68: Identify Your Intrapreneurs with RJ Grimshaw

30
Sep

RJ Grimshaw is the president and CEO of UniFi, an equipment financing company. We talk about the ABLE leadership framework, the concept of intrapreneurship, and break down the world of equipment financing.

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Identify Your Intrapreneurs with RJ Grimshaw

Our guest is RJ Grimshaw, the CEO and President of UniFi Equipment Finance, which grew from $13 million in revenue to $18 million in two years. RJ sits on the board of the Equipment Leasing and Finance Association. And he is a head coach with USA Hockey. RJ, welcome to the show.

Hey, Steve. I’m glad to be here. Real quick correction. I coach not for USA Hockey, but within USA Hockey. So I don’t want to mislead anyone that I’m actually coaching the USA Hockey team. But we have actually a side note, where I live is where USA Hockey is based for the whole country and they bring in the top 20 players, 17 and 18 year olds, every year to play for USA and typically that’s your Olympic team. So I again, I don’t want to confuse anyone or anyone think, geez, RJ is really getting ahead of himself thinking that he’s coaching USA hockey, but I am a certified level four coach for USA hockey. And I’ve coached for close to 20 years. So it’s one of my passions. I just love the sport, but more importantly, I just love, you know, the life application you can, you know, teach players.

Yeah, definitely. And building a hockey team is not completely dissimilar from building an effective business team, right? Who can execute a playbook and score some profitable goals and get things moving, right?

That’s spot on. And there’s a lot of parallels between team sports and business on a daily basis. So, we actually search within Unifi for athletes that have a background and it doesn’t have to be a high level. They just played in high school or club or things of that nature. That means that they understand what it takes and the sacrifices, discipline, and more, most importantly, a compete level of the strive for excellence. So I think that there’s a lot of parallels between any athletics and in the business world.

I definitely agree. And when I was running my own company, I was always looking for, as well, I was always welcoming former athletes, because I knew that they understood how to strive and how to persevere and how to overcome challenges, which in business and entrepreneurship are a given, right?

And it continues to, on a daily basis, those attributes continue to be pressed more and more in the world that we live in and what everything’s been thrown at us over the last couple of years. And it seems like it’s not going away anytime soon now with the other challenges relative to human capital and supply chain and things of that nature. So again, if you built those attributes at a younger age and now you can rely on those and continue to build those muscles in regards to the adjectives that you just said, it’s important.

Yeah, they say that winning is a habit. So let’s start with your entrepreneurial journey. You grew up in a family business, I believe, and you got your first start with a couple of businesses. So can you tell us a little bit about how you got started and how you end up running an equipment leasing company?

Sure. I guess I picked my parents correctly because they’re both entrepreneurs. My dad was a successful business owner and my mom supported him. And one of the first businesses that they had was a mobile home park that they actually built from dirt up and built it to 40 units and maintained it for over 20 years and then ultimately sold it out to private equity firm. And I was part of that and saw what it took in terms of discipline, evening hours, weekends, and things of that nature.

I was young when they started it back in 1969. That was the year I was born in terms of the true hard work of laying electrical and things of that nature. But I was able to witness that. And then my dad owned several businesses. And then ultimately started my brother and I in our first business at the age of 23. I was actually in the US Air Force and at that time home on a family leave and I was in his home office and saw in his home office a listing for a bar restaurant. And I said, dad, what are you thinking about here? And he said, well, you’ve got an eligible candidate right here.

And the next morning we went to breakfast and we met with the realtor and lo and behold, within six months, I was out of the Air Force and the timing was, they were cutting back resources in the military. So the timing was great. Came back and refurbed. The building was built in 1937. So we had to do a complete refurb of the building. And we took it from concept to close to, you know, a million dollars in revenues. And that was during the early nineties when you had to become a destination point for a bar because DWI laws and things of that nature, which are critical, made people sensitive.

So that was my first, you know, entree into entrepreneurship. I did a couple, I call them side hustles, you know, early odd, but that was my first, you know, true running, setting up a corporation, meeting with an attorney, meeting with the bank, meeting with the insurance, and I really learned the value of building strong relationships and understanding supply chain with a distributor. So that was my first entree. Again, I was 23 years old and my dad was my mentor and weekly staff meetings, weekly update meetings, regards to financials, construction and things of that nature.

So I was very blessed and fortunate to be able to one, watch and be part of an atmosphere with my mom and dad. And I quickly learned that it takes two to be successful in terms of understanding the role within the company. And it goes right back to the parallel that we started with in sports. Everyone can’t be a quarterback, everyone can’t be a wide receiver, everyone can’t be a center on a hockey team. You have to understand your strengths and play to that.

So RJ, how different it is to run an equipment finance, you know, financial service company, which is owned by a banking group from running that family owned bar, this one million revenue?

Well, it’s very similar in terms of the foundation of running any successful business. The difference is that when you’re an entrepreneur, everyone has someone to answer to, right? I had my dad back then to answer to. Today I have a boss and a board of directors I answer to. So it’s very similar other than now I’m working and we’re gonna talk about this. I’m working now within the foundation and structure of another company, which is Unified.

But it’s the same attributes in terms of entrepreneurship, resourcefulness, being creative, managing KPIs and things of that nature. So there’s, again, there’s, and if you can run a restaurant, I was talking about this yesterday with a buddy, if you can run a successful restaurant, and we were far from successful from a restaurant perspective, we were break-even, but if you’re able to do that, you pretty much can run any business due to the fact that there’s just so many different elements in a restaurant business that can go wrong or can go well.

So again, I ended up in equipment financing by accident, but I’m glad I’m here. And my true why is that I’m able to help businesses across the country acquire the equipment that they need for their business. And that’s what drives Unifi. That’s what drives myself. That’s what drives our culture within our organization to be able to help these people acquire vans, yellow iron, any equipment, woodworking equipment that they need to grow their business.

And the stories, and I can go on and on in terms of stories, of success stories, and I get chills from that. Because again, that was my upbringing, and I saw what it took, hard work, and I saw what it took to make payroll, and I saw what it took to manage your expenses and your AR and things of that nature. So I can relate when I’m dealing with business owners and understand the hard work that it takes to run a successful business.

I think equipment finance is a great business. I like the idea of an entrepreneur being able to borrow money to grow their business without having a piece of property to pledge to or giving a personal guarantee and sending their life away to a bank. It’s a much more constructive way of financing companies. So I really love this idea.

I believe equipment finance is excellent, allowing entrepreneurs to borrow and grow without risking personal assets or life commitments to a bank. Click To Tweet

And so what we try and do too, to elaborate on that a little bit, we just try and take friction out of the system because time is of the essence. The one thing that every entrepreneur, manager, CEO, it doesn’t matter the title, we all have limited amount of time. And in the world we live in, we’re asked to do more and more. So what we’ve tried to develop and continue to improve on is just taking that friction out of the system when, especially now with the supply chain, people need to move extremely quick or the dealer will sell that piece of equipment from underneath them.

And you can’t blame them because they have to move the equipment. So we’ve taken that friction to be extremely quick. We’re all digital in terms of documentation or credit application, documentation, invoicing. So you can pretty much do everything in transaction right on your iPhone or your phone or tablet versus the old-fashioned way of doing business. And that’s what business owners want and desire. And we’ve been a leader in that aspect. And again, I’m not knocking a bank.

They just move at a different sense of urgency than what we do because we have two elements. We have the customer who wants to get the piece of equipment. And then we have a dealer that’s selling the equipment that wants their cash, wants their money to ensure that they’re going to be paid for that piece of equipment. So we’re pleasing really two parties and trying to give both parties a great experience.

You’re all oiling the wheels of capitalism. I love that. So let’s take a step back and talk about how you built this business. I mean, you went for 30 million to 80 million, 79 exactly, I think. I looked at your LinkedIn profile, it’s really interesting. And what were some of the resources that helped you? And specifically, I’m thinking about the management blueprint idea. Were there any frameworks or authors that inspired you, that gave you some tools that you could use to execute your business growth?

So, I was fortunate enough that the business was actually started in 1978, and I’m the second president CEO, and I joined in 2013. So I had very large shoes to fill in terms of lead from a leadership perspective. But the good news is that I had a team in place, a foundation in place that really just need to be re-energized, and refocused of who we wanted to be and where we wanted to go. Then the Bank of Ann Arbor allowed us to be able to do that because they provided the capital to be able to go out and grow.

And the value to the Bank of Ann Arbor, which is based in Ann Arbor, Michigan, they had a small footprint and they were just from a geography perspective, limited. For Unify, I gave them the opportunity to be national and deploy capital across the country and help businesses again. We’re a commercially focused institution. So when I came in, really my first step, I went through a process and that’s the ABLE process that I mentioned on my website. A is for analyze, so really just come in and understand. And this actually started before I joined the organization. I called employees of the organization, I called former or current partners of the organization. And I tried to do all my research and due diligence to start building what that plan might be, that blueprint.

And that takes anywhere between 90 to 120 days because the last thing you wanna do as a new leader or a new person that walks into an organization is start making changes without understanding what’s already been built. And there was a great foundation already in place that I needed to leverage after I did my analyzing and things of that nature, as well as building relationships internally with the people that were already in place. And they were long tenured employees. I inherited employees that were with the organization from day one, from 1978. And then all of a sudden they were acquired. And then all of a sudden a new president comes in.

So there was a lot of change already taking place. So I had to be consistent and it’s hard work, Steve, as you know, or anyone that knows, there’s trials and tribulations. And then we went through a rebranding a new platform in terms of What was needed for the business and investment in the bank provided us that that investment? But as soon as we as soon as we built and understood what we wanted to do I use the the metaphor that we’re a restaurant when I first joined.

Okay, we found the corner to open our restaurant we’re willing to serve anyone anything if you came in Steve We were excited to have you and we’re gonna give you a great experience and it didn’t matter if you wanted to steak pasta tie sushi We’re gonna do our best to provide you a great experience. But over time in 14 and 15 and 16 We started to realize what we were good at and what we were good at is being a steakhouse And we really focused on becoming that steakhouse house to ensure that we gave the best experience. And what that did for us is it allowed us to leverage and that’s the L part of ABLE, leverage and execute on being the best steakhouse that we could be.

So we were able to buy our inventory cheaper, be able to cook the steaks quicker, be able to give that customer better experience. And that’s that taking the friction out of the system. And that’s where we were able to build grow from 13 million to 35 million to 70 million. And now this year we’ll do close to 100 million. So it’s just continuing, always tweaking. And you can take ABLE and just keep continuing to do it over and over again with any process within your organization or an organization as a whole is analyze, blueprint, leverage, execute. And that’s just a continuous cycle.

Ok, so I want to ask a little bit more about this ABLE framework. But first, I want to reflect to something that’s really important that you said, that you said that the team, that was a great team already, but they just needed to be energized. And maybe that’s the L, you needed to leverage that team. And, you know, this is also what I find a lot of times I walk into a company and sometimes the owners feel that, ah, no one is helping them and they have to make all the decisions and you know the people are not proactive and they have to take all the initiative.

But what I sometimes find is that people are actually, there’s a pent up energy in this company that is waiting to be released, and they do want to be more practical they do want to take more action they really to work harder. If only someone gave them a purpose and the vision and the clear structure on how they can be successful. And I think this is this is you know. This is what a leader is supposed to be doing, releasing the pent up energy, giving that structure. Giving that direction to people so that they can be successful as well as everyone else, the company that wants to push things forward.

I completely agree with that. And the other the other piece of the of the analyzing is analyzing the strengths of your current team that either you’re walking into a business or I walked into this business or any other businesses, understanding the strengths and then also having that dialogue with the team in place of one, current objectives, two, how do you like those current objectives? And then three, where do you wanna go? What do you wanna do? What do you feel is your strength? And I had to have those conversations and then really rearrange some things.

You know, you go back to the old, you know, good to great on the bus, make sure people are in the right seat. I had to rearrange some people and move people to where they wanted to be and what they wanted to do and then leverage that and then go out and recruit and bring people in to fill the other places in the organization. And again, we’re far from perfect. I don’t want to, I don’t want to mislead anyone. You know, we work at it every single day. You know, we try and be transparent as we can with the team and allow ownership. And I will say during COVID, it really produced incredible results in terms of the ownership within the knew where we were going, we knew how to do things.

And during that time, we earned a lot of business, because a lot of other institutions and they continue to do pull back, or they use what’s going on as an excuse not to provide the same level of customer service. And again, that’s a culture built within and the culture is driven by the team members. As a leader, I can I can say and lay out a vision however it comes down to that that E piece the execution of the team and driving the culture and buying in and I always say this to my team and I say it to other people as well if you don’t feel that you want to be part of this team. That’s okay come and let’s have that conversation figure out where you want to go and we’ll help you get there Well, we’ll help you get to where you want to where you want to be in your career. We’ve helped people and I’m a firm believer in that. You have to be happy and be satisfied of what you do on a daily basis.

Analyzing your team's strengths and aligning them with objectives is crucial. Conversations on current goals, preferences, and aspirations help reorganize the team effectively. Click To Tweet

So RJ, so talking about Able Blueprint, and you have a website, RJ Grimshaw, where people can look this up. I’m particularly interested, so we have analyze blueprints and then leverage, so an execute. So what about the leverage? So what is your conception of leveraging? What is the idea and what is the process?

It’s a loaded question. It’s a big word, but primarily if you break it down to the ClipNotes version, it’s really the blueprint after analyzing, and it doesn’t matter what businesses it is, but the blueprint is where you’re asking, or excuse me, the analyzing is you’re asking those questions to understand go-to-market, you know, margins. Again, that’s a loaded question. And then you build out the blueprint with the buy-in from the team. It’s just not RJ or the platform. It’s the buy-in of the team, and they’re really building that blueprint.

And the leverage piece is after you’ve built it, and I’ll just use standard operating procedures, SOPs. You build out the SOPs, and then you’re leveraging against the SOPs on what you should be doing on a daily basis. And then and I’m using a lot of acronyms here, but I’m a firm believer in them. And then it’s what, what are you committing to the marketplace, you know, your service levels, what are you promoting?

And how are you going to live by on a daily basis? And if you leverage back to leveraging that, so it’s just always leveraging different things, and then deciding if there’s an SOP that needs to be fixed or enhanced, you shouldn’t be leveraging that. You take that out, right? And not leverage that. So, and also look at technology needs. Technology is such a critical point and part of every business. Look at what happened yesterday and how many people scrambled yesterday when Facebook went down and Instagram and WhatsApp. No one had a plan B.

There was businesses, and I’ve been a firm believer of this, YouTube’s been amazing, right? So many people are back to leverage, leveraging YouTube to build their brand, and a lot of people, folks, are now earning a very significant earning, a lifestyle off of YouTube. But what if YouTube went away tomorrow? They have no control over that. Same thing with Facebook. So you have to be an omni-channel or use omni-channels to be able to build your business and revenue and things of that nature. And if you’re just relying on one platform, I would highly recommend find an alternative and start bringing some of your folks to that alternative as well, because who knows if it ever went down again. It was just interesting to watch yesterday when that took place.

I agree with you. It’s you cannot rely on a single. Then Kennedy said that one is the worst number in business. One of anything dependence on one single salesperson or a single sales channel or a platform or a single supplier can all seek you if they go down and you don’t have control over them or they become unreasonable. they set unreasonable terms. Talking about restaurants, I had a friend who ran a very successful restaurant in Budapest, in downtown Budapest, in Hungary, and they had a good run for 10 years, and they had a 10-year lease. And when the lease was up, the owner of the property, I think, more than doubled their lease, like two and a half times, and essentially took away their profits. And they extended for a couple of years, but then they closed the restaurant down because it’s no longer a good business because they were dependent on that single location and that landlord on the property.

Which is very unfortunate, but it probably happens more than, especially in good times when landlords are able to do that. But we always are analyzing our revenue streams at Unify to ensure, because even over the last eight years, we’ve seen an experience, so an evolution of some relationships come and go. And it’s always our job to ensure that we have a pipeline full of alternative opportunities. And however, we want to be proactive with that. To your example, the last thing you want to do is go out and start trying to renegotiate rents or find a new property when you’re at when you’re down to the wire, because that’s not an abundant mindset. That’s a scarcity mindset. And that’s a whole other conversation of how when you’re working on your business.

So, so RJ on our previous conversation, we talked about inspirations and, and people that influenced you earlier in your career and you also, you know, showed this book that you really like, and we both agree that Peter Drucker is a great catalyst of the whole management and business building movement from the 50s onwards. And you mention book, The Effective Executive. And I wanted to ask you, you know, what you took away from this book, what were a couple of ideas that you felt like were instrumental in you building UniFi?

Well, there’s so many. And, you know, this book is aged, as you can see. I’ve had it a long time. And it’s one of those books that I go back to all the time. And you know, I’ve been reading it for a long time and it’s one of those books that I go back to all the time. And I read this for the first time probably 20 years ago when I was in corporate America, just starting my leadership aspirations and so many things.

But one of the quotes that I love from multiple books, I’m not sure if it’s in this book or not, is management is doing things right, leadership is doing the right things, right? And that’s discipline on a daily basis of the activities as a leader that you’re doing. And another great book that I absolutely love is the E-Myth. And it’s a simple principle. Yeah, Peter, as you know, you wanna work on the business and not in the business. And that’s hard to do when you’re that business owner at times, you have to be extremely disciplined and build that model.

Management is doing things right; leadership is doing the right things. Click To Tweet

As well as I talked to our management team and our leadership team about that as well. You know, we call them big rocks. And what big rocks are you working on a quarterly basis? Because it’s very easy to get tied up just in the minutiae on a daily basis. And then as well as income goes up or investment goes up on a team member, we discuss return of that investment. We’re fine with investing, but however, with that, we want to return on making the better the business better. But again, you know, Peter Drucker is one of my all time favorites, you know, entrepreneurship.

And one of the other quotes he mentions is, you know, the entrepreneur always searches for change, but then exploits the opportunity. And that’s very similar to the topic of entrepreneurship. You know, it’s that same mindset that you utilize that an entrepreneur is always looking for improvements, is always, their mind is always racing and thinking about how they can do things and ask, you know, why, why, why? And that was one thing that I did when I came into Irvin and Unifi.

An entrepreneur is always looking for improvements, always racing and thinking about how they can do things. Click To Tweet

Steve, I would always pose the question, can you tell me why we do it like this? And I’m not saying it’s wrong. I just want to learn and understand it. And by asking it that way, it lowers the wall. Okay, he’s trying or she’s trying to critique me or they’re trying to… No, I just want to understand it. And then would ask questions, probing questions. And it pushes people out of their comfort zone at times when you start asking those probing questions, which is good, which is good.

They may not be asking themselves these questions and just do things because it’s always been done that way, but maybe it’s not the best way of doing things.

Well, and I also use again the example of at your house, right, you become insensitive to things in your house and when someone walks in for the first time, they can say, oh, geez, that wall needs to be painted or boy, that carpet needs to be replaced. You become unsensitive to those things. And the other saying, I say, you can’t see the label from inside the jar. And when you’re inside the jar, you can’t see that label. So you have to pull yourself up and above or outside and then look at things from a different perspective. And it is hard. I am not, it is very, very, very hard to do that. But you’ll find successful entrepreneurs and successful people in their lives. That’s one of the traits that they have.

Yes. And Peter Drucker actually talks about the process of creative destruction and, you know, how important it is to actually this is what we call disruption these days, when you create a product that will destroy an existing mainstream product by being maybe cheaper or more effective or more cost effective. And you create the new by destroying the old. So that’s also a big concept. So I want to go back to something that you mentioned. You talk about entrepreneurship and there are different definitions of entrepreneurship. I heard one where someone works at a big company and they run their own unit in this company and they feel like they can. This was my concept of entrepreneurship. When I was working in a big bank, I felt like I was an entrepreneur because I had, I was fairly autonomous, I was running my own department until the plug was pulled on me and I was pushed out and suddenly I realized I was not an entrepreneur, I was just an employee without a job. So, but your definition of entrepreneur is much better. So what is your, your entrepreneurship? What do you mean by it?

Well, and to your point, there’s several different definitions and it means different things for different people. But I believe a true entrepreneur, when you identify one is a person that is willing to go back and ask those questions, why do we do it like this? And they have that mindset. And there’s five things to identify an entrepreneur within your company, and that’s ownership mentality. They’re gonna own their piece of the business.

They also are people that are life learners and everyone in your audience is watching this because they’re a life learner, just like you and I and they wanna get better. They have a passion for life, they have a passion for business. They’re a calculated risk taker. That’s why they’re an entrepreneur, not an entrepreneur. They are a risk taker, but they’d rather take that risk within the environment of another company. And then they’re always looking for process improvement. And that’s a Peter Drucker, he had a quote, efficiency is doing better, but what is already being done. So it falls in the line as a entrepreneur.

Now, there’s key things that have to mesh with an entrepreneur in the company. They have to believe in the company. They have to believe in the culture. They have to believe in the vision or it doesn’t work because you’re gonna get discretionary effort from that entrepreneur because they’re more engaged and they’re higher functioning than what I call vital employee. Okay, they are very instrumental in the growth. And I actually think it’s more important for smaller businesses to identify entrepreneurs within their organization versus big companies. Because within big companies, they’re typically doing a innovation and different things, which are, again, are very, very important.

But my message is more around the smaller companies that need to stay out in front of the curve, specifically what we just experienced, okay? But also you can look at all the failures of companies, look at Blockbuster, look at Borders, look at Kodak, how many companies that just did not innovate or do anything and now they’re realizing that. And there’s so many products that were built from that. The Post-it Notes was developed through an entrepreneurship program. Johnson & Johnson has an entrepreneurship program. So I’m trying to educate the small, the medium-sized businesses that they can do the same thing. And it’s just not around products. It’s not around the next post-it note. It’s not about the next product, but it’s around-

About the people.

Exactly.

Yeah, but I love that ownership mentality, life learner, passion for life and business, calculated risk takers, process improvers. So this is, I mean, yeah, this is a dream employee right there.

And they’re out there. We have them at Unifi, and you can’t have an organization, Steve, with all entrepreneurs. That doesn’t work either, right? It’d be like everyone’s an entrepreneur trying to run. It doesn’t work. It’s back to that teamwork and understand that. But if you can identify two or three or sometimes just one that magical one person Yeah, it’s it’s fun to watch and I haven’t I actually have it I had a younger gentleman that worked for us no longer with us. And this is one of the fears of identifying an entrepreneur Because they are so self-driven and life learner sometimes They feel they outgrow the organization and seek something else, which I’m fine with. I’m, again, I’m good with that.

I think this is one of the reasons why organizations have essentially no choice but grow, because if they want to keep these kind of people, they have to be able to give them an opportunity and they can only do it if they keep growing. If they don’t, then they’re going to lose these people and they’re going to end up with the mediocre people and they just kind of become a mediocre organization. So it’s sometimes people would like to freeze things, you know, you’re successful, you’re making a couple million dollars, high margin, small companies are often high profit margin because they found their niche and they just want to stay there, you know, and turn it into a lifestyle business. But then it doesn’t work because they lose the momentum of growth, they lose the people that actually created that organization, or it’s just the founder and they have to do everything themselves.

So that doesn’t work. That goes against the e-myth because they’re doing everything themselves and at the end of the day we know what’s going to happen there unfortunately. They’re going to get burnt out and the value that they were trying to provide to the world now is not being provided. So it’s actually a sad situation.

It is. So so lots of information. I think we should stop here because it’s going to be difficult for people to absorb and take away less and sometimes more. So we talked about the ABLE framework that you have created. And and I think it’s RJ Grimshaw that come right. Where else can people learn about your work? How can they connect with you?

I would say that if you just Google RJ Grimshaw, you’ll find videos. I talk about a lot of different topics. One of my other passions is social media and brand awareness, a lot about entrepreneurship. But rjgrimshaw.com is my main website for equipment financing. Our website is teamunify.com, T-E-A-M-U-N-I-F-I.com. I’m on Twitter, RJGCoach, LinkedIn, I’m pretty much on all social media. Just again, just trying to give back and give to the world. I’ve been blessed with great experiences, learned from a lot of people and just trying to share those experiences.

Well, thanks for coming on the show and sharing your wisdom RJ. And to our listeners, if you enjoyed the show, please rate and review us on Apple Podcasts and subscribe on YouTube and stay tuned because next week we’ll have another exciting entrepreneur with interesting management blueprint ideas and concepts that they will bring to you. Thank you for joining and RJ, thanks for joining us as well.

Thanks Steve, appreciate it.

 

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