics and Chinese.

Did you have a particular career track in mind or or how?

Did you point out there if this was not a grand plan?

You know, University of Illinois, when you study

engineering, you study and you study engineering.

It's a very rigid program. And I just wanted a broader

education. I was lucky enough to have some,

you know, college credit going into school.

So I had a little flexibility. And I just thought Asia was

cool. You know, I didn't have any.

I didn't know anything about it, that it probably even knew any

Asian people. But I figured I could read, you

know, other stuff in myself, by myself.

So my freshman year in college, I took a course in East Asian

literature. And the professor's specialty

was ancient Chinese poetry. And that's what we spent the

whole class on. I just thought it was, that was

fun. So I decided to get a double

major in economics. I'm sorry, not engineering in

Chinese. And then after a couple of

years, you know, I like the science and math.

I just didn't like the engineering.

And I knew I wanted to drop out of that.

And I read the course catalog and I put a little check mark

next to every course. It looked interesting and it

surprised me. This.

There were a lot of checkmarks around economics.

So that's what I decided to major in, in my last two years

in school. You know, a regular course loads

15 hours, took 22 hours a semester, plus a couple of years

of summer school when I'm graduating in the four years and

went off on my way. No idea what I would expect, but

I was expecting to have an adventure and I did.

I was expecting to perfect my Chinese.

You know, my 20s spoke Chinese far more than I spoke English.

I was not expecting that. Three weeks.

Then I'd meet the woman I'd be married to for 29 years.

But that's what happened. And when I came back to Chicago

and she came to the US for the first time.

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We're used to spending all of our time together, like 23 1/2

plus hours a day. We wanted to be able to keep

doing it. We wanted to be able to go back

and forth between the US and China.

And it just seems like it'd be hard to do that with a nine to

five job and two weeks of vacation a year.

So I decided to become entrepreneurs, and I had no

background in business, but my parents are professionals, 100%

of their friends are professionals.

I was 2122 before I even knew that there were a million things

to do in this world and that being a doctor and lawyer were

only two of them. But you know, here we are, and

I, I wanted to change that. It wouldn't change anything

about it. It set me on a life of purpose

and abundance and wouldn't have had that same opportunity if I

wound up at a university or a think tank somewhere.

Yeah. So what was the plan when you

bought that one way plane ticket to China?

What what were you headed to China for?

What was the plan? Again, plan is a very ambitious

word, but I had at my Lonely Planet guidebook with dog eared

pages and all the places I wanted to see and I had a rough

itinerary of the places I wanted to go.

But the first three weeks I was in China, I hated it.

It was horrible. No one understood me.

I couldn't understand anyone. It's a very closed society.

It's very xenophobic, xenophobic place.

And I just felt like total, like just stuck out like a sore

thumb. I mean, I was taller than

everybody. It was whiter than everybody.

You know, just there was, it was just, I felt very alone.

And I remember I was on a bus and I met some British tourist

and I was telling him my story. And he's like really one way to

take it to China. Don't you think you should have

visited first before before deciding to, you know, do all

this stuff? And, you know, maybe that was

the maybe that was good advice. But you know, something that I

learned that life is a curriculum perfectly designed to

work out our purpose, just to look at whatever's happened in

our life and say, like, what is it that I need to learn?

Who is it I need to be? What's the action I need to

take? And I was ready to give up.

But the day after that low point was in this beautiful city

called Hangzhou, 1000 years ago. It was a it was the capital of

all China. It's a center of art and

culture. It's just beautiful.

And I wanted to rent a bike to just ride around the scenic

lake, but I couldn't find the place to rent the bike.

I guess my map was out of date. And I asked people on the

street. Nobody knew.

I walked into an office building.

I figure someone who works here, maybe they know where I could

rent a bike Happened to be the office where my wife, who 20

years worked. And as soon as she saw me coming

and I was like a falling star, like she had never met, you

know, any point when it wasn't Chinese before.

And she stood up and like she wanted to help and she didn't

know where I could rent a bike either, but she lent me her

bicycle and of course had to return it to her that night.

And they took her out to dinner. And seven months later, we were

engaged. Wow.

Wow, that is quite a story. So what did you end up doing in

China? Did you find a job while you

were there? What?

What did? You find a job to find an

apartment. I got a job in a small English

educational magazine focused on middle schoolers.

And my job was to be editor, writer and translator.

And yeah, for, for a year I worked in Chinese office and,

you know, just learn the culture, learn the language,

made friends, fell in love, got married.

And it set me on this path of entrepreneurship.

And I was just a couple months ago, I was with a group of

friends. All my all my friends are

entrepreneurs. We were having dinner together

and we were asking like, what's your story?

Like, how did you like, how did you become an entrepreneur?

And one woman told me, and this was pretty representative in the

group. She said that her father told

her when she was eight that she would never get a job, that no

one would ever hire her and that she had to be an entrepreneur

because she was just just this personality.

She had to do it her way. And that's a pretty typical path

to entrepreneurship is that just, we think we know how to do

things better than other people. We see opportunities that others

don't. We think a little bit

differently than most of our peers.

I was an accidental entrepreneur.

My my entrepreneurial story is a love story.

Oh, man, so you, you meet the love of your life.

You guys stay in China for a little while and eventually want

to move back to the US And that led to starting your own company

and your entrepreneurial journey.

Yeah. Was Kidorable your first foray

into entrepreneurship? Or did you try something else

first? No so kidorable was the first

foray, although it it changed a lot the first few months.

You know, I I very much just naturally have an operational

mindset. I see everything is a process.

You know, my wife and partner in the business, she's a creative

genius and an artist, you know, went to art school and just had

this real intuition about what excites kids imaginations to

become part of their play. But when so we came back to the

USI just, I got a job as a, as an administrative assistant to

just save a little bit of money. You know, I, I had to borrow

money for a plane ticket home. Like we started with nothing and

she spent the first year just learning English and like basic

computer skills and stuff like that.

I saved a little bit of money. And the next year we went back

to China. We talked to everybody we knew.

We went to some export trade shows and we came back with a

bunch of products that had nothing to do with each other.

Like we had pottery and silk scarves and decorative like

tabletop items. We also have had some kind of

fun 3D kids umbrellas and some cute painted hangers.

And we went to the Chicago gift show and the Chicago Apparel

trade show that summer and the kids stuff sold best.

So we decided that we were in the kids business.

And then within six months, we created this niche of fun,

practical, unique children's accessories, everyday items that

all kids need, but just do something fun and creative and

special with it so it excites their imaginations and becomes a

part of their everyday play. So rain boots, they look like

frogs and ladybugs or firemen or ballerina that kids beg to put

on when it's raining. Umbrellas that are 3D with

little ears that are, again, you know, frogs or ladybugs or, you

know, spaceships and stuff like that.

And then it grew, you know, and every year we'd add a new

product line. We'd add new styles.

We traveled the country going to trade shows, signing up

customers and most importantly signing up sales reps to do the

sales for us, and the company grew.

And so I know you said you're working as an administrative

assistant there for a while. Yeah.

At what point did you quit your day job and go all in on kid

orable? Yeah, this was not a gradual

process. The plan from the beginning was

to start a business because this was a love story and we wanted

to be able to spend all of our time together.

And while it was necessary for me to save $15,000 to seed money

to invest in the business and it was necessary for her to learn,

you know, English and to, you know, assimilate into US, into

US culture. But the plan from the beginning

was to quit and start that business.

So as soon as I think it was $15,000 that I'd signed up, we,

we were living in a studio apartment.

We cooked all over our meals. We were very cheap, saving every

penny we could because we wanted to be able to spend all day

together again. And yeah, so quit, Quit my job,

went to China, came back with all this stuff to those trade

shows. The first year we had sales of

$40,000 and we had expenses of $40,000.

We pretty much broke even living on almost nothing.

And we supported ourselves by doing craft fairs, sidewalk

sales, stuff like that. We, you know, on a week and on

the weekend we put out a, you know, put out a booth and, you

know, sell retail. That first year we rented a

kiosk in a local mall from August through through

Christmas. And again, it was just barely

enough to pay our bills. But that first year, again,

$40,000 of sales, $40,000 in expenses.

The second year we kind of figured things out and sales

grew to $400,000, the $100,000 profit.

Our next year sales grew to 1.2 million.

The year after that 2.4 million and you know we we topped out a

little over $6 million. Wow, wow.

And I'm sure probably everyone listening is familiar with your

products, even if they didn't know where that's where they

came from. We've all seen the the cute rain

boots with the frogs and ladybugs and things on them.

What was the most difficult thing you faced building that

business? What?

What was the hardest part? Yeah.

So the hardest thing was the Great Recession 2000 and eight,

2009 and it wasn't just that the economy was bad and sales were

falling, which which they did and we lost money for the first

time and that's never fun. But there were a lot of just big

structural things that were happening in the economy at the

same time. So we built our business as a

wholesale company working with small independent mom and pop

businesses. And those, the companies have

been going out of business slowly for 30 years.

And then they started going out of business really fast.

There wasn't a week that went by when we would get a letter from

a from a retailer, you know, from some local store saying we

regret to inform you that this is our 40th and last year in

business. This it just happened every

week. We were losing customers left

and right. At the same time, you know, the

Internet was really coming into it's own as a competitive force.

You know, these days everybody buys from Amazon, but you know,

2005 was kind of a new thing. You know, like, you know, a lot

of people still hadn't, you know, had that habit.

And all of our customers were feeling this competitive threat

from the Internet, from, you know, amazonmacys.com,

target.com, all these places and they wanted protection from it.

There were these huge, you know, just economic changes happening.

And a lot of retailers like they had a policy like if you sell

online, we won't buy your product.

And when we started our business, building them on the,

you know, building our business on these small independent

retailers, that was a viable business model.

But when they were going out of business left and right, there's

weren't enough of them left and they weren't buying enough that

we could, we, we could continue to, to thrive on our own by

protecting them from what was happening in the wider economy.

And we struggled for a long time.

We, we resisted working with big customers like Amazon and

Macy's. We tried to protect them from

competitions from each other. Like we wouldn't sell the two

retailers in the same zip code until I was listening.

I was listening to an interview with Bill Ford.

He was the CEO of Ford Motor Company.

And someone asked him, you know, Ford was an early investor in

Zipcar, you know, where you could, you know, car rental.

And the interviewer, interviewer asked him, like, aren't you

afraid that interviewing in Zipcar, it's going to

cannibalize your business? And this was before Uber and all

that sort of stuff, but triple you could say that about, you

know, ride sharing. And Bill Ford said, I'll never

forget this. He said, it's happening whether

we like it or not. So we may as well like it.

It's happening whether we like it or not.

So we may as well like it. And I came back from that.

I'm like, you know, the internet's happening whether we

like it or not. These companies that we built

our business on, who we love, they're going out of business

whether we like it or not. So we may as well like it.

And that was our pivot 2 years too late to selling direct to

consumer on cadora.com, our own direct to consumer website,

embracing Amazon, embracing the big box stores.

You said pretty definitively they're two years too late.

Yeah. What did that pivot look like?

What? What did being late to the game,

how did that hurt? You well, it hurt us because we

lost half $1,000,000. So that was the first thing.

That was never fun and it's a hard pivot.

You know, we had to lay a few people off.

We had to cut expenses, we had to cut some salaries for while

we were turning things around. The hardest thing, though,

wasn't even that, I mean, that was hard.

It's never fun. The hardest thing was just

between our ears. You know, we'd, we had this idea

that we built this business on partnering with our friends

with, with, you know, people We'd come to love these

independent retailers. And there came a time where the

business just wasn't there anymore.

It was, I mean, we could nobly go down with the ship, but that

wouldn't serve anybody. And took us months of meetings

just figuring out how are we going to do this?

Are we going to do this? How are we going to communicate

it. It was really hard.

Eric had a lot of sleepless nights and a lot of tough

conversations until we committed to, you know, Kodorova was a

values based organization and we had three core values.

And the first one was that we have the courage to do what's

right. For ourselves, the company and

our customers. And it was a false courage to

protect independent retailers against the world, because that

was impossible. And the real courage was to face

reality, face the brutal facts, and to make a choice.

But it took us a long time to figure that one out.

Yeah, that can be hard when something that's such a key part

of your identity has to change and shift and.

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ground up show. Although I'll tell you another

story, you know, another one of our core values was safe,

supportive, positive environment.

And when we first, you know, we, you know, 10 years before this,

we got our first major account, Marshall Fields here in space in

Chicago. They were later bought by Macy's

and then, you know, Target, but they're our first major account.

And they required that we use something called EDI, Electronic

Data Interface. It's this big, expensive,

clunky, complicated system that big companies use to streamline

their ordering and their payments.

But for us, it was just pure hassle and expense.

Like, it cost us thousands of dollars and just a lot of time

to figure it out. And I asked her, IT guy or IT

consultant who was sitting up for us, it was Doug.

I said, Doug, what would have to be true for me to say, thank

goodness the EDI exists because right now we really hated it.

And he said, well, if you ever get enough orders from large

retailers that it actually saves you time and money to automate

it versus, you know, having someone to do all that manual

data entry, then you'll be really happy, really happy to

have it. Well, it took 15 years, but we

got to that point where we were getting hundreds of orders a day

from Amazon, from Macy's, from people like this.

We had a, we 2 full time people. So all they did was data entry

for these major accounts. And not only that, but Amazon

started tightening their time windows.

We used to have, we used to have five to seven days to ship,

which you know, took two days to do the data entry and then we'd

pack it and you know, we'd get it out in five days.

They changed it so that we had to ship within two days, which

was just impossible because it took two days just for the data

entry. So I called up Doug and I said,

Doug, we need to automate this EDI thing.

What's it going to take? And he said three months and

$50,000 to for meeting new servers and equipment, software

and all that sort of stuff. And through no fault of their

own, that meant that two excellent beloved employees

would be losing their jobs. And if we didn't do this

investment would have they would have lost their jobs anyway

because we would have lost the customer because they were, you

know, they were, you know, tightening their requirements.

And I talked to my friends about how I should handle this.

And they also doing the same thing.

They said don't tell them, keep them in the dark, wait until the

system's in place and then give them a couple months severance

and tell them, you know, that their jobs are gone and that's a

safe thing to do because we have a company to run and it was a

busy season. And if they quieter, you know,

because, you know, I gave them three months notice that they

were going to be losing their jobs.

That would have really put the company at risk, but it would

have also violated our core values.

Having the courage to do what's right for ourselves, our company

and our customers and a safe, supportive and positive

environment that these people just got hit by lightning when I

knew it was happening, you know, three months in advance.

So a week later, call them into, you know, our conference room,

box of tissues on the table, severance checks in hand,

glowing letters of recommendation.

And I told them, like in two months, you know, here's what's

happening and you're going to lose your job, your job's going

to be eliminated. And I really hope you stay to

the end of the year. And I'm giving you the dress

severance check right now, like you could leave tomorrow and

it's yours. But I hope you stay for another

two months to see us through the end of the season.

And you know, if you ever need some time to do an interview or

whatever, go ahead. But I chose to treat them with

humanity. I chose to be true to our core

values. And one of them stayed until the

week before Christmas, like right through the end of our

season, found a job that was closer to home that actually

paid more. So she turned out great.

The other stayed until the end, found a job two weeks after, you

know, she left us, same thing, you know, closer to home, making

more money. And everyone was watching.

Everyone saw how we acted in this, you know, environment

where we had a choice between circling the wagons, acting in

our narrow self-interest or doing what's right and believing

in our values. And, you know, did we do this

because it was a smart decision, business decision?

No, we did it because it's who we are.

But, you know, being true to your values and everybody's seen

that and knowing that they could trust you and depend on you,

it's just good business sense. That had to be a difficult

discussion and a difficult thing to work through.

At what time during your leadership of your company were

you most afraid? So, you know, I told you when I

started, I had no business, I had no background in business,

and I didn't know anything starting over, starting out.

But the definition, the job description of being an

entrepreneur is to figure it out.

You know, all of my entrepreneurial friends, no one

would have hired us to start our companies.

Like like like nobody. There's, there's, I don't have a

single friend who waited until they were ready and they knew

everything before they started their business.

Like everyone started having no idea what they were doing.

You know, maybe they had a good idea, maybe they had a little

bit of background in the field or whatever.

But the, the job description has to figure it out.

And I had a lot of figuring out to do you know, Eric, I, I tell

people I'm only naturally good at one thing in this world.

And it's learning. Like there, there's almost

nothing I've ever tried in my life.

We're just right out-of-the-box. Like, like I'm kind of good at

this. Like, no, I've been bad at

everything I tried. And then I learn and I try and

then, then, you know, my, I have a, a mastery mindset where I

just want to, you know, become an expert in something.

But I was a terrible manager when, when I started and I

wouldn't communicate clearly to my employees.

So of course they wouldn't do what I asked them to do or what

I wanted them to do rather. And you know, they would make

decisions without, you know, cuz I, I wasn't particularly

approachable or, you know, available and they make

decisions I didn't like and I would, I wouldn't feel

comfortable like telling them. So there's all this drama that

was happening inside my own head and it was just, the whole thing

was just, this is a terrible manager until I 2001 when I read

a book that just required reading for anyone who manages

people. It's called The Five

Dysfunctions of a Team by Pat Lancioni. 5 Dysfunctions of a

Team by Pat Lancioni. And what Lancioni teaches is

that at the root of all dysfunction of a team is a lack

of trust that people don't trust each other.

And when you don't trust that someone's going to be able to

receive bad news or, you know, a question, well, then there's a

fear of conflict. You know, they're afraid to tell

you that the emperor has no clothes.

They're afraid to tell you when something goes wrong.

They're afraid to tell you when there's a mistake.

And when there's fear of conflict, there's no commitment

because the, you know, the entrepreneur, the boss says, OK,

guys, here's what we're going to do.

And the employees think, well, that's a dumb idea, but I'm not

going to tell him because he's just going to bite my head off

or he's going to dismiss me or, you know, make me feel stupid.

So, you know, I never agreed to that.

So there's no commitment. And when there's no commitment,

then there's no accountability. You can't hold me accountable

for something that I ever even agreed to.

And then when there's no accountability, there's an

inattention to results. You know, we wonder at the end

of the day why we didn't reach our goals.

And it's because there was the absence of trust that led to the

fear of conflict that led to the, you know, lack of

commitment and the lack of accountability.

And I remember just sitting in my office and, you know, in

spite of all that, somehow we managed to, you know, have some

success with sales and profitability.

But I just remember sitting in my office being afraid to talk

to my employees, afraid to confront them with the the stuff

that was bothering me. And I read this book and it

changed my life. And I called a company meeting

and I told them I apologized for all the idiotic things I was

doing as a manager. And so from now on, we're going

to start doing this stuff. And I started instituting

processes, starting with the daily huddle every morning,

everybody in a room standing, meeting, literally standing

because you don't want people getting too comfortable and

sitting down. It's a 5 minute meeting.

We don't want it to be 1/2 hour meeting.

It's yeah, it's a 5 minute meeting.

And there's only three things on the agenda.

What are you expecting to happen today?

What are you expecting to happen this week?

And where are you stuck? And need help so that everybody

knows what's going on. Everybody knows what's expected.

And together with just having the courage to listen and the

courage to be clear. But what I actually wanted

changed my life. Just beginning to institute

those systems, and that's when we started really scaling

instead of scrambling. Well, I know a lot of

entrepreneurs, especially kind of in your space, they start

with the product, focus on a product.

It sounds like you built far more than a product.

I can tell you really care about your team.

You really built a business and focused on the processes in the

business. Did it?

Was it always that way? Did you kind of start with a

product and learn that along the way, or how did that happen?

You know, I, I have this operational mindset.

I just, life is everything in life is a process.

And I remember talking with sales guys or designers and you

know, artists and they'll say, well, it's really art, more art

than science. You can't really, you know, you

can't really define the steps and it's just wrong.

Like if you say it's more earth than science, it just means that

you don't know what the process is.

It's subconscious. And I would talk to my, my

friends teased me that my love language is Sops standard

operating procedures that just like why if you have 5 people in

your company, why would you have them all doing things a

different way? Why would you have them

practicing on their on your customers instead of practicing

in a training meeting? We built a customer service

training manual over six months, 15 minutes a day.

We are our customer service team.

I would lead a 15 minute daily training meeting after lunch.

And one day I remember just getting frustrated that someone

just responded to a customer service issue just in a way that

was just so obviously not a good way to do it.

And then she was a smart person. She was doing her best.

Like she cared about the company.

She cared about the customer, just wasn't, you know, just

wasn't our finest moment. And I said, let's just make a

list. What are all the things that

could go wrong in our company with regard to customers?

And over the course of just a couple of these 15 minute

meetings, we made a list of 70 things that could go wrong.

UBS could lose the package. It's not our fault, but they

lost the package. We need to deal with it.

We can forget to process an order.

We can ship ladybug umbrellas instead of frog umbrellas.

Just like all the stuff, right? And OK, we've a list of 70

things that could go wrong. And then one at a time over the

next six months, every day we'd choose one or two.

And I'd say, OK, UPS lost the package.

What do we do about it? And one person would say, like,

well, like, that's not our fault.

We should just, you know, we should just repack the package

and get it, you know, send it to them and they'll get it a week

later. And that's just what makes

sense. And someone else said, well, you

know, it's not our fault, but it's our responsibility.

Like the customer, they're depending on us and they needed

it for a Sally. We should overnight it and we

should just eat that expense. We won't make any money on that

order, but it's the right thing to do for the customer.

And we just do this over and over and say, which of these is

most consistent with our values? Which of these is most, you

know, consistent with growing the company.

And we'd agree, you know, everyone in the department would

agree, like, Yep, that's the best way to do things.

And we'd write it down. And then we trained on it.

And our staff were so happy because they no longer had to

guess, like they just knew how to be excellent at their jobs

and they knew that they didn't have to ask management.

They knew they could just make a decision on the spot because

they were trained on it. Like they knew what to do.

Our first SOP, we had an SOP manual.

The first SOP, man, the first SOP in the in the book was when

not to follow an SOP. You know, these procedures are

for 95% of our customers, 95% of the time, but we don't want to

be rigid and, you know, follow rules when it's just obviously

destroying value. But by training on this, these

things, it helped people just know exactly how to thrive and

excel in their jobs. And it made them happier.

It made them more confident, made them more independent.

And yeah, even for our salespeople, even for finance

team, you know, they would just say, like, yeah, I just look at

it and I know what to do. And my gift is to ask these

questions that draws out those subconscious processes and like,

OK, here's a question that you're asking.

All right, ask this question and then we could train someone who

it didn't come naturally. To man that's wonderful.

I love that first SOP. It's like the anti bureaucrat

rule. Yeah, yeah.

Nobody likes to follow a rule just because it's the rule, even

though it's obviously not applying to the situation.

And when we hired people and on the first day, we'd say, like, I

hired you because you're smart and I like the way that you

think. And we want you to use your

brain at work. Having said that, here's what

we've found is most of the time the best way to do things.

So we'd like you to learn this. And you know, if you run into a

situation where following the SOP is not in the customer's

best interest, all I want you to do is ask yourself, is it, is it

the right thing to do? Is it legal?

Is it going to serve the customer?

And are you willing to take accountability for it?

And if you are, go ahead. No one's ever going to get in

trouble with that. I'll one more fun story.

And this, this transformed our company.

So every quarter we would have a quarterly strategic planning

meeting. We'd bring in our management

team and we'd talk about what was the most important things

for us to focus on this next quarter.

But we'd start by reviewing our core values and our purpose.

And we'd read them aloud and I'd ask for examples of when we

really love this thing because it's easy to say like, Oh yeah,

stay supportive in a positive environment.

Like pat ourselves on the back, like, yeah, this is a great

place to work. But is it really?

Like if you think of real examples where we actually

supported each other, do you think of a real example where we

actually, it spread positivity because if we can't, then it's

not real. And then I asked the opposite,

the opposite. Is there any time where we fell

short? And we went through this for

about 15 minutes and everybody was, you know, feeling pretty

good. And we were about to move on

when my office manager raised her hand and she said, you know,

frontline staff are afraid to make decisions.

If it's outside of the SOP, they're afraid to make

decisions. And even if they know what the

right answer is, they come to me, you know, the office manager

and ask for permission. And it's a violation of all of

our core values. It's a violation of having the

courage to do what's right. It's a violation of a safe

environment. The other one was a commitment

to, you know, to excellence. So right then and there, we made

a quarterly goal that for the next three months, staff is not

allowed to ask management for direction.

That whenever they encounter a customer challenge, they just

need to solve it right then and there.

And if they do come to management for, for guidance

that the answer will be do anything's best.

Tell me about it in the next weekly meeting.

And then a week later they would say, like, oh, this thing

happened. Here's the decision I made.

Like, what do you think? And most of the time it would be

fantastic. That's exactly what you should

have done. Or it would be, oh, not bad, but

next time try this or what a fantastic opportunity for

learning. This is what we're going to be

doing next time this happens. But it's a relatively small

stakes things. But again, it transformed our

company because it made people understand that we actually

trusted them, that we gave them the tools, that we believe that

they have a, you know, a good head on their shoulders.

That's why we hired them. And they have the agency to make

decisions. And it freed up hours and hours

of management time because, I mean, managers don't like to

answer questions that their staff know the answers to.

You know, it takes them away from, you know, the value that

they really add. And it just gave people agency

on autonomy and just the sense that we trusted that they knew

what they were talking about and that they were good at their

jobs. It sounds like a fantastic place

to work. Newer values based company, you

know, the nobody needs guidance on whether it's better to make

$1000 or $100. Like everybody knows the answer

to that question. Nobody needs guidance and is it

better to get a hug or to burn your fingers?

Like everybody knows how to answer those questions.

But you know, just using that example I used earlier, UPS lost

the package. Like should we lose money on

that order or break even to pay for to ship it overnight?

It wasn't our fault, but should we still spend that extra $100

or should we say like, yeah, that sucks for you retailer, You

know that they lost the package. We'll send it out in a couple

days and you'll get it a week later.

It's a values based decision. It's not an analytical, logical

decision. And the only way to get your

staff to make the same decisions that you would is if they know

what your values are and that you train on your values and you

reward people for living your values.

Good stuff. There's a lot of wisdom there.

You admittedly said you had very little business knowledge,

business experience starting your company.

Yeah, I think that maybe is one of the keys to the success you

found was finding your own way to do it in this values based

business and valuing people. I noticed when when you were

describing starting your business and kind of the

products you made, you lit up, you got excited, you used the

word imagination quite a few times.

And So what part of your company's success do you think

came from understanding emotions and imagination rather than

understanding retail and business?

Yeah, so, and I think this is just the general truth.

If you start your business just trying to figure out how can I

make a buck, there's nothing inspiring about that and no

one's going to want to follow you.

You can't have as an overworking company goal.

I want to make $1,000,000 and retire by the time I'm 40.

Like, no, nobody's going to follow you.

Nobody's going to say like, oh, that's what I want too.

I want you to be able to make $1,000,000 and retire by the

time you're 40, Eric. I want to devote my life to

that. It's just, it's not inspiring.

But when you know what you care about, when you know what lights

you up, when you know what makes you special and then you follow

that. Like everybody loves that.

I mean, not everybody, of course, but you know, we wanted

to make our customers happy like we and in, in every sense, the

professional buyers we worked with, they want, we wanted them

to hang up the phone thinking like, you know, that was the

best call I had all day. Like those guys, they were fun.

They were, you know, they were, they were, they were excellent

at what they do. They made me smile.

The parents who bought our products, we wanted them to see

their kids light up and play with the rain boots and their

umbrellas or whatever it is and just be excited that they were

doing something really fun and joyful for the kids.

And then of course for the children who were the real users

of our products, they wanted to excite their imaginations for it

to become an every part of their everyday play and every decision

that we made about new products it I mean, yes, we wanted to, we

wanted to sell, yes, we wanted it to be at a reasonable price

point and all that sort of stuff.

And. You know, those are table

stakes. Like you can't run a business if

it doesn't, you know, meet those criteria.

But we just didn't develop products that didn't excite

imaginations and become a part of everyday play for a very

practical, essential product that everybody needs.

Those were the only products that we would create.

And when people came to us, that's what they were looking

for. You know, could we have sold

Beanie Babies? Probably, you know, could we

have, you know, just made a plain rain boot that was, you

know, perfectly utilitarian? Sure, but nobody's looking for

us for that. They were looking for fun,

practically unique children's accessories.

I'm the only one who would use those words because it's kind of

a mouthful. But they knew it.

They saw it in our catalog. That's what they expected from

us and that's what we added to their stores.

That's fun. So what advice would you have

for a business owner that has lost their way there, that is

kind of stuck in the I'm, I'm here to make money, I'm pushing

to retirement and has lost that inspiration, that excitement.

How do you come back from that? Well, so first I want to say

it's very common. It's extremely common that

either we stumble into a business, I certainly stumble

into my business, or we did start with a mission.

But then, you know, just things happen and, you know, your major

customers says, hey, can you do that?

And you're like, yeah, we could do that.

And just the company becomes something that is unrecognizable

and the goals that drove you to get where you are right now,

they just no longer excite you. And maybe they don't excite you

because you're losing money or it's just a, you know, it's

frustrating. Maybe the business is very

successful, but just your heart's not in it anymore.

And my answer to all those people who are in that situation

is there's still an ember. There's still a spark alive in

you. And it doesn't take that much to

reawaken it. And your purpose, your why?

Well, let me back up for a second.

What? What does it mean for your

coming to have a mission? What does it mean for your

coming to have a purpose? Your purpose is how you feel

compelled to contribute to the world because that's who you

are. The intersection of that with

the impact that you seek, that just makes everything feel the

way it should be. You might love what you do, you

might be great at it, and you might make a lot of money, but

if it's not in alignment with your purpose, it just feels

empty. In contrast, when you're doing

what you feel you were born for, you just wake up every morning

and you're like, yeah, and this is what life's all about.

It gets to do it all over again. And the shift and it doesn't

mean you have to start a new business, doesn't mean you have

to start over anything like that.

The shift is just to get really clear about why you do this.

And your why is hidden in your stories.

The way to find your why is just to ask, when I started this

business, like, what was I trying to accomplish?

You know, I, I, I had a client who ran a small chain of Tex

Mex, Tex Mex, Tex Mex restaurants.

There's a million in Austin, TX. There's a million Tex Mex

restaurants in Austin, TX. But why did this one have to

exist? That's the question.

And the people who founded the business, like what were they

trying to accomplish? Everyone who works in the

business, whether it's a bartender or a server or a

busboy or, you know, and someone in the kitchen or anything else,

think about your memories at work.

The ones that to have emotional high points that you just

thought, you know, that was a really great day.

I felt so good about that. Or the opposite, Like I never

want to experience a day like this again.

That was a terrible, terrible day.

The ones that light us up, it's because they resonate with their

purpose. The ones that really frustrate

us, they were a violation of our purpose.

What was the opposite of that? And if you tell enough of these

stories, you know, 5/10/12 of these stories, you start looking

for the themes, things will start to come out that you look

at the themes, the ones that keep repeating, the ones that

make you cry out, yes, that's who we are.

And then you write a purpose statement around in my old

company, Cadurable, the company's purpose, very unusual

was that the company was a vehicle for personal and

professional growth for everyone who worked with us.

And that's everything we did. Like, you know, I said we had a

15 minute daily training meeting for our office.

We had a weekly sales training meeting.

We had, you know, I had, we topped out at 28 employees.

I had two hour quarterly reviews with every single staff member

helping them use the company as a vehicle for personal and

professional growth inside and outside the company to, you

know, to, to achieve their goals.

Like that's what animated us. For another company, it would

have taken a superhuman effort to do all that training for us.

It was, it was just like breathing because it's what

animates us. And was it a good investment?

I don't know if I would have started a business telling

everyone who's listening. Like, yeah, you have to do 2

hours of trading a day if you want to succeed.

No, probably not. But when you invest in your

people, well then you grow your people and your people grow your

business. So what is it for?

You I mean. Find your purpose and then

double down on that. Design your culture, design your

products, design your processes to be further aligned to grow

your purpose. And it's a it's a very reliable

path to growing your business in a way that's fun.

There is. There's a lot of wisdom there.

I hope our listeners are listening closely.

I know a couple weeks ago we had a guest on that was an inventor

and wound up in some pretty heated legal battles about

patents and knock offs and copycats.

I can imagine that you've probably faced the same thing,

being kind of shaking up this industry, bringing a new product

to market, but one that is probably easily copied.

Yeah. What role did that play in the

growth of your business? How did you handle that?

What advice would you have for somebody facing similar

difficulties? Yeah, it was a real challenge.

You know, between we founded our company in 1987 and between 2001

and 2006, we spent half $1,000,000 in legal bills for

intellectual property protection.

It was all defensive. People would not cover products.

And especially when you're the artist, when you're creating

something, it just, it hurts to know that you spent all this

time, you know, creating this thing and then someone else just

goes off and copies it. And there are some legal

protections, you know, copyright, design patents or,

you know, product utility patents, stuff like that.

But they're all expensive. They're all slow.

And I can tell anyone who's listening, the law is a very

blunt tool to to do these things.

We felt it was necessary at the time.

It was took so much out of us by the end.

My, you know, my, my, my lawyer told me that I've had a very

expensive legal education that it cost me half, $1,000,000.

You know, it cost him only a couple $100,000 to learn all

this stuff about intellectual property law.

But a great outcome would be that we would sue someone.

We'd get them to stop and we'd only lose a little bit of money.

We had a couple wins where we, you know, got more money then,

you know, then we lost. I mean, we sued Disney.

We sued all sorts of people who would, you know, who knocked us

off. But almost always it was just

stressful and a distraction from the real work that we needed to

do. And at best, we broke even.

And at the end of the day, they were just able to tweak the

designs. And, you know, it wasn't exactly

the same, but it was, you know, pretty close.

And a lot of customers couldn't tell the difference anyway.

So I had to do it all over again.

I don't think it would have sued anybody.

I would have just spent all that time and money investing in out

innovating our competition. Cuz we're creative people like

we like to, we like to innovate and all these things are a

distraction. They just take time away from

doing what we do best. The reason why people wanted to

copy us in the first place. Yeah, if everybody's copying

you, by definition they're always one step behind.

So yeah, yeah. But this slowed us down, so it's

easier for them to get a little bit closer.

Yeah. You grew this company pretty

substantially. You started bootstrapping it

with, you know, living on almost nothing and grew it to be quite

a successful company. What was your approach to

capital reinvestment? What did that look like?

And at what point were you're able to finally start reaping

some of the benefits of the work that you'd put in?

Sure. Well, I'll say what we did and

then I'll say what I wish we did.

So what we did was, you know, I said that the the purpose of our

company was that the company is a vehicle for personal and

professional growth and that we don't really owe the company

anything. Like the company is a tool.

It's a tool for us. It's a tool for the people we

work with. It's a tool for the people we

serve. But for a lot of years, if the

company needed money, you know, the company got that money 1st

and we, you know, we would live off the scraps.

And, you know, it's fine. We did all right.

And you know, in the end, you know, it all worked out just

fine. But I think we need this.

They suffered for the business, but it just wasn't necessary.

And I think if we were a little bit, if I had a coach like me

telling me 20 years ago that, you know, hey, Jonathan, the

purpose of your company is that it's a vehicle for personal and

professional growth for, you know, for us or customers,

everyone who works with us is the, is the company serving you?

Like, is this a ride that you want to be on?

And especially for the times where you're losing money, we

were sacrificing a lot for the company.

And I think if I'd taken the time to really answer that

question, like, what does it mean for the company to be a

vehicle for my personal and professional growth, we would

have made some different choices.

We would have either chosen to grow a little bit more slowly,

so we would borrow a little bit less money and there'd be less

stress. We would have maybe borrowed

more money because we would have used other people's money or,

you know, found an investor or something instead of, you know,

plowing all of our hard one profit, you know, back into the

business growth. Or we would have made some

harder choices. And, you know, when we did have

to make cuts, cut a little bit deeper.

I have a great friend. We've known each other for 25

years and of course we've had the same ups and downs with the

economy. But I remember when the, during

the Great Recession happened, we lost money for a long time.

And he just told me I'm not losing money.

I'm not very aggressively people leases, you know, just, you

know, just trying to lower his, lower his costs.

And again, he had a different, different set of values and all

that sort of stuff. But, you know, I don't think

there was ever more than three months where he lost money even

during very difficult times because he just made clear

headed tough decisions. And he's since grown and, you

know, been able to hire all these people back and and more.

It's not obvious to me that it's the kind decision to for the

entrepreneur to suffer and for to, you know, lug the zombie

along until, you know, until things turn around.

Sometimes it's kinder just to make a clean cut.

I appreciate that perspective and that honesty and that's a

lesson I think a lot of entrepreneurs need to hear and

and you get to express that from the other side.

So thank you. It's no fun to, it's not fun to

fire people, and certainly no one should ever take any joy in

it. But when you're propping up a

zombie like it just needs to die and it's not doing anyone any

favors. Pain that is prolonged is pain

that's multiplied. Yeah, that's good.

Every time you walk across, you walk down your Main Street and

you see this and you see a store that's closed, that's the death

of somebody's dream and it's sad.

And almost every time I bet you they should have closed six

months earlier. Yeah, yeah, absolutely.

You don't have to fly the plane into the mountain to, you know,

like that's, that's not, that's not a preferred exit strategy.

No, no. So I know you said you started

the company. You and your wife wanted to

spend all your time together, do something together.

Yeah, but entrepreneurship is not an easy path.

It takes a lot of time, a lot of energy, a lot of effort.

I heard it said entrepreneurs are the only people on earth

that will work 80 hours to avoid working 40.

Yeah. How did that plan work for you?

Were you able to spend the time you wanted with your wife?

Was this something you guys could do together?

What did that look like? So the first two years we were

in business, we were working 80 hour weeks and we would take

half an afternoon off once a month in order to, in order to

build this thing. And then we started hiring our

first employees and, and, and then, you know, the promise of

all that hard work, you know, paid off.

But there were two things that we didn't expect that I, that on

the one hand, I wish people had told us and on the other people

told us, I probably wouldn't have listened to.

But nonetheless, here is the advice that I would say anyone

who chooses to work with their spouse, you don't have a

business life and a work life. You just have a life.

And especially as entrepreneurs, our work is so central to our

identity, like it's our company and we take it personally.

You know, if someone quits, like they didn't just leave the

company like they left us, you know, they get, if you get a

loan to, you know, to, to build a business, like you have to

sign your house for it, like the bank will take your house if you

can't pay that loan. That's just what you should

expect when you get a business loan as an entrepreneur.

So there's it's really hard to separate your business life and

your personal life. The stakes matter.

And you know, for, you know, my wife and partner in the

business, she's so smart. We used to joke that she went to

good at everything school. She was just just naturally,

like I had to learn everything. She was just naturally good at

everything. But the first couple of years we

hadn't learned to have boundaries.

And I would do something and you know, we working side by side,

literally at the same table. And it was awesome because we

got to be together the whole time.

But she'd be looking over at what I was doing.

And she's like, why are you doing that?

And I'd say, well, like, I'm doing this, whatever.

And she's like, oh, we shouldn't be doing that.

We should be doing this thing. Or like, why did you spend $200

on that? And we'd have this and fight's

too big a word. But we, we have this

disagreement about like whether it made sense to spend this $50

on this thing or $200 on this thing.

And we were just squabbling a lot.

And it just, it wasn't fun anymore.

Like, it was great that we were able to spend all this time

together and that we had not time abundance, but time

freedom, you know, and how we were able to, you know, how we

were able to organize our time. But it just seemed like we had

less and less time for each other, and we had more and more

squabbling about the things that didn't matter.

And after a couple years, I'm like, this is ridiculous.

We need some boundaries. The first boundary that we

agreed to is she is her area's responsibility.

And I have mine. And we should share, you know,

information about what we're doing.

And if I have an idea that can make her work better, awesome, I

should share it and vice versa. But at the end of the day, if

it's her responsibility, it doesn't matter how much I

disagree. She makes a call, and if she

doesn't like something I'm working on, if it's my

responsibility, doesn't matter how much she doesn't like it,

she makes the call. And we don't even talk about

anything less than $500. And that got rid of 90% of our

conflicts. And then we're able to enjoy

working together again. Yeah.

The, the, the key is just boundaries.

Boundaries and time. You know, if you're having

dinner, don't talk about your kids and just don't talk about

your business. You know, just enjoy time

together. Go on a weekly date night,

whatever it is, the the business could consume your life.

Don't let it. And it's as simple as just

saying here's ours where we just don't talk about business.

Here's things that I just defer to you and you defer to me.

Here's things that we just never talked at all because it's not

worth it. Man, good advice there.

Was there something that significantly delayed the growth

of your business? And if So, what would you do

differently? Yeah.

It's someone that I already talked about.

We, we, we protected our retailers from the world for two

years longer than we should have.

We launched our first direct to consumer retail site in 2009,

should have done in 2007. We, we avoided selling to Amazon

and other, you know, major retailers a couple of years

because we wanted to protect our small independence and what's

happening whether we like it or not.

So we may as well like it. Those are tough decisions.

Yeah. Is there another lesson that you

wish you would have learned earlier?

So many, so many, Eric. Yeah, like I said, I'm a really

good learner, but I had to learn all these things.

And some of these things I learned, I learned a couple

years late. There's two that I'll share that

I wish I would have learned earlier.

There's a wonderful book which nobody needs to read cuz I'll

tell you everything you need to know about it in 20 seconds.

But there's a wonderful book called Multipliers.

It seems like most business books are either that or you

have to read every word. There's not a lot of.

There's a lot of very. Simple ideas.

And then they spend the whole book explaining it in their

illustrator. There's a lot of business books

I read, that's like all I needed was the summary on the back

cover like that you covered. It this is one of those that's

the idea classic business book. Everybody should know it, but

I'll save you a little bit of time.

It's called multipliers. And in my company, I'm a pretty

smart guy and I like to solve problems.

And people would come to me or maybe even they wouldn't come to

me. I would come to them and I'd see

something they were doing. And I'm a smart guy.

I'll tell them what I think is a solution.

And you know, it usually is a pretty good solution.

But every time I did that, I was diminishing the intelligence and

the drive of my people because why should they do the hard work

of solving a problem? I'm just going to tell them what

to do anyway. And before I learned how to be

an inspiring manager who actually knew how to get more

out of people than they were capable of alone, as opposed to

getting half of out of people what they were capable of alone,

which is what I did earlier in my career.

I just learned to take a step back.

You know, when I told you when we were developing our customer

service training manual, I just, I'd learned around that time

just, I always speak last in a group because I'm the boss.

And if I speak first, everybody else just says, yeah, that's a

good idea, let's do that. So I'd ask them, what's the, you

know, what should we do when we short ship and order?

You know, they ordered a dozen umbrellas, we shipped 9.

Like what do we do about that? And instead of me stepping in

and saying, well, here's what I think we should do, I asked all

of them what they think they should do.

And often the idea was better than something I could have come

up with. If I did have a better idea, I

would, I would share it, but I'd wait until the end.

And then everybody had shared. But 90% of the time they either

said what I would say, what I would have said, or they said

something better than what I would have said.

And after everybody shared, I would just say, So what do you

guys think? What's the best way?

What should we do when we short ship in order?

And almost everybody agreed because it was just an obviously

better idea. And then I would, my ideal job

was just to write it down. That was an example of being a

multiplayer instead of diminisher, like getting more

out of people than they were capable of doing by themselves.

That's the first thing that I wish I had learned a lot

earlier. Second is, you know, I told you,

you know, my friends tease me that my love language is SOP in

2009. I have a few things that I knew

that rubbed people their own way or just things that I needed in

a very particular way in order for, you know, me to be happy.

And I wrote a working with Jonathan SOP and I wrote down

all the stuff that people just don't understand about me and my

motivations and what I need in terms of receiving information

and how I communicate. And I'd give it to every

employee on the first day. And I'd say, like, here's how,

here's what you need to know about working with me.

And who wouldn't want an instruction manual for their

boss? Just like a small example, I

have a absurd need to know not just what you think, but how you

arrived at your decision. It's really important to me.

And someone would come up with an idea and say, hey, Jonathan,

like I've like, I've been thinking we should do this.

And I might think it was a great idea, but I needed to know how

they arrived at the answer. That's that's on me.

There's nothing to do with them. You know, that's just one of my

little quirks. And I would then interrogate

them, you know, for 10 minutes about how they got to get to

this answer. And there's a little

uncomfortable for everybody. And then when I was, and then

when I was satisfied, I'm like, OK, great, do that.

And they would just leave thinking like, what happened?

Like I just, I just came with a good idea.

So I trained them like when you come to me to an idea, just tell

me how you arrived at it. And then they would do that and

we'd have a one minute conversation and it'd be

perfectly pleasant and we'd move on.

And I just wish I'd learned how to do that a decade before I

actually learned to tell people how to work with me best.

That's good. Is there an opinion you once

held strongly that you've changed your mind about as a

result of your experiences? A. 100% So when I was a young

man, I prided myself on being hyper analytical and dismissing

what I used to call emotional clutter.

You know, people would come to me and there'd be all this drama

around like this thing happened and they'd be talking about all

these emotions. And I'm just like, just just

tell me what the problem is, let's solve it and let's move

on. And that just struck me as

efficient. And like, why would we waste

time talking about all this emotional clutter when we could

just solve the problem? The problem was that nobody else

in my company thought like that. And they to them, it was an

emotional clutter. To them, it was what actually

mattered. And I learned that everything

that makes life worth living looks stupid through an

analytical lens, right? My, I, I was 37 when I had my

first child, you know, and you know, I delayed for a long time

having kids because I just didn't make any sense to me.

Like, I just looked at the people I know who are parents

and I thought I'd be like, all the time, all the money that

they invest in their kids. And I'm like, they don't seem

any happier. Like, that just seems like a bad

investment to me. And you know, being a father,

it's just, it's the best thing I've ever done.

I get so much joy. I get so much satisfaction of

it. And I tease my son all the time

that he's the worst investment I'll ever make because I'll

never get that time and money back.

But it's just an absurd thing to say.

Like, it doesn't, it ignores all the joy of being a parent.

And same thing with work. When two people are upset about

something, yeah, you could ignore, you know, all the

emotions in it and just solve the problem.

And this is not going to work because that's not what drives

people. We're emotional creatures.

We make emotional decisions, and then we find the logical reason

to justify it. We do not make logical

decisions, and then our emotions fall into place.

And yeah, I wish I understood that a long time ago.

I would have been a lot happier and I would have caused a lot

less, a lot less suffering in my wake.

Well, in that same vein, if you could go back to 1997 and do it

all over again, would you? In a heartbeat, I'd love being

an entrepreneur. I love the freedom and the

abundance that comes with it. These are my people.

All my friends are entrepreneurs.

And it's not just that we start businesses.

It's not just that we see the world a little bit differently.

It's not just that we think differently.

And but we have this agency to act in our lives as an

entrepreneur. If you don't like your team,

let's talk about who hired all these idiots.

Let's do something about it. Good luck.

If you work at a bank and you tell your boss, you know, this

team's not working for me, I think I'd like a different team.

Like you just can't do that unless you have unless you're an

entrepreneur, you have this agency.

If you're an entrepreneur and you want to start taking

Wednesdays off so that you can coach your kids Little League

game, OK, great. Let's talk about how to organize

your workflow so that your company's not so dependent on

you and that you could take that time off with such agency.

And and I love it. You know, there's so much that

I've done differently in my life with how I raised and educated.

I kid how, you know, just travel choices that we've made just the

whole idea to start a business so that we could go back and

forth to China and USC family and all that sort of stuff would

have never been able to do that if I had done any other kind of

work. And it's not without its

challenges. Certainly it's not at all clear

to me that it's easier, but for, Yeah, just for someone who

prizes freedom and independence and just wanting to do things a

little bit differently, there's just no other way to do it.

And those things are really important to me.

Amen. Good stuff.

What has been your biggest win as a leader?

Biggest win as a leader, you know, it's it sounds like a

small thing, but it just it really means a lot to me.

So at our company, we had this big mishmash of people, you

know, our sales reps when they would come to visit there, like

it's like the United Nations here, like we people from every

background, every, you know, we people in their 20s, thirties,

forties, 50s and 60s. We'd people from, you know, half

of our employees, you know, were born in another country and like

all sorts of different countries.

We had salespeople, we had artists, you know, like

designers. We had, you know, warehouse

workers. We had office people, every kind

of education and background. And we all came together for a

single purpose to, you know, to, to, to thrive in this company

because the company was a vehicle, our personal and

professional growth for ourselves, our employees, our

customers. And everyone works with this.

And we used to sell, we used to have bi weekly company meetings,

all, all hands meetings. We'd cater it.

And we would celebrate birthdays, we'd celebrate

anniversaries, you know, work anniversaries.

And we'd end with a company meeting, you know, where you

know, where we're going, what, what to, what to expect.

And we would have people tell us that they felt safer at work

than they felt than they felt at home.

There was young one young man who worked in the office who

that's right, I think it's 23 years old.

He had a much younger sister who was 8 and, and their family, for

whatever reason, this, this never celebrated birthdays.

And he experienced every week, every couple weeks, we would

celebrate birthdays. And he just thought it was such

a fun thing. And he told me the story that

for his little baby sister, he bought her a cake.

And, you know, he was saying happy birthday and just kind of

made her day. And for me, those were my most

proud moments as a leader when I knew that the people that worked

with us just they loved our culture and they took that home

to their families and that they changed their family legacy

because of what they learned and experienced that could or.

That's great. So we're now getting somewhat

removed from 1997. It's been a little while.

You talked about going online and moving away from the small

mom and pop stores to some of the big box stores.

The the market has changed a lot.

Do you think it's still possible today for someone to do

something like you've done? So absolutely possible, probably

more possible, although it's very different.

So we built our business on small mom and pop retailers.

That's impossible these days. There's just not enough of them.

We also built our business by traveling to trade shows.

You know, we go to Atlanta and we'd sign up a sales Rep.

We go to New York and we'd sell, sign up a sales Rep.

We go to Las Vegas, we'd sign up a sales Rep all over the

country. Those people hardly exist

anymore. There's like the average age of

sales reps is in well into their 60s.

Like young people don't become independent product sales reps

anymore. So those avenues are closed.

On the other hand, with, you know, it took us six months of a

lot of work, me a designer and you know, consulting heavily

with a salesperson to build our first direction consumer retail

website. You know, I could probably do

this in two days right now with the tools that are available.

Anyone could sell on Amazon. You literally just set up an

account. Like you don't, you don't need a

buyer to give you the green light.

Nobody's waiting to give you permission anymore.

You can just do these things by yourself.

So and in so many ways it's easier to do.

And then there's a few ways that are that are harder.

Information now is available to everybody.

You don't even need to know which books to read.

You just go to Claude or chat TBT and say, like, how do I get

set up at Amazon? And then it just tells you, you

don't even have to talk to people like I did, like it's

all, it's all available right now.

In so many ways. It's so much easier.

It is a little bit harder to get financing than it was when I was

getting started. Just the, the standards are,

are, are, are, are, are tighter. It's a lot easier to get hard

money, you know, high interest money.

That's a lot easier now than it used to be.

But just, there's just so much less that's required.

You need less equipment, you need fewer people.

And there's just all these services to do it for you now.

So on balance it's easier, But you know, some things are

easier, some things are harder. I know you're no longer running

kid durable. You guys had an exit a while

ago. Do you mind telling us a little

bit about that? The process, the emotions, the

thoughts with deciding to sell, and then just just what that

process looked like and felt like.

Yeah, so it's an interesting story.

So when I told you my friends tease me, I love languages, SO.

PS I systematized everything in the business and after a couple

decades I was working from home a couple hours a day and I was

going to the office once a week for face to face meetings and I

was looking for some other way to express my entrepreneurial

energies. I live about three blocks from

Lake MI, just outside of Chicago and it was a single day.

It was January 31st, 2020, right before anyone heard of COVID and

I took a walk that Friday afternoon from my home to Lake

MI just to clear my head process The week, it's a walk.

I take it hundreds of times, but this day, as soon as the water

came into view, I'd literally felt the ground shift beneath my

feet. I was unsteady and needed to sit

down. And I realized in an instant, I

can't keep devoting my work energy to something that doesn't

light me up. And I took it to our walk and I

cleared my head. And it just became clear to me

in that instant that I was born to be a coach.

Love to learn, great at teaching.

The world needs entrepreneurs who have clarity on who they

are, where they're going and how to get there.

So I came back, talked to my wife and partner in the business

about me exiting to become a full time coach.

She'd been on her own journey this last few years.

She'd wanted to have more operational control of the

business. So it worked out in that sense.

And Eric, it's the best decision I ever made.

If it was merely work I was born for, and it is, it would be a

bright spot. But because what I do is I help

entrepreneurs have lives and businesses, I feel more

effortless, more meaningful, more joyous.

And that first year, there were probably 50 times where I would

be on a call having a conversation with a client about

alignment with purpose and values.

Like we talked about, about achieving goals, about create,

having a vision that magnetically pulls you towards

it. But relationships about removing

obstacles that are in front of you and most importantly,

removing obstacles that are, you know, between your ears.

And I would think to myself on these calls, Jonathan, like

there's that part of your life that's out of alignment, like

maybe you should do something about that.

And they did like 50 times that first year.

And I worked out all of my misalignments, all my fears, all

my compulsions, They're all, they're all gone.

And Eric, the biggest misalignment in my life was with

my marriage. You know, we had 15 magical

years together that I mean, just unbelievably good.

And I could kind of one hand the number of couples that I would

look at and think like, wow, those guys really have

something. But then 2009, a couple things

happened. There was a Great Recession,

which I mentioned. We lost money for the first

time. And it's never fun to lose

money. But the success of the business

was very important to my wife's ego.

It was a real blow to her. And our son was born.

And it's very common that if you have unresolved childhood

trauma, if you have a child who's that age, it could reopen

those wounds. And that's what happened with

her. And she fell into a depression

that she's never really gotten out of.

And things went from magical to pretty good.

But we have our challenges to actively bad.

And I did a lot of healing. I told myself that thing I said

about a few minutes into her call.

Life's a curriculum perfectly designed to work out her

purpose. Who is it that I need to be?

What's the action that I need to take?

What is that I need to learn? And what I needed to learn was

to to exit, exit that company and exit the marriage.

And I did my divorce backwards. I did all of my healing and

learned to love her again before I had our first conversation of

like, you know, divorces. And now I think, but we don't as

far as divorces go, it was it was very drama free.

And it was drama free for a few reasons.

I'd already started my coaching business.

And so much of her identity is, you know, is wound up with

Cadoribil. So, you know, there's two

contentious things in any divorce.

One is if there's children, you know, is child custody.

And the other is assets for child custody.

We have a very unusual arrangement.

We turned our home into a duplex.

There's a wall of separation and a magic door that only our son

could pass through. So both of us get to see him

every day and grow up. And we just totally sidestepped

that issue. There's no shuttling back and

forth or anything like that. And then there's division of

assets. And I'm very comfortable,

confident in my ability to earn. She was less, less confident and

I started negotiations with my walk away, which was about 7,

giving her 70% of her assets, including the business.

You know, she gets to keep the company that we both built

together and that I was no longer really operating and I

got to keep mine, you know, my coaching business and then, you

know, division of properties and stuff.

And it just made all those discussions very easy.

And there were there were probably a dozen times over.

It was 10 months from first conversation to signing papers.

It was probably 10 months where I was sorry, 10 times where she

would come up to me and say like, she wanted more of this or

more of that. I would just say no.

Like if we can't agree to this, which is so lopsided, you know,

in her favor, we can't agree to anything.

Let's just let's just go to court and do a 5050 split, which

would have been so much worse for her.

So I just made a very drama free and it made a very easy

progression. So the company's still around.

She runs it. I run my business.

And yeah, that's what made sense.

And I get to do what I was born for, and she gets to continue to

do what you know, what she feels to me is just such a visceral

part of her. OK.

And so we can take a few moments here and talk about your

coaching business now. What is it that you feel you're

born for? What do you do and how can

people get in touch with you if they want to engage your

services? Yeah, so I coach entrepreneurs

whose minds don't work on default settings, people who

just don't want to follow the traditional playbook.

And I help you find alignment. I help you find what you were

born for. I hope you have a business that

just feels effortless. If you're feeling that your

business is a slog, if you're feeling that it's you've lost

touch with why you started in the 1st place, I hope you

rediscover that purpose, that passion.

The best way to get in touch with me is on my website,

untangleddashcoaching.com. Don't forget the dash.

Or go to LinkedIn and search for Jonathan Domsky.

I'm the only one. Before we started recording

here, when we were kind of touching base, you mentioned

that you and your current wife have a new business venture.

You're leading kind of the the products and online retail space

and diving into the blue collar. Do you want to talk a little bit

about that? What is it you guys got started

and what has you excited about it?

Yeah, So I'm recently remarried and my my wife, she spent her

entire career as a corporate lawyer working in big financial

institutions. And it's exactly as soulless as

you would expect. And she hates her industry.

She's been complaining about it for as long as I've known her.

And when I first started dating, I would say like, hey, like my

friends are getting together in this cool place.

Like, do you want to go? And she would say, Jonathan, I

have to work like, like I have a job.

And after asking this for a few times, she she caught the

entrepreneurial bug. And she agreed that it made a

lot more sense to, instead of devoting all of her work energy

to an industry and a job that she hates, to start doing

something that she thinks might actually be fun and that she

could see and make an impact and to have a little bit of time

freedom. So if she decides to take that

afternoon off or take that week off, she could just do it

because she doesn't have to ask your boss for permission.

And at first she looked at, you know, she didn't want to start a

business. She wanted to acquire one

because, you know, she didn't want to have that long ramp up

because it takes years sometimes, you know, to figure

that stuff out. She just wanted something that

already worked. And she left at some local

businesses, like a bookstore, which would have been a terrible

business, and an ice cream store, which would have been an

awesome business. But there was some weird stuff.

They she actually made an offer for $1000 more than asking, and

they never got back to her there.

There was some weird thing going on.

We don't know. And then a bunch of months

passed by and she said, you know, I'm tired of waiting for

the perfect opportunity to come by.

I'm just going to make it happen.

And she goes online and she looks at the websites of some

business brokers and she says, hey, Jen, they come over here,

why don't you look at this? And it was a grouting franchise

scrub doctor. And I look at it and I say, this

is the most boring business I've ever looked at.

Like why, like why grout like even the words ugly, like like

nobody, nobody is a is a child says, you know, as a 10 year old

girl, you like when I would grow up, I want to own a grouting

business. Like what?

Like why? If you like, no, seriously, come

over here. Look at it and Eric, the the

numbers are fantastic. Like there's huge margins.

It's the current or the the previous owners.

I really respect what they built.

They're extremely skilled tradespeople and they do really

high quality work. They have wonderful Google

reviews and all that sort of stuff, but they go into job,

they didn't own a business. And what I mean by that is the

previous owner was owner operator and he quoted every

single job and the extent of the territory was as far as he was

willing to drive. They've never done any marketing

to previous customers. You know, once they once they

service them, you know, it's done.

Like maybe someone will call them back.

They've just they've never contact them again.

Like we do another bathroom, could we do your kitchen or

anything like that. The only advertising they've

ever done is print advertising, like those value packs that, you

know, homeowners get and you know, they're good.

You know, they work, they barely do any commercial work.

They don't do any government work.

There's just so much opportunity.

And I have a lot of, I tell you, all my friends are

entrepreneurs. I have a friend who is in the

chimney business. I've known him for chimney

sweep, known him for 25 years. He's a $50 million company.

He's the largest chimney sweep company in the country.

And when he started, it was just him and his dad in a truck.

And that's everyone that he competes against, you know, two

guys in a truck. And but he treats it as a

business. You know, it's been a couple

decades since he's gone on a ladder, but you know, he is

professional marketing and he's professional office people.

And he, you know, he trained, actually trains his guys.

He's a, you know, he's a, he's a, an office in a warehouse

where he, you know, brings the guys in and trains them on, on,

on safety and new techniques. He had trouble finding equipment

one year. So he started a product business

and now he's one of the, he's one of the three largest chimney

sweep product suppliers in the country.

And a lot of the trades, the, you know, there's good people

doing really good work, but they treat it as a job.

They don't treat it as a business.

And for someone who's business minded, there's so much

opportunity and, you know, to something as revolutionary as

advertising on Facebook. You know, the, the guys, the,

the workers, they collect checks at the end of the day and would

drive to the owner's house to, to deliver them.

And we were looking at that and like, do you guys like spend

unpaid, by the way? And like, do you guys like

driving an hour with a check or cash to deliver it?

And he's like, no, like, let's get you a debit card so that you

could just go to an ATM after work and deposit.

There's, there's 1000 things like this.

And there's just some opportunity.

She's, she's gonna crush it. She's gonna double, triple the

side of this business just within a year just by doing

things that are line of sight, by treating it like a real

business as opposed to treating it like a job.

So it's exciting. Good stuff.

Well, I'll be excited to hear how that goes.

And maybe we'll have to have your wife on here in a year or

two and she can tell us how she's grown that business and

what it's doing now, so. I would love for that to happen.

There's one more thing I'd share and it's, it's a very common

mistake that people of any, every, any kind of business make

all of the advertising. And like literally this

afternoon, I'm going to be talking with, you know, those

print ad people about changing the ads, refreshing the the ads,

the current ads are all about like we do grout, we do tile, we

do this and nobody buys grout. Like they buy a sparkling

refreshed bathroom that's cost effective because they don't

have to do a complete remodel. You know, nobody buys plumbing,

you know, they buy, you know, pipes that flow and that don't

stink. You know, like there's when you

sell the features, you're a commodity.

When you sell the benefits, the reason why someone actually

wants to do the regrouting, the reason why someone actually

wants to, you know, do the plumbing wants to do the

electrical. This makes the cell so much

easier because then you're talking the customer's language

instead of your language. Yeah, yeah.

So that's what we're doing and it's exciting.

Awesome. Well, this is a question I ask

of every single guest. Are you a person of a particular

faith tradition, and if so, how has that affected your

leadership? Yeah, so the answer is yes.

And I have a an unusual path to to spirituality.

But you know, I was raised Jewish and I love being Jewish

growing up. But when I was 16, I, you know,

followed a path to to atheism and that hyper rationality that

we talked about. And but then, you know, I was

attracted to China and East Asia and I learned about Buddhism and

then I learned about Taoism and these ideas of, you know, the

Asian idea, East Asian ideas are non attachment that, you know,

there's all the stuff that's happening in our lives.

But, and you should be fully engaged.

You should want things. But you know, just because you

lost a game doesn't mean that should ruin your day.

You know, just because you're, you didn't get a sale, you know,

it doesn't mean that it should ruin your day.

And, and I mentioned that my now ex-wife, you know, fell into the

steep depression. And as part of the depression,

she had this debilitating insomnia that lasted for a

couple of years. For two years, she barely got

out of bed. And she was so desperate for

anything that would provide some relief.

And a friend of ours mentioned that we go to this four day

retreat to learn this meditation technique from a Hindu Mystic.

And I went with her just to support her.

And she did it for like she did the meditation technique for

about a week. But I kept doing it, and I still

do it to this day. And every morning, I do a

minimum of an hour of yoga and meditation.

There's a time when I was doing it for as much as three hours.

And it just creates this distance between self and body,

self and mind. And whenever there's all this

drama that's swirling around me, it doesn't ruffle my feathers,

you know, like there's no problems.

There's only situations to either deal with or accept.

And it's something that I've learned to believe.

It's something that I've learned to, you know, to live that way,

that there's no problems, there are only situations.

Do they deal with or accept? And that's an incredible useful

business skill, to not get bogged down with all the drama,

to not get bogged down with the inevitable setbacks that we all

encounter in business and in life.

Just to be able to say life's a curriculum perfectly designed to

work out our purpose. There are no problems, just the

situations. And then to deal with that.

And I never get bogged down on the weight of it.

I don't get bogged down with the all the distractions.

I know what I believe in, know what I'm focused on, and I focus

on it. And I don't think I'd be able to

do that if I didn't follow this path.

Is there anybody that you'd like to see on this show, Somebody

that has a really unique story, a really interesting industry

that you'd like to learn more about?

I sure do. Well, there's three people I

would love for you. Not yet, but in a year I would

love for you to have my wife on and for her to tell her journey

from corporate lawyer to gout Dr. and what she's learned along

the way and how it's impacted her life.

What a great episode that would be.

But there's two people who would be fascinating. 1 is a friend of

mine I mentioned. Who is that chimney sweep

business he's? Oh that would be awesome.

Yeah. And then I have another friend

who has a large contracting business, you know, twenty, $30

million contracting business. And he's not a contractor.

You know, he could barely swing a hammer, but he created this

business around, you know, managing the people who do in a

really spectacular way. Also through what he calls the

his joy, his joy formula, which I, I don't remember off the top

of my head, but it's basically about just removing the things

that frustrate people get on their way, finding what, what

you know, what, what, what they care about and giving it to him.

His family motto, which they say every time after dinner is fun,

fun, fun. He's just a really cool guy and

I think you'd enjoy talking to him and then be happy to

introduce you, man. That'd be great.

I'll we'll touch base offline, see if you can make an

introduction. But I, I really appreciate you

taking the time to meet with us today.

I have a, a lot of wisdom, a unique perspective to business

and corporate values and I think our listeners are going to get a

lot out of it. So thank you for giving us your

time and sharing your knowledge and experience.

That's fun, Eric, I'd love the good that you do in the world.

Well, thank you and thank you guys for joining us here on From

the Ground Up Show. Again, help me out.

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shop.fromthegroundupshow.com. Until next time, keep grinding.