Penkala became renowned for further development of the mechanical pencil (1906) – then called an "automatic pencil" – and the first solid-ink fountain pen (1907).

Collaborating with an entrepreneur by the name of Edmund Moster, he started the Penkala-Moster Company and built a pen-and-pencil factory that was one of the biggest in the world at the time. This company, now called TOZ-Penkala, still exists today. TOZ stands for "Tvornica olovaka Zagreb," which means "Zagreb pencil factory."

He also constructed the first Croatian two-seat aeroplane in 1909, which Dragutin Novak, the first Croatian pilot, used for his first flight. He constructed and invented many other products and devices, and held a total of 80 patents.

Penkala died in Zagreb at the age of 51, after catching pneumonia on a business trip.