In 2014 I bought 40 cows and showed Kyle how I could keep all my heifers and quickly grow the herd to 1000 reasonably quickly.
If only that’s how rancher replacement math worked.
When I bought my initial 40 cows (and later purchased more), I did so with a loan. I had a day job and used that to pay it back.
The cows weren’t paying for themselves, but I was making more funneling dollars to pay off interest.
Do I think a business entity should be able to stand on its own?
Yes.
Did I use my paycheck to subsidize my cows?
Also, yes.
It helped me significantly to establish equity and a means to be self-employed. By the time Kyle and I got married three years later, I almost had them all paid off.
For three years, I lived at home with my parents and sent all my money toward those cows, plus a nice mom car 😉.
The cows could stand on their own, but it didn’t feel worth it to let them pay themselves off slowly when I could speed it up to save on interest.
Not to mention, what a catch for Kyle. When we finally got married after 9 years together, he also got 60 pairs that were almost paid off. 😏
To this day, I do my accounting so that each entity must not be subsidized by another. They must be financially sound enough to stand on their own or why do them? But we share money between entities to save on interest and take advantage of opportunity.
On the other hand owning cows to me was always about growth.
How do we decrease our per head overhead cost?
How do we reach our ideal economies of scale.
Raising cows never felt worth doing it for 5 or 25 or even 40 cows. We were doing the work anyway and feeding 50 doesn’t take much more time or equipment than feeding 25.
I remember this story vividly — I was so excited to buy these 40 cows. I went through the math with Kyle. How I would keep all my heifers, they’d breed up at 70% and we wouldn’t cull much else. Our numbers would start expanding slowly then would grow quickly.
Ha. Ha. Ha.
We ended up culling hard. Really hard. Buying more cows. Continuing to be picky and let’s just say my 10 year, 1000 cow plan never reached fruition.
Oh to be so young and naive. What a blessing experience has been on my humility 🫠
