Empowering People, Creating Value and Driving Change with John Swigart: An EOFire Classic from 2022

0:01Boom! Shake the room, Fire Nation. JLD here and welcome to Entrepreneurs on Fire, the only daily show interviewing the world's top entrepreneurs seven days a week. Today, we're pulling a classic episode from the archives, and we'll be breaking down empowering people, creating value, and driving change. To drop these value bombs, I brought John Swigart in the EO Fire Studios. John was named the 2020 Mid-Atlantic Entrepreneur of the Year and has been responsible for overseeing all aspects of Pi since its establishment in 2017. In Today for a Nation, we will talk about how the first and second primary drivers of any person's success are grace and blessings.

0:37The third is what you end up doing with those two things and work towards your vision, have clarity and ensure that you understand what might need to change along the way as you go towards that vision and oh, so much more. And a big thank you for sponsoring today's episode goes to John and our sponsors. Franocity has helped hundreds of people leave unfulfilling jobs, invest in recession, resilient businesses and create legacy income for their families through franchising. Visit franocity.com. That's F-R-A-N-O-C-I-T-Y.com to book a free consultation and start your franchising journey with expert guidance.

1:13John, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Hello, Fire Nation. Thanks so much for having me on. I'm really excited to be here today. I guess something that I believe in that maybe not everybody would think of is I think the first and second primary drivers of any person's success are grace and blessings. And the third would be what you end up doing with those things. We are a product of the blessings that we've been given. And that's the first and most important thing. And this goes right in line, Fire Nation, with our conversation today about empowering people, creating value, and driving change.

2:04And John, you have a pretty unique journey going from CMO to the CEO. Share that journey with us and break down how you actually navigated both of these very different but important roles. My journey in the executive positions actually started as a CFO. And I went from CFO to CMO and then to founder CMO. And I think the most important element on there, and frankly, one of the drivers of why I was able to make these transitions, is I try to keep a growth mindset focused on learning, acquiring knowledge and experience, and then applying that experience in ways that add value in a unique context.

2:48Obviously, those are all, from the outside, very different roles, very analytical, very financial on the CFO side, wanting to be in much closer touch with customers on the chief marketing officer side, and then being responsible for the full culture, people development, team development, customer development as a founder or CEO. So, but they're really all actually integrated. I think how you bring in an analytical mindset into being a CMO and a CEO is very important. And how you stay in touch with customers, even as a CFO and certainly as a CEO is really important as well. So, it all comes down to focusing on growth, focusing on learning, and then constantly finding ways to apply that learning and knowledge and experience into value-added ways.

3:40and where the value add is really driving customer value add. So I talked about this a little bit in the introduction when I was going over what you've done thus far. And I want to move on to Pi. I want to talk about Pi, what it is, what was the idea for Pi, like that spark, and how the heck did you get it off the ground, like that initial traction, that initial momentum? Pi is a small business-focused commercial insurance company. We sell workers' compensation insurance, which is a product that is required by all small businesses, all businesses, not just small ones, if they have employees in the U.S.

4:18The initial spark was actually my co-founder's idea. He was in a he had founded a business that was a data analytics business that served commercial insurance companies and tried to help them analytically derive pricing underwriting results in an algorithmic way. And the frustration that he had was that his clients, traditional insurance companies, wouldn't use the product that they were paying for. They were still using traditional standard methods, relying on individual human being underwriters, assessing an individual business risk, and determining eligibility and price, which is obviously, as you and I talk about this, a very inefficient way to do it.

5:04It does not yield the right answers. It's costly and slow. And when we met, we just decided there was a much better way to solve this. I had come from 13 years in personal auto insurance and bringing that business online and in digital fashion. And that's effectively what we're doing at Pi. We are using data and technology to fundamentally make the experience better for customers and to make the product more affordable. If you don't have a differentiator, you're just going to blend in with everybody else. I mean, this goes for every industry, every sector, every product, every service. So let me put you on the spot here, John.

5:43What is your number one differentiator in the insurance market with Pi? Our number one differentiator is that we say yes to more businesses in terms of we approve their insurance more often, and we do so at an affordable price, and we make the process easy. So it's an overall customer value creation and delivery mechanism that brings those three things together. And our mission is to empower small businesses to thrive by making commercial insurance affordable and as easy as pie. That's actually where the name for the company comes from is the idiom easy as pie. And why that's a major differentiator in the commercial insurance industry is well more than half of small businesses get told no by any one insurance company whenever they're shopping for insurance.

6:38No, we won't insure you. So if you're a new business or you've had a claim or you're in a maybe a higher hazard industry, like some sort of construction trade or transportation industry, your options are really limited. and a lot of companies won't insure you. Because of our deep technology and data-driven approach built on massive amounts of data, we actually have the ability to specifically identify risk characteristics of those types of businesses and offer many of them insurance and oftentimes more affordable insurance than they can get in the market from the companies that will offer it to them.

7:17Now, when you first launched, nobody had heard of pie. Of course, you had just launched. So bring us back to like a moment where you're like, wait a second, I think this is catching on. Was it something you did? Was it a marketing something? I mean, what was that thing that really made you feel like this thing that you were doing had a chance? That's a great question. And we've had a lot of those moments over the few years that we've been doing this. We launched and always anticipated that we were going to be a multi-channel distribution company. We were going to sell directly to small businesses, but also sell through the traditional distribution channels of independent agents.

7:54And we started with direct because that was just a little bit easier to get up and running. And the agency followed a few months later. We started, we were selling, you know, frankly, in the early days, just a couple hundred thousand dollars of premium a month. Just to put that in perspective, we do, you know, multiples of that in a day now. And then a few months later, we added our first independent agency partner, and they were a pretty big partner. And within 45 days, we were getting triple the total volume from that one partner than we were getting from all of our initial marketing. And that was like the, oh my gosh, here's what happens when you put our solution, which again, makes it easier and faster and provides more affordable rates to more people inside a marketplace where there's a lot of customers already looking for this product.

8:47And it just took off like gangbusters. Fire Nation, if you think we're even close to being done talking about a lot of great things that you need to know, we're going to talk about high octane growth, how to make sure that you can inject that into your company without it eating your company alive and so much more when we get back from thanking our sponsors. Starting your own business can feel intimidating. Where do you start? How do you grow? When will you start generating revenue? All valid questions. If you love the idea of creating wealth and freedom, but you're not sure if starting from scratch is the way to go, then I'm excited to tell you about Franocity.

9:22Franocity has helped hundreds of people leave unfulfilling jobs, invest in recession-resilient businesses, and create legacy income for their families through franchising. Their clients come from all walks of life, executive veterans, first-time buyers, and multi-unit investors, and their mission is simple, to remove the guesswork, reduce the risk, and help everyday people become business owners through franchising. Don't know anything about franchising? That's the beauty of it. Franocity provides personalized one-on-one coaching at no cost to you, and they have access to over 600 franchise brands.

9:51And Franocity doesn't just help you pick a franchise, they help you understand the business model, investment risk, scalability, and operational reality. Ready to explore business ownership through franchising? Visit Franocity.com. That's F-R-A-N-O-C-I-T-Y.com to put a free consultation and start your journey with expert guidance. John, insurance is a dinosaur, 600-year-old industry. How do you continue to innovate in such a crusty, stagnant sector? It is, and there are a lot of challenges in the insurance industry. You have capital intensity, you have regulatory hurdles, you have complex problems to solve.

10:29and at the same time we need to make it more simple and easier for customers to deal with and so the the key for us is to make sure that we have a balance of insurance knowledge and expertise with non-insurance knowledge and expertise frankly expertise and backgrounds that come from high growth technology businesses data-driven businesses that can attack these problems with a perspective that is fresh and new, but still has a little bit of an understanding of not walking into all the same potholes and or crevasses that you might walk into if you had a team that lacked any sort of background in insurance experience.

11:16So our industry is sort of called insure tech. And I like that word, actually, because it is a blending of insurance and technology. It's a relatively equal number of letters in the word. And it shows and really explicitly articulates that you have to balance the two things. And I think that's really key to driving innovation. If you just approach it with a standard insurance focus and view, you will have trouble innovating. And if you just come at it from a technology and a high growth company perspective, you will stub your toe or much worse on the insurance problems. So I've heard through the grapevine that pie is known as not just a good, but a great place to work.

12:01How have you been able to build that type of positive corporate culture while still growing at a rapid rate? Like it's usually one or the other. Like you stay small, you can have this like nice team and everybody loves each other and that can kind of go on for a while. Or you grow really fast, there's a lot of churn and like there's a lot of people that aren't happy, but hey, it's just kind of what happens. How do you do both? Yeah, this is something that I've actually been particularly proud of. Not necessarily the early days, because the early days are very founder-driven. They're very small team-driven.

12:29You're all together, and it's very easy to row in the same direction when you have a number of people in the business that you can still count and know all the names of and so forth. We've scaled pretty meaningfully. We're at 338 pioneers today. That's what we call our team members. And so I'm particularly proud of the fact that we've been able to grow, expand, and really enhance our culture and what it means to be a pioneer, even during that time, even during the COVID pandemic and working remotely. And that's not a testament to me in any way. That's a testament to the team that we have. And our culture is every single one of our pioneers driving towards that common mission of trying to serve customers in a better way and trying to make the lives of these small business owners who, frankly, don't want to deal with insurance.

13:22They don't go into business to be insurance customers by any stretch of the imagination. But often it's hard, it's expensive, it's challenging, and we're just trying to make that experience better and save them money at the same time. We have shared values that are really key and important, integrity, ownership, simplicity, and service. And we constantly are reinforcing those values and providing kudos and snaps to our pioneers who are exhibiting those values on a regular basis. We have Snaps Channel inside Slack, which I love to read every day, which is where individual pioneers call out their fellow teammates for a job well done or a job fantastically done.

14:07And it's filled with praise every single day. As I previously mentioned, Pi has experienced high octane growth, and that's really impressive. But unfortunately, a lot of times that results in businesses kind of missing out on certain things, missing certain things, and overall just struggling keeping the kind of quality and positivity within their workforce that you've been able to do. So let's talk about your advice for companies who want to really go on the path of this high-octane growth that you've done with pie, but they need to avoid getting eaten alive by it. What would you say to them?

14:43I think you have to maintain a clarity of vision on your destination. Growth for growth's sake or growth at unit economics that aren't profitable or growth without a clear vision of the destination can be problematic. Certainly, if you're growing without good unit economics, you're burning money. And if you don't find good unit economics before you run out of money, that's a pretty clear formula for business challenges all the way up to business failure. I think that the advice that I would have for a company that is looking to grow is you've got to understand the levers and the drivers of that growth and the balance that operating and pulling those levers is going to have on the challenges that it's going to come with.

15:43One very key challenge for every company that's growing very rapidly is can you get enough people to continue driving the growth? And that's across the board in terms of technology resources, product development folks, and engineering resources. It's can you actually support the scale from a customer service standpoint? In our business, we have to renew policies. You know, don't have to, but you sell a policy, it's got a 12-month term, and it renews. And so when you first start growing, you don't have any renewals because you've got to wait 12 months. And then you don't have that many renewals because you're only renewing what you sold 12 months ago.

16:24And when you're growing really fast, you're way ahead of that. But eventually that's going to catch up with you. And you've got to be out in front of that. And so you have to have vision and balancing not planning too far ahead, not getting too far out in front of your skis, but not being way too far behind. So I don't know if you're a skier or for those of you that are skiers, but, you know, you can imagine that picture of when you're too far in front, you're going to fall forward. And when you're leaning too far back on your skis, you actually start going too fast and you get out of control and you crash.

16:56And so that's the balance that you have to strike. So there's a lot that I want you to be taking away from this, Fire Nation. I mean, there is a way to do what Pi has done for your business, no matter the scale, because these are lessons that can be implemented and learned. And John, you did talk about a lot of really cool stuff today, but I want you to really pull out one thing that you think our listeners who are entrepreneurs, who are small business owners, what do you want them to really take away from everything that we've talked about? What's that one core theme that you really want to go back and touch?

17:28I think it's about working towards your vision and having clarity of vision and making sure that you understand what might need to change as you're going towards that vision. You know, because it is important if you find that you're hitting obstacles or you need to pivot. There's a lot of businesses that are super successful today that didn't start out exactly what they were going to be. That's not the case at Pi, but we've had to make a lot of individual changes and pivots and direction adjustments as we were going and growing. And so you've got to be able to do that. You've got to maintain that agility and that flexibility and adopting a test and learn approach so that you don't get too far out in front of trying something and working and building something before you understand that you're on the right path.

18:20So I think that's the most important thing, whether you've got a relatively small business, you know, with just a few employees and you're looking to grow it and build it. Or if you're in a hyper growth situation like we're in, we're really scaling very rapidly. Fire Nation, so much to take away from this. And John, if Fire Nation wanted to connect more with you or with Pi, what can we do to continue to follow what you're doing there? Anything you want to share here and then we'll say goodbye. Absolutely. Absolutely. So Pi is available in in most states around the country, certainly most of the big ones at Pi Insurance dot com.

18:57You can if you have a business with employees, we may be able to help you with your workers compensation insurance, make it easier for you, save you a little bit of money. We do sell through insurance agents. So just if you want to continue to buy through your insurance agent, you can ask them if they can get Pi. and we're always looking for team members. So if you know people or have referrals or anything that you think would be a great pioneer team member, we're hiring around the country, not just in our two cities of DC and Denver and we love those referrals. Fire Nation, you're the average of the five people you spend the most time with and you've been hanging out with JS and JLD today.

19:37So keep up the heat and head over to eofire.com, type John, J-O-H-N in the search bar. His show notes page will pop up with everything we've talked about here today. And John, I want to say thank you for sharing your journey, your story, your thoughts, your value with us today. For that, we salute you and we'll catch you on the flip side. Thank you so much. Really appreciate it. Hey, Fire Nation. Today's value bomb content was brought to you by John. And Fire Nation, if you've ever thought about creating a podcast of your own, the podcast journal is for you. It is a gorgeous faux leather journal that will guide you step-by-step in the creation and launch of your podcast in 50 days.

20:16Visit thepodcastjournal.com and I'll catch you there or I'll catch you on the flip side. Franocity has helped hundreds of people leave unfulfilling jobs, invest in recession, resilient businesses, and create legacy income for their families through franchising. Visit franocity.com. That's F-R-A-N-O-C-I-T-Y.com to book a free consultation and start your franchising journey with expert guidance.