Weekly Business Insights from Top Ten Business Magazines | Week 297 | Entrepreneurship | 2

Extractive summaries of and key takeaways from the articles curated from TOP TEN BUSINESS MAGAZINES to promote informed business decision-making | Week 297 | May 19-25, 2023..

How Dairy Farming Made Me a Better Tech Entrepreneur

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By Justin Vandehey | Entrepreneur Magazine | May 24, 2023

For more than 60 years, the author’s family has owned and operated a mid-sized dairy farm in Junction City, Wisconsin.  These are a few of the lessons he learned and how working on a dairy farm made him a better tech entrepreneur.

1. Make hay while the sun shines.  Farmers often have a very narrow window in which they can plant and harvest crops throughout the summer months, without any real control over what the weather will bring them.   As a tech entrepreneur, he has come to accept that he will never own or control all of the market conditions. Oftentimes, you’ll need to adapt or adjust to the macro-environment to make your business work.  Although the conditions might not always be ideal for your venture, if you have a good product that solves a customer problem, a committed team and the revenues to sustain your business and support, be patient and know that the weather can change at any point. And when it does, make hay.
2. Operate on the horizons.  AI and automation are improving efficiencies across every industry, farming included.  These innovations are exciting, but the reality is that farmers need to be selective with these investments to ensure they can sustain their daily operations and keep the cream flowing.  What he has observed was how his family tested new concepts, all while minimizing capital outlay and disrupting daily operations. This was his first exposure to the practice of Horizon Planning, where projects were resourced and staged according to experience and skill and during times that would minimize disruption to our cash cows.
3. Math and margins matter.  Farmers are basically day traders with less cocaine and hair gel. Not only do farmers need to endure the physical aspects of their job, but in most cases, they’re playing the role of part-time stockbroker.  He has observed his family actively monitor the market rates for milk to understand their margin and calculate COGS based on the inputs from feed prices, as well as improved operational efficiencies from investments in technologies that could help the farm scale. It taught him to look at a balance sheet and the importance of cash burn. He also learned how critical it was to stay informed of market conditions and how they impacted commodities, and more specifically, how to use tax, subsidies and legislation to help your company survive.

2 key takeaways from the article

1. For more than 60 years, the author’s family has owned and operated a mid-sized dairy farm in Junction City, Wisconsin.
2. A few of the lessons he learned and how working on a dairy farm made him a better tech entrepreneur.  One, make hay while the sun shines.  Like in farming as a tech entrepreneur, you’ll never own or control all of the market conditions.  So if you have a good product that solves a customer problem, a committed team and the revenues to sustain your business and support, be patient and know that the weather can change at any point.  Two, operate on the horizons – like farmers tech entrepreneurs need to be selective with their investments to ensure they can sustain their daily operations and keep the cream flowing.  Three, math and margins matter – look at a balance sheet and the importance of cash burn, stay informed of market conditions and more specifically, how to use tax, subsidies and legislation to help your company survive.

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Topics:  Farming, Entrepreneurship, Technology