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Episode-1840- PermaEthos What Went Wrong and What is Going Right

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PE-LogoAbout four years ago I came up with a concept we called Permaethos.  The idea was a community built on the principles of Permaculture.  The plan involved an ownership stake for everyone that participated.  We quickly ran afoul of the FTC as it was considered solicitation for investment.

Please let it sink in that if I just took peoples money and offered no return it would have been fine!  Because without government…., I digress.

Anyway with some juggling and a few different plans we eventually settled on a single farm model.

Some things went really good, some not so good but in the end Permaethos is a success.  We have new plans going forward and part of me still hasn’t given up on Permaethos 1.0.

Join Me Today to Discuss…

  • PermaEthos 1.0 – why it could not happen
  • PermaEthos 1.5 – how it became impossible
  • PermaEthos 2.0
    • Why we went that way
    • The huge tax loss due to it
    • What went right
    • What went wrong
    • The state of Elijah’s Spring Farm Today
  • PermaEthos 2.5 Today’s Model
    • Presentations
    • Courses
    • The Return of AgriTrue
    • A Commitment to Our Founders
  • PermaEthos 3.0
    • The community model revisited
    • May or may not be part of PermaEthos, LLC
    • No matter what PE Founders and Class 01 are Given First Shot!
  • My Thoughts on Making a Farm Profitable
    • No one can do it for you
    • Start small (most of the time)
    • Do not think woofers will do all the real work
    • Do not accept woofers until you have a schedule of work for them
    • It is damn hard, but it is worth it
    • Think alternative revenue steams, tourism, hunting, etc.

Resources for today’s show…

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Comments

Episode-1840- PermaEthos What Went Wrong and What is Going Right — 15 Comments

  1. Thank you for the update. Love hearing about the ups and the downs. I know everyone has those learning curves and the phase of doing it wrong or making mistakes But when you go through them over and over and over (by yourself) sometimes you feel like you are the only one. Or that it’s just you are an idiot. I know that’s not true. Still sometimes man I feel one step away from the fetal position under a blanket with a bottle of tequila muttering just a house boat, just a house boat. hahaha has not happened yet but oh so close. You just back up and hit it again & again & again & again. Really it’s not until someone comes over that understands what we are trying to do that we see all that we have done. We see through their eyes. That helps a bit.

    You guys on top of all that to also have the goal of making a profit. HOLY COW. Then working with a flux of strangers and skill sets. Really you all have done a fantastic job. Not one of those things is easy even by it’s self. But all of them together? Oh yeah I’m sure I would have ended muttering house boat house boat. Thanks again Making a trip out to see it has been on my bucket list.

  2. Jack, thank you so much for your honesty and frankness about the mistakes made and struggles faced in developing permaethos. We bought our little piece of land with big dreams 3 years ago, and have made plenty of mistakes. Most notably, the time I decided we should buy 50 meat chicken chicks and 50 laying chicks to raise, then found myself still building chicken tractors for them when they needed to be out on pasture… And then finding out I was pregnant just before it was time to butcher the meat chickens. Not the best laid plan! But hearing that even those of you who I consider to be experts in homesteading have made mistakes, have taken on more than you could handle well, and are still looking forward to results from your hard work is so encouraging to me. I got my first harvest of plums this year, and am harvesting a good crop of elderberries, and that’s just a small part of what should be coming in the next few years! Thank you so much for all you do to educate and encourage- I would not have done what I have done without your show to keep me inspired.

  3. On the note of Agritrue, will there be anything in the new form of Agritrue for those who were paying members of the website?

    I just ask since I was the first registered farm on Agritrue.

    • We are not exactly sure how we will deal with those who were paid member of the failed version of the site, likely a discount on an as requested basis.

  4. On the song:

    “The land features mentioned prominently in the song lyrics – the Shenandoah River and the Blue Ridge Mountains – have only marginal associations with the state of West Virginia, and would seem to be more appropriate to describe western Virginia. The river passes through only the very eastern tip of the Eastern Panhandle of West Virginia in Jefferson County. Similarly, the vast majority of the Blue Ridge also lies outside the state, only crossing into West Virginia in Jefferson County. According to a radio interview with Nivert, the road is close to her native Washington, D.C., and nearby Montgomery County, Maryland, where Denver often visited. That road — Clopper Road — still exists today, but the landscape has changed drastically from the bucolic scenery that once surrounded it.[11]”
    -Wikipedia

    As a former denizen of the Shenandoah valley, staring at the blue ridge every day (Rockbridge Co. VA), I can’t help but point this out. My father was born and raised in Greenbrier Co. (You better stand when you say it) West Virginia, however.

    • Here is the thing, I think the songs opening lines are misunderstood.

      Almost heaven, West Virginia, Blue Ridge Mountains, Shenandoah River…

      Denver was not describing one place with two things, ie Blue Ridge and Shenandoah of WV, rather three places of a region. Additionally a song has to sound good.

    • All true, Andrew. However, the point of WV where the Shenandoah and the Blue Ridge come together is often the welcome sign for more urban east coasters (such as the writers of this tune, made popular by Denver). Most will never go much further into WV unless they have kids at WVU. I recommend a sunset drive from Frederick, MD down route 340 all the way to Harper’s Ferry. It is very inspiring. I say this as someone who commutes on this route every day. It has not wore off for me. In Harper’s Ferry, there is a rock where Thomas Jefferson proclaimed this areas beauty. That quote can be read here. https://www.nps.gov/hafe/learn/historyculture/thomas-jefferson-at-harpers-ferry.htm

      Either way, great freakin’ song, especially if you’re a road warrior.

      • Man, spot on Hank. It’s so beautiful up that way, be in WVA, VA, hell even that part of MD. It’s a state of mind, in my opinion.
        About 10-15 yrs ago, I used to travel to Eastern WV all the time doing presentations at VFW and American Legion halls and basically anyone who’d have me. I remember one day in the late fall coming back from Moorestown or Franklin, WV and taking the ‘scenic route’ back to VA. I got lost bigger than crap and as dark came in, I had no cell coverage, no gps and my gas tank was running low. Snow started to fall, and I had no way of communicating to my wife.
        Scared the hell out of me thinking I’m going to be stranded in the mountains of WV in the midst of hunting season at night.
        I drove by a landmark I’d driven by before and I was freaking out, in that I was no going in circles. Kind of like that movie the “Blair Witch Project”.

        Anyway, somehow, by the grace of God, I made it, but that was the spark of my prepardeness journey.

      • I’m living in MD right now. I have a great spot that gives me access to the Potomac river and lots of cool tourist places, but I can enjoy them on a Tuesday and not be there with the crowds on a Saturday. The downside is, I live in Maryland. If I could drag Jefferson County across the river, just a few miles, I’d be in a much better place. I have many customers in WV. Cell service is a very finicky thing over there.

      • Hey Hank sorry about you having to live in MD. sad actually because MD is very pretty. I went to high school there and if it wasn’t so liberal, I’d certainly have no qualm about moving back. I lived in NJ for a couple years not too long ago and it’s the same thing as MD, outside of certain areas the people are wonderful and the state is beautiful.
        But just like MD, the taxes and lack of civil rights simply drove me away.

    • Rockbridge County. Man, Andrew, what made you leave there? That place is simply beautiful. Botetourt county too. I can’t imagine a prettier place on earth.

  5. I was thinking about your profit dilemma and man I can see that happening. You can deduct that full 25k for a section 179 and then all the rest… uhm…. even if you spent every single dollar, more than likely you’re paying for assets that depreciate, which means you could spend every dollar you received and still owe taxes.

    I wonder if you could setup some sort of “lease to own” with trees and fencing and all that to avoid this…

    • No not really, farm tax law has a ton of advantages and a lot of gotchas.

      Pay 10K to put in roads, deprecation is over 30 years.

      There are some ways to accelerate depreciation, but not enough and the more you do the closer to audit country you get.

      This is even an issue for PermaEthos 3.0

      Collect member dues say 25K for a month total, many things you want to do now are considered assets, not expenses. Take 15K and put in a great big lake for residents. Guess what 40 years depreciation on that money!

      Put in a big open barn for livestock and gatherings, etc, 30 years. Put in roads, again 30 years.

      Pay someone to do it, it gets gray. If they are an employee, yea deduction, but now you have the burdens of an employee, matching SSI, insurance, etc. Pay them as a contractor, well, well, well, that is just the cost of the “improvement” all you can do is depreciate it.

      • So the way you’d do a road or pond.

        Hire someone as an “employee” never have more than 10. Bite the bullet on the SSI, etc. Lease your equipment, etc.

        Issues, if you have 4 employees and you lay off one, you have had a hit of 25% of your work force you unemployment insurance goes up more than you save with the layoff.

        I mean it almost seems like they don’t want small concerns to succeed or something.

        But take out a line of credit, and service the credit burden with revenue and you are par with a zero income.

  6. Jack, great show. I was completely ignorant about what Permo Ethos was. Man, I can’t wait to sit in on some of the videos. $2.99 for a vid on gasification, battery banks etc??? THat’s money well spent.

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