Paul Ramirez: Welcome to another Western Ag Life Voices Podcast, where we celebrate the people that make up the rich fabric of the Western lifestyle. Please do us a favor and thank the sponsors, because without them, we couldn't bring you these free podcasts. Well, hello, ladies and gentlemen, and welcome to the Western Ag Life podcast. This is Paul Ramirez and I get a great episode for coming for you guys today. We're going to talk a little bit about financing and on the farm and in our agriculture entities. And so I have a great guest on here that has extreme knowledge about helping you be better at what you do on regular basis. And so we're going to get right to that. And I certainly want to also continue to thank our sponsors, those of you that you know, we're standing out there and helping us get the word out about the lifestyle that we live on a daily basis and so forth. so I'm eternally grateful to all those wonderful people, you know, that, that just keep us going and, and sponsoring us. Certainly one of those will be our Bockel coffee is our good, good sponsor. And, ⁓ we are so grateful for their relationship. And certainly if you haven't had our Bockel coffee, man, you're missing out. highly recommend you tie into some. It's absolutely outstanding for sure. And so also continue. Remember, I sell farms and ranches. So if you have an agriculture entity, you're either looking at selling or buying. Certainly would like to talk with you about that. so Stockman's Realty and you can find us on stockmansreality.com and look at some ranches and farms that we have for sale. And certainly we'd like to talk with you if you'd be interested in acquiring a ranch property. Alright, ladies and gentlemen, well, welcome back to the Western Ag Life podcast, where we celebrate people and the stories and the lifestyle that make up agriculture in the West is so special. And from farmers and ranchers to industry leaders and innovators, this podcast is all about sharing the voices that keep our agriculture heritage strong and moving forward. Today, we've got a great conversation lined up. Our guest is Matthew Noggle with the legacy, Farmer Legacy. Matthew has dedicated his life to helping farmers and ranchers build strong operations, improve profitability, and most importantly, create a lasting legacy for the next generation. In a time when agriculture faces more challenges than ever, his perspective on leadership, financial management, and long-term sustainability is something every producer can benefit from hearing. In this episode, we'll talk about Matthew's background, what inspired the creation of Farmer's Legacy, and the strategies he's sharing with producers across the country to help them not only just survive, but truly thrive in today's agriculture landscape. We'll also dive into the importance of family operations, successions, planning, and what it really takes to build something that lasts for generations. If you're a farmer, rancher, or someone who simply cares about the future of agriculture, well, you're going to enjoy this conversation. So sit back, whether you're in your pickup truck or on a tractor or checking on cattle and join us for this episode of the Western Ag Life podcast. Let's welcome Matthew Noggle to the show. Matthew, good morning. How in the world are you? Good morning, Paul. Doing pretty good up here in ⁓ Southern Michigan, where it's about 40 degrees outside right now is where we're calving. But I hate to have to correct you right away, but it's legacy farmer, not farmer's legacy. ⁓ I apologize. ⁓ Legacy farmer. Did I say I said it reverse? You said it reverse, but dyslexia kicked in. Yeah. Legacy farmers. Okay. So tell me a little bit about, so you guys are this morning, you wake up and what's your kind of, what's the regular kind of a day start out like for you? ⁓ for me, ⁓ so on the ranch, ⁓ we're generally check cows at this time of year, first thing. we're calving, we're in the middle of that. ⁓ and then my dad and we have a, employee get out and feed all the cattle. And so we got a small feed lot about just 500 head in there. And then ⁓ I go and get the kids off to school. And then I come down and I start coaching about 9 a.m. in the morning. you got start out a little bit, getting your hands dirty, come in, polish up and then start working with clients. Yeah, I tried to this time of year. I'm definitely out checking cows or making sure we just got done calving out our heifers. And so we're on the the cow side. So those are. a little bit more hands off than the heifers. And so it's not nearly as much just run out, check, see what I got for new calves that I'll have to go and tag once I'm done working. Sure. So let's backtrack just a little bit and find out a little bit more about you. So you grew up on a farm on a ⁓ multifaceted farm, ranch, so forth with diversity, right? Yeah, so I'm actually the sixth generation on our family farm here in Southeast Michigan. ⁓ So it started right after the Civil War. ⁓ And then, fortunately, it was an only son to an only son to an only son to an only son. So we never had much of a challenge in terms of that succession until I got to my family where I have five sisters and two brothers. And so quite large. So that's wh primarily it's always had in our region. Sheep was one of the largest land m of the Mississippi in my my dad converted everythi operation in the seventie So that's what I grew up doing was working with cattle. My dad also worked on some ranches up in Alberta and Western Nebraska. So he kind of brought some of that stuff and culture back with him as well. So we've always used horses to work the cattle and that type of thing on the cow-calf side. And then he expanded into, ⁓ he originally started with a seed stock operation, converted everything over to Semantall and then ⁓ in the nineties, he deci off to maybe we just feed and we've expanded the f perfect. And so, you kno your education? So I broke Grandpa went to michigan And I ended up going out to Colorado State University. So when I graduated high school, we were in the great recession, essentially. And so I was, there was a lot of funding cuts happening and I figured I better go out and see how things are done outside of Michigan. And it was kind of a roundabout way. So I actually went to a junior college in Eastern Oklahoma for livestock judging. Did that got my associate's degree there? And got tied in with the livestock judging coach at Colorado State University there But I always knew I kind of wanted to be when I was younger I wanted to be a feedlot manager and so I was like I want to go where the cattle feedings at so I went went out west and ended up at Colorado State Mostly with their close ties with JBS at that time And to kind of live that way So ended up at Colorado State, went there, got my ⁓ bachelor's and this is when I added business on. was like, well, dad's a good cattleman, but we didn't have any plan on the business side. So I was like, well, I better add that into what I'm learning and get some real value out of college before I either go back or manage a yard, whatever I was going to do. so added ag business on at Colorado State. and ended up getting my bachelor's degree ⁓ in ag business. Perfect. So you brought some theory to reality, I guess. Yeah, I was like, well, we can all be good at what we do. That's what I see a lot on the farm side is we're really good at doing the day to day activities, the things that got to be done, getting the cows fed, keeping them healthy, planting the crop, harvesting the crop. We're not all that good about the financial planning that needs to come along with that. And so that's why I was like, I'm better at that. Understand. And so I guess there never was for you as far as you being, you know, there never was another option for you to ever stretch outside of the agriculture world. ⁓ Not I mean, at times when I first graduated high school and I moved out of my little hometown, And I was like, holy crap, there's lot of things I could be doing. ⁓ but in, I knew like once I was five, like I knew I was going to be a farmer of some sort. Right. And so I knew I was always going to be tied in there in some way, or form. And that's where my true passion and love, you know, resides is in the ag community. So I always knew I was going to end up back to this way. And so then the tie in today to, to where you're at, find yourself today. How did you step in and become part of, and maybe just explain to us then a little bit about what your capacity is there with the legacy farmer. So it goes back. So after I graduated college, I was dating a girl and I was like, well, I better stick around in Colorado for a little while. And a lot of the jobs that I was finding were to go run like a cow calf operation quite further away than I wanted to. So I decided, well, I'll just lean on my business degree and I'll go into banking and for a short term deal, you know, well, so I can stick around. And eventually I ended up in Eastern Colorado ⁓ where right where Kansas, Nebraska and Colorado, all me kind of right in that area and got to spend four and a half years as an ag banker out there. and got to learn a lot, a lot of great mentors out there, the people that I worked with and not just at the bank, but a lot of the customers too were some really good farmers in that area, in that part of the world. And so got to learn a lot, got to start handling. I thought, well, instead of being the feedlot manager, I get to be the banker to the feedlot and get to sit on that side of the desk and see how that whole process works. Eventually, I had that career in banking for about 12 and a half years. And you could say I'm kind of a reformed banker. I know all the things that the banks want. But now I'm like, I really want the farmers to truly understand what it takes to go in there and have a meaningful conversation with their banker and understand their operation. Because what I learned was they would come in, we would I would print off last year's balance sheet. We would then update that together. And then they would say, okay, they would rely on that banker to come up with so much stuff in terms of their cash flow, what things should be priced at ⁓ and all those kinds of things. And relying so heavily on that banker to fulfill their financial obligations to get their loan. then they don't really go back to any of those things that we talked about. They don't go back and compare that cash flow projection to where they're actually at, are they hitting their budget? So after 12 years of living this, I'm like, okay, I'm burned out as being a banker, but I know these guys need help. How can I do that? Well, and so I'm just, know, as you're, as you're explaining the deal, I'm sitting back there. And you know, you said, you said something there that kind of ⁓ prected interest for me you know budget i just wonder you know cuz i've been in agriculture most of my life and had relationships with farmers and ranchers and so forth and uh... i'm not sure and i'm not saying that they don't but what i am saying is that i don't think it's prevalent that a lot of these uh... people have budgets that they actually have a you know systematic uh... system set up for they actually are either tracking profit other than the fact of their are they able to pay their loan payment or they able to pay their payment and then what's left over and that's what we're going to live on from now on. How often do you find that the people you're dealing with actually don't have a budget? Way too often. That's what it would be like. They'll come in and I'll be coaching them and be like, have you ever done a crop budget before? No. How do you know what you're doing when you're marketing? Just taking your best guess. It's like, you know, we talked the other day. playing a little Russian roulette. We don't know if we're shooting ourselves or we've missed it and we're playing for the next round yet when we don't have a budget to see what we're actually comparing against. We no data. Right? So all too often they come in, this is the way we do it. This is the way it's been. Well, the grandpa did it. Yeah, the grandpa did it. it's just, that's too often that we see that. Pretty much everybody that comes in to legacy farmers is coming in where they may have had a partial budget, but they never looked back to see if they actually, did they spend that much on fertilizer? Did they spend that much on that cow? They don't know. Or did they actually, know, and this must be another thing and hopefully we'll talk a little bit about it because I think it's some of the essence of what you do or did they have a financial goal, you know, and have they met that goal or failed to meet that goal? And then what are the consequences of that of both ways? Their goal, only goal I ever see them have is survive, get renewed and survive the next year. we get alone again to go again next year. go again next year. Honestly, it's one of the hardest questions I think I asked them to get a real answer out of is I say, where do you want to be in 10 years? A lot of them don't know. Well, and I think some of it's generational and certainly, know, I was happy in When I first found out about you guys, was one of the things that kind of impressed me is the fact that you guys are actually addressing something that certainly has been ⁓ not been addressed in our industry as a whole, or at least I don't hear it. I'm not involved in production agriculture. I'm just an agriculture fan. However, the people that I interact with on regular basis, when I have conversations with them, those things don't They traditionally don't have the same essence of people that I deal with in other business, whether it's real estate or the feed business or so forth. They handle those as businesses with balance sheets that have to make black and so forth. But I find that time and time again, when I deal with people in agriculture, they don't seem to have that same mindset or what you want to call, guess, they don't have the backing behind them that a normal business would. I think it's wonderful that you guys are addressing these issues and start to treat this as a business so that there is some sustainability and longevity, you know, to these businesses. And I think, you know, one of the reasons and of course, we'll maybe get a little into this later on is that, you know, maybe that's why some of these, you know, some of these farms and ranches aren't able to continue to survive because they really didn't have a plan. You and I both know one of the simplest terms in the world is, you know, planning to fail is failing to plan. I think for so many people and you know, and I bet sometimes you probably scratch your head, especially, you know, up there in that ⁓ Colorado area where you were, we were just up there last week at Sterling, Colorado. And, you know, you see all the production that's going on there and so forth, you know, those people are business people. However, are they really running their entity as a business, you know, that, you know, that you're really strategizing and so forth. And so I bet sometimes you must see some people that have, I mean, a lot, I mean, we're talking millions and millions of capital out and millions and millions of, you know, notes and so forth, but they're just don't have anything really on paper or there. What, what I want to say is just kind of haphazard. I wrong? Right? No, you're right on. So it is you, you know, you can build some balance sheets depending on how you got the land or whatever. And so you can see, you know, some significant. you know, guys with some significant net worth and quite a few loans as well to go along with that and just have no plan of what they want to do for even the next generation or what they want in that 10 years. they just, they're living and they know what has worked and they're just taking whatever the market gives them and not trying to control any of the outcome. And so sometimes they may have hit a, I see a lot of times it's those guys that borrow a lot of money or had some success like they hit a home run, but then they get like three years of striking out and all of a sudden they're re buying the ground again. So that's what we say is like they had to go and restructure those losses and they just turn them back out against that real estate. So they just keep, they never make any progress. They might have a couple of home runs every now and then, and then back it up with striking out two or three years in a row and then re. retirement out that that loss. And so it just never really make any progress, even though they got big balance sheets or in loans to go with it. Well, and I think certainly one thing that, know, and again, hopefully we talk some more about this in a bit is that they really don't have a matrix, right? Something that they really tracking this, you know what I mean? They have instituted something that, you know, and I mean, think about what other business could you go into where you could haphazardly, you know, proceed into this business without a structured business plan, without some financial goals, especially if you're receiving any kind of, you know, money from whether it's a, you know, a board or whether it's a bank, you know, you'd have to have all of this stuff, you know, I mean, meticulous, right? But yet you see some of these farmers and ranchers, they might have that on the dashboard of their pickup truck. Yeah, I mean, I've had it come in where they wrote it on a post-it note what their inventory was, you know, and said, okay, let's fill out that balance sheet. And I'm like, okay, this is going to be one of those types of situations. And it doesn't work. We know like it just won't continue to work. The markets are becoming way too volatile to just sit there and do nothing. Like we have no control over a lot of things. And so You know, like right now you can talk about like the geopolitics that are going on in the Middle Middle East and its effect not only on our fuel prices, but fertilizer prices. So there's a lot of things we can't control. And so what I tell guys is like an ag, there's so many things we can't control. We need to find the things we can and start locking those up and planning for those things. Otherwise, yeah, you're just go with you're just blowing in the wind. And wherever the market wants to go is where you're going to go. So if it's down, you're down. When it's up, you may be up. Right. So like the cattle industry here lately is anybody that had cows was making money the last four years, whether they had a plan or not. And what I hear is the guys that put on LRP or did options or anything are all, all, you know, mad because they lost out on all this upside that may have been there because they went and did had a marketing plan. So they're kind of grumbling at me. It's like, what do I do? And I'm like, just you got to stick with it because this will turn and all those guys that had no plan are going to start to lose their butt. And this deal is it this cattle cycle turns and we start going on a down market. And so, but you're going to be buffering against that because you actually still continued with your plan and we're going to keep hitting singles and staying on base while that other other guy's striking out. Right. So try and keep them in perspective that way. And so just, you know, kind of in this conversation we've had in there. So then at some point in time, I want to get back right now and let's go into this. What was the reasoning? I think we've talked about what the issue was. And now I want to talk about what legacy farmer, what motivated the startup of legacy farmer and how you guys, what your goals are to assist people in this. What precipitated the start of ⁓ this? Yeah. So it actually, was started by Jace Young, back in 2019. And so he was a younger guy. His family, ⁓ had a large feedlot in Western Nebraska and, ⁓ he was off at school in high school and all of a he came home and they had declared bankruptcy. And so that kind of shocked him. And so you can go and check out his YouTube video explaining it all. He'll it does a lot better job than mine. But ⁓ essentially, he said, OK, I got nothing. He went back, went to school, went to college, ⁓ graduated kind of the same thing. Business degree, became a banker, had the same kind of realization I had is like, why are all these farmers coming in here and don't have a clue of what they got, what they're about to lose? And so he's like, we need some sort of service for these guys. And so that's what really sparked it is his family going ⁓ into bankruptcy and losing everything and him realizing how close a lot of farmers are to losing everything. And ⁓ many of them don't even know it. And so he's like, we should start that coaching. And then for me, I live kind of a similar situation. So I went off to school. and was in college and learning that and trying to be away from the farm, trying to learn more what else is out there, right? Which I think is very important for the next generation is spend some time off your farm, off your location, go see how other people are doing it. But that was the last cattle cycle. So 2011 through ⁓ 2014, I was ⁓ at school or just started banking. so, ⁓ talking to my dad, everything is going well. And so, eventually in 2017, him and my mom are saying, we're ready to slow down. What do you want to do with the family farm? I convinced my then fiance in Colorado, let's move back to Michigan and take over. Lo and behold, we come back to Michigan and we take over and The cattle cycle had tanked at this point and we were sitting in a really big hole financially on our own farm. That now I had to figure out how to get us out of. And so for me, like that passion, I don't want that next generation or that person taking over or the senior generation to be like passing on something that's not sustainable for the next generation. And so that's really my passion as a coach comes from is we had a significant hole to dig out of and losses from the feed lot. Cause we had no marketing plan. My dad was a cattle feeder. He had no marketing plan at all. He just, when they were ready, we sold the load, bought cattle, you know, through sale barns, various different ways. And so it was quite, quite eyeopening when I moved back and got in on the farm of holy crap, all the plans and ideas and things that I wanted to grow on the farm and do, we're gonna have to be put on hold because I had such a big hole to dig out of. Now we didn't have to go bankruptcy, thank God, but we definitely, things were that close. We were really close to having to do that. And so it's been, I don't want that for my kids. is that I want to be able to hand them off something that's going to be viable and they can take the farm or ranch in any direction that they they see fit. So that's a lot of my motivation. And then Jase's was was fairly similar to that. But his family actually went into bankruptcy and he had no farm left to go back to anymore either. Well, one of what a wonderful story and certainly something that I think, you know, in this early conversation we've wanted is the fact that this is necessary. And at some point in time, I'm so happy to see that, you know, uh, you know, that farmers and ranchers and people involved in agriculture now are actually starting to, you know, maybe start to treat their entities as, a business. And for that reason, you know, I think sustainability hopefully then comes about, you know, um, just, you know, it blows my mind that, know, unfortunately, and I know you've seen this and all of us that are involved in agriculture have seen this, that somehow or another, we're just kind of a whim to the markets. Yeah. You know, when the markets are good, we're good. And when the markets are bad, we're bad. And I just don't see that, you know, from a business perspective, that's not sustainable, because we know that there's always going to be ebb and flows, you know, I'm listening to a podcast this morning with Warren Buffett, and he's talking about gold prices. And, you know, we don't want to be this, you know, we just don't want to be, you know, a pawn to this gold deal. And whether it's good or bad, we're good or bad. So, you know, I think that's kind of a little bit of kind of what you guys the essence about what you're trying to do, right? For people, right? There are things we can control. So we may not be able to control all the prices, but we can control when we buy, right? Inputs or can weather you buy and we can't control whether but we can control what we do for insurance or like for specifically, you know, like in the cattle world. the rainfall insurance. Is that something that fits your program? Can you do that? Have you looked at all the different avenues of ways to control something? Now, we can't control it all. There's only one person that can control it all, and that's God, right? I should say one thing that can control it all, and that's God. But we can try and put more things in our control. And a lot of times we just think we can't and the farming. so it's for me, like specifically on my operation, I said, I can't just market traditional cattle at my size and make make money. like traditional way. So selling it to a packer. So, ⁓ you know, JBS or Tyson or whoever it is. Right. You name your packer. I was too small. I couldn't really fit. I wasn't going to hit any, you know, ⁓ enough cattle for them to do special grids or anything like that. So I had to develop for our farm was the direct market for our size. That was more of the niche I could find to generate additional income off of our feedlot and cow calf operation. So, I mean, that's the type of thing you got to find. And whether I got a lot of younger producers in that I work with and some of those it's finding the things nobody really wants to do and finding those unique opportunities. So are you, you know, I got guys that are, they started out, they're pumping, you know, dairy lagoons or hog manure or whatever it is, you know, to generate that additional income to get where they want to go. And so they're now able to farm more acres or continue to grow their businesses or add on a hog farm or poultry farm. So it's finding some of those niche things too, I think really helps people, especially the younger generation get going again. And so let's play role play here a little bit ⁓ in the fact that what kind of person would, how would the conversation start with you is let's just say somebody's decided, you know, that they want to implement some kind of a plan together to structure, you know, their operations. So Would they reach out to you and let's let's play how that happens, where you would take the client through. So that first, that first call is going to be pretty much an interview or a deposition if you will. So we're going to take, I'm going to ask you questions on why you do everything that you do. So if I sell my cat, if I got a fall herd, why a fall herd? If I got, ⁓ I run, you know, yearling cattle, why yearling cattle, why does this make sense? So I try and find out what makes sense to them in their area, in their situation first. So I have some cattle feeders that they were like, well, we're buying these day old calves. And we know what the price of those are right now. And they were taking them all the way to fat. So they're having these calves on their, their sheet for 18, 20 months, right? I'm like, Is there opportunity in that 18, 20 months to turn that calf for profit? And can we turn more often and generate more money? So I mean, that's the type of thing that's going to happen. I know I kind of went off topic, but it's those type of questions is what's going to happen in that initial meeting. Why are we doing what you're doing? And then correct me if I'm wrong in this for sure, Matt, but. Also, you know, I've found in again, I've done lots of business with people in agriculture and I've always been on that kind of selling, ⁓ supplying service side. But I find those people in and I'm sure I'm just I'll be I want to hear what your reaction is. I find those most farmers and ranchers to be financially really sensitive and I would want to say secretive, but certainly they don't like to throw out their numbers to everybody. No, not generally. if you're going to be here, where it's got to be an open book, like generally the people, the clients that we get, they're saying, I need to change. So that's the big thing is if you come in here and you're not ready to make a change mentally, you're not going to be successful. And so it's you got to be ready and something has had to happen. And generally, I hope I can bring out that change a little bit in my coaching. with challenging you to actually tell somebody else why you're doing it, other than that's the way we've always done it. And so actually this helps you start to think of the plan of why do I have this? Why am I taking these too fat? Why am I growing this type of crop in this area? Can I do something different to actually get where I want? You know, it kind of goes back to this thing that I keep thinking about out here in the West. I mean, you never ask, and this is an old deal, but you never ask a rancher how many cattle he has or how much land he has. Right. Now, there's a reason. Now, if I ran into you at the coffee shop, I'm not going to be asking those type of things. But when you come here, it's that's the open book. I expect you to be ready to be challenged. But I think we're in agreement, right, that as a whole, most people involved in agriculture don't really like, they're not comfortable giving those numbers out all the time. Right. And especially from a banker, right? I bet when you were on the other side of the desk, I would probably be like pulling teeth. How many head Mr. Jones, do you really have? Well, I have 45 here, but I also have 200 there and, and, I'm partnered on another thousand or something like that lines, right? Yeah, when I first started, because I grew up in that culture, it's like you don't really ask people about how many cash they got, right? And so when I first started banking, that was like, boy, I need to know this. But it was like one of those weird questions you got to ask. And, you know, they'd hem and haw around it. And but I was like, eventually now I'm like, I got to know otherwise I can't help you. And so I'm a little bit more blunt in my approach to it than I used to be. ⁓ But I think that's one thing that I've noticed in kind of like even in our farm community. Yeah, we grew up not wanting to share those numbers, but we also don't. I don't think what I'm seeing is our farm neighbor, our rancher neighbor is more of our competitor than our actual neighbor anymore. And I start to see that because I can remember as a kid is we would go help the neighbor out. So I live right next to a dairy farm. And we had a large ranch right next to us as well. And I remember going over there, you'd help them work cattle, you'd help them, ⁓ you know, buck bales or whatever it was and in or exchange equipment. So we weren't always having to buy new equipment. And so we were actually like a community, a farm community, other than just showing up at the county fair and helping each other out. We were actually like you lived with each other. and ⁓ ran stuff together. So I see some of this and one of the, as I look to the future, is like how can we remedy that our neighbor is not our competitor, but we are actually neighborly again and we are a community. Yeah, for sure. What you know, so I want to kind of start getting into the nuts and bolts here. So you're going to sit down with somebody. What's one of the first things you're going to ask a person, you know, ⁓ that, you know, after you've had your initial what you call, you know, kind of interview with them, but like, what are some of the first things that you're going to need to see that will start you being able to make an assessment of what they have going on? I initially look at their their balance sheet needs to be complete and in. So we'll help them get that balance sheet complete and in. And so we find that starting point. And I want to stop you right there just real quick. and I'm sure just for some of my listeners, because I'm pretty sure some of my listeners that may be interested, I'm just going to tell you straight up, Matthew may not have a balance sheet. Well, they will have one after they meet with me. And so ⁓ but they will get we'll put that balance sheet in. If not, that's where everything's gonna start, right? I have to know our starting point to know where we're gonna go, right? We gotta have the start first. So whether those losses happened in the past, I'm not gonna worry about them at the moment. They will get discussed later on as we talk about plans and if they work prior, but we're gonna establish our starting point and that's our balance sheet. And so then from there, is going to lead to a lot more questions depending on how good the balance sheet looks. So what I'm looking at on that balance sheet is what's our working capital. And so your working capital is your current assets minus your current liabilities. This is essentially how much cash I have to pay all the things I need to in the next 12 months. And then from there, I'm also looking at our debt to asset or leverage. So Leverage is how much do I own versus what the bank owns right or bank has a lien and so We want to know that number because if there is a point where we got to do a Restructure I'm not saying you don't want to ever do one I'm saying sometimes they need to be done to get things right tracked again, but Do we need do we have room on? That real estate to do that restructure to do the plans or to reach a goal later on. And so that first thing is finding that starting point and then we can build on. And then from then you have, I guess you guys have a system together where you'll put that kind of like in some kind of an algorithm or something and then you start to put those numbers together and help them assist them then and going forward as far as being profitable or sustainable. Yeah, so we got a software system that they can upload all that information in so that we can track monthly balance sheets, our monthly cash flow, we can even put in our crop budgets. ⁓ And so we'll do that and we expect them to update those things every month. And then we take a look at, so what's changed in that balance sheet? Is our working capital getting better? Is our net worth getting better? Are we making improvements? If not, why? And then the same thing in that cashflow, because we'll have a projected cashflow. So this is our budget and then an actual column. And so we'll actually every month go back and look back, say, Did I exceed my budget? Did I meet my budget? Just like if you've been on a board or anything, whether it's farm bureau, church board, that right, there's budgets that you're supposed to adhere to and how much money you allocated. We're actually going to start holding your feet to the fire saying you well, you allocated X amount of dollars to fertilizer. And if we're going to exceed it, where are we making up the difference to still make this cash flow work? So or we're running out of money, where do we pivot? How do we pivot out of those situations? So that's, that's kind of, have all of that in our software system. And so each one of our meetings will be running through that, ⁓ with each other. And so the big thing too, is if you don't know how to do a balance sheet or cashflow or crop budget, you got a coach there that's going to help you. that whether it's me, we got, ⁓ about five other coaches that all have, 10 plus years of banking experience know exactly how to put those things together so that you can learn those as well. Yeah, and that's where I wanted to get to. have what asset, you know, that you guys could certainly, you know, so somebody shouldn't feel intimidated if they don't have good financial, you know, payers that they could call you guys and you guys are, you know, going to help them start chart a course that, you know, they can track on paper on a regular basis, right? Right. whether you have, I've got guys that are, I got guys that have like a finance degree that are part of my portfolio and still ⁓ we work together on the planning side, a lot of things. ⁓ but, and then I have the guys that come in with no financial experience at all. I'm explaining what an asset is, what a liability is. Right. So it's the whole spectrum. get them all, but don't feel intimidated. You don't know where you're at. We can help you get there. mean, ⁓ I don't want to digress here, but I think, ⁓ I mean, I imagine there must've been times in, in your counseling with people, especially in the banking industry where, mean, we're talking about people that have multi multi million dollars of things going on. Right. And then they come in there with basically. Maybe they got a checkbook. Yeah. And you're like, I mean, sir. Yeah, mean, $30 million, $30 million worth assets that you have and you don't have any clue about what's really I mean, I mean, he does and I think, know, and certainly one thing I definitely in this episode, do not want to relay. think farmers, ranchers and people involved in agriculture are some of the most astute, smart, savvy people that I've ever met and reliable people. know what I mean? Oh, yeah. I think because of this generational deal, know, when I come from a generational ag family is that it just happens to be, you know, that's just the way we did it. And we don't want to insult grandpa or grandma or whatever. We just want to, you know, we want to keep it going the way. But I think what, and maybe alluded to this in some of, you know, the material that I read of yours is that fact that the world's changed and ⁓ the change, you know, is coming on to agriculture too, is that we just, ⁓ You know, we can't be, you know, whimsical and the fact that these markets can take us out. You know what I mean? I mean, it's just crazy that we're such a, you know, that we're so him to the markets that we don't have any control over the things that, you know, can either take or make or break us. Right. Right. And, you know, I agree. Like my dad, awesome cattle feeder. Like, can you go out there? He can. come up with a ration, knows when the cattle are sick or off or anything. He's gonna nail Knows which cattle to feed, right? There's a lot of farmers like that or ranchers or feedlot guys that are smart, but I liken it to the financial side as a different muscle that hasn't been worked out yet. And so it's like, we need to work on that. because we're really smart in something else and really astute and we want to know like, or you go talk to a cow-calf guy or somebody that's grazing yearlings and you know, they know that grass, that wheat pasture, how to do all that, all those movements, the technicalities of that. But the financial muscle hasn't been really worked out that much. And so we help build that up by repetition of having these meetings and you build up that financial acumen as well. So and so I guess you guys are also, you know, ⁓ you guys assist people in starting because another thing that I've also noticed is that, you know, like you said, you know, farmers really good about a rancher is really good about, you know, doing the things that they do on a daily basis. Unfortunately, either because of, you know, skill levels that are not, you know, they're not trained at or more importantly, don't have time for is that do you guys then help? ⁓ structure and put in place, you know, where they would have a financial person that works with them on regular basis and like a, you know, financial officer and so forth. Will you help them set up situations like that? Yeah. So we'll do what we call like a team chart or accountability chart with them. And we'll have like a finance piece to this and it's everybody that's going to be in their finance circle. And so we can say, once you're ready, So by ready, you better understand your balance sheet and cashflow better than the person you're gonna have help you do it almost so that when they mess something up. like if somebody hires a bookkeeper and that bookkeeper gets something wrong, would you be able to catch it? That's what we want you to be able to do. That you know way that it's supposed to look, because you are the owner of the operation and you're not just relying on your CFO or bookkeeper. And you don't know if they're wrong or right, right? ⁓ But we will help, you know, we'll do some assessments on if they're ready to hire that bookkeeper or a CFO for their operation. What does that look like? Lots of times they rely on us as coaches to kind of be in that CFO role for them. So we're not, I want you to know it. So I'm not not going to just do it all for you. I'm going to help walk you through it and hope they can get you to learn it. And then you can go out and then hire somebody and I'll you find somebody to hire in that situation. This kind of brings me to a story that I used to have a friend that sold equipment. I don't want to say the manufacturer, but anyways, so high dollar equipment. And he would always tell me that, you know, he would show and, you know, train the farmer, you know, on on the, you know, the pluses of that particular equipment and why, you know, merited you know, purchasing and so forth. But he always knew that at some point in time, he is going to have to talk mama into it, the wife into it. because she was the one that was ultimately going to write the check. You know, she would reluct wasn't going to write that check with, you know, reluctancy or so forth. The transaction might not happen. And so he, you know, he told me about one instance where he sold a large piece of equipment with a lot of zeros behind it. And she went in there and just had a like a you know, their checkbook like, like the checkbook from the dashboard of the truck, you know, not even a business checkbook. And she just wrote him out a check for that amount of money. And he's like, you know, he was a little he was like, I just can't believe that, you know, people roll like that today, you know, and I think that probably alludes into a little bit about what you're talking about, right? When someone would make a large purchase like that, that would definitely be something they would need to strategize about, right? And, and understand the validity of it, the purpose of it, you know, and it wasn't going to make, and first of all, can you actually buy that? it, does it merit the fact that you need that or it can buy it, but more importantly, how does it flow into your business as a whole? Yeah. So we, take a holistic approach to this. So we actually have clients, they enter all of their equipment into an equipment list and we'll have them track their hours and acres covered on that. And then we find out what their actual cost per hour ⁓ or per acre is for that piece of machinery. And then we can say, plug in, okay, we know what that current piece is costing me. Now I want to go buy a new piece. Is that new piece going to be a similar cost, cheaper? Where's the efficiency gain in that new piece of equipment? And then, so let's say that piece works. And then we say, okay, Now let's look at this at our balance sheet because equipment is what we call a nuclear bomb to the balance sheet here. So first you have to outlay your cash for the down payment. Then you go get a loan and that loan has 12 months of current principal it's due that is also now a current liability. So not only does it suck out your cash, it also makes your working capital go lower. So you lose working capital and cash. And then the whole time that you got it, it depreciates out at seven to 10 % per year. And so it's losing equity as you're putting more cash into it, right? To maintain this machine. So one of those necessary evils of farming is machinery. But we say, okay, what is this impact on the balance sheet? Do I have the working capital to withstand adding this new loan and the down payment to take that out? How does it affect my cash flow? Do I actually have to borrow on the line of credit to make the down payment? I'm saying it's in cash, but am I just really taking sale proceeds of a crop or cattle and applying it instead of applying it to that line of credit? And so, and then lastly, I say, well, if that all works, now we can get to repayment. Can I actually pay for this loan year over year, right? And so we kind of take it that that through that whole process. And I know everyone's like, well, I got to make that decision really quick. This is why I say we need to have a capital replacement plan in place that's looking out three to five years so that we're not caught off guard. Hey, I got to buy this piece of equipment now. I'm in the middle of hay season. My my hay mines down or whatever my balers down. I got to have a baler. We've already know, we know when stuff is starting to get wore out. We've worked on it, we've wrenched on it. Why is this not part of our capital replacement? Well, and I think another thing, you know, that continues to change is technology changes, you know, and I know this from, you know, just microphones and cameras that I have so forth is that I would say that now to, ⁓ and correct me if I'm wrong in this place, ⁓ is the relevancy, you know, ⁓ the, these equipment that you're buying, how long are they going to be relevant now? Because you and I both know that years and years ago, you know, with the four disc plow last, you know, through generations, you know what I mean? But today. some of the machinery that they have, you know, that, you know, I was looking at a piece of machinery the other day that you can actually put ⁓ for forage, you know, for pasture mixes for different forages, seed forages in that, in that, in that planner. And then it goes through the field and starts to distribute those at whatever amounts that are calculated. So I would imagine that some of that stuff now, especially with the electronics and so forth that, know, this equipment that, you know, What's the life of it now? The relevancy of it. Yeah. And so is it really going to be seven to 10 years like on traditional depreciation model? ⁓ but that all goes back into your plan and where you want to go. if our vision is to do something, you know, down the road where it's going to need that additional technology piece, do we, how do we plan for that? We know that maybe we got to turn over this equipment. every three years instead of like, want this piece of equipment to last me 20 years. Right. So we start budgeting and planning for that additional turnover and equipment if we need to, depending on what they want to do. Now, if we're in like the cow calf world, the new technology, right, is the, the geo-fencing, right? That's the big thing is like, well, now I don't have to go out and build as much fence and I can move the cows. But now How does that change? How long do those? So if you move into that, how long would that collar last? Right. And how often do you got to replace that? And is that part of your, your overall plan? Are you budgeting for that type of thing? know, one thing, like I told you last week, I spent a lot of time on the road and I drove, you know, a lot of that Eastern Colorado area. And of course, you know, I'm on when I'm on the road anyways, going by agricultural property. You know, one thing that I told my wife that, you know, cause I just think about how many dollars are sitting in these people's yards, you know, that you know, are no longer relevant and they have weeds growing over them and this and that. And I just started thinking in my mind, as far as the United States goes, how much dormant equipment is setting agriculture equipment is setting in these farms and roaches now that have, I mean, how many dollars, man? mean, it's gotta be. Just in terms of the scrap metal, you know, that's sitting out there, right? Yeah. Quite a bit. Quite a bit. And why aren't they dealing with that? First of all, you know, I mean, if they know something hasn't they haven't used it in nine or 10 years or whatever. I just don't understand why even if it was just scrap that they wouldn't turn that into something that I mean, they'd be better off to sell it. And if they got 80 bucks from it and put it in some kind of impound account or something, that would be better than just setting their But I mean, if you think about it, and I thought about this on a national basis, how many dollars are sitting in agriculture properties that basically need to go someplace? That's a good question. I don't know if I know you don't know the number but I think it's something that needs to be addressed. You know, why is it you know, why are you keeping that? That's why I like having that capital replacement plan is before that piece of equipment is fully depreciated out and worthless and needs and it's it's so worthless. I'd rather just park it in a fence row than take time to haul it off to an auction or a scrapyard. Right. Exactly. That's just easier. ⁓ We actually are turning that over and then using those dollars to invest into the next machine because we know these machines wear out, we got to replace them anyways. So what is that? That's why I like having that capital replacement plan. We already know when we're going to start cutting, you know, that that equipment out, we want to turn it while it still has some value and replace it with something. Amen. Sorry to take you off on that a little bit. That was just the thought that I had. I'm like, how many dollars? And it's just not here, you know, in Logan County, Colorado, but across the United States, how many dollars are sitting in people's yards that are not relevant anymore that need to go somewhere? But if they actually even like I say, 80 bucks, 100 bucks or whatever, they would take that out and put that into something that's going to turn productive. Crazy. Hey, I want to I want to get back on track here a little bit. Sorry about that. My random thoughts. ⁓ But so let's talk about a little bit about, you know, what I want to talk about succession a little bit, because it's a it's a big topic. I have a podcast coming up here where I have a lady coming in. We're going to talk about, you know, succession. And it seems to be one of the things that I see in agriculture continue to over and over not have good transfers that are strategized but more importantly ⁓ you know that that are methodical that you know that people somehow another you know and then families i want to get your take on this because i know you've seen this play out before where families mom and dad grandpa grandma whatever they really don't want to tell anybody exactly what's going to happen because they are afraid that there's going to be some kind of backlash or something that they're going to have to deal with, right? Prior to their expiration. And it's so common and it's so devastating to our industry because I've seen it actually play out where a brother and a brother and two sisters, maybe the sister and her husband stay on the place and they've worked it. And then mom and dad die without a good exit plan, right? Or go into a home without a good exit plan. And now the two other siblings that live off site. all the sudden now want their fair share of what's due to them. And when they claim that then the brother and the brother-in-law and the sister that stayed on the place, they have to either go to the bank or at that point in time, then they decide maybe through someone like a legacy farmer that this thing will not make scratch and you're just going to have to sell it all and we're all going to have to leave and go get a job at the tire shop or something. Tell me a little bit about what you saw about succession and you guys help with that also. Yeah, so we work with you to help on that succession plan. But a lot of times that we get you in here, you're already a lot of customers are in the middle of it or in a litigation on it. So like you said, it's, you know, the older generation passes away. They may have divided everything up equally or not equally, like fairly, you know, so like I got a customer of mine is going through it right now where They were the ones doing all the farming. We're back home working with dad on the cow-calf operation and the farm operation. And all of a sudden they had agreements with dad about how they were going to pay each other for the labor because the older generation was doing less on the farm labor-wise. And so there was some exchanging of cattle and crop inventory between the two. that was just discussed wasn't on paper, right? And so then the father passes away and the brother starts to accuse the other brother of stealing from the estate when, you these were, you know, agreed upon, you know, terms verbally, but now there's no paper to really back it up. So now they're in ongoing litigation about how much his brother says he stole from the estate. And so it's things like that that we want to try and avoid. And so we're we're going to always be like, do you have it on paper? Do you have it on paper? Because if not, there's always room for somebody else's interpretation. And we want to avoid that as much even when it's dealing with family members, having that lined out so that other family members that are privy to those conversations understand what their parents actually wanted and were Before otherwise some will start to see it as the windfall and say hey, this is my payday This is my lottery ticket and go for it and it causes that rift just like it's Devastating I've seen families completely generational families just completely tore apart because mom and dad for some reason just didn't want to put it on the succession a poor plan succession plan is the leading downfall of most farms across the country outside of financials, right? I'm glad you talked about that. Yeah, there's. I agree with you because I've seen it play out time and time again. And here's the scary part for me, Matt. We know what the average age of farmer ranchers in the United States. And there's going to be transfer. Lots of transfer coming up in the next 20 years. And I mean, it's just it's. It's just devastating and I just don't understand and I'm glad to hear that you guys are addressing this and the fact that that needs to be a plan, especially if a brother, sister, son, whatever stays on the place. That there's a place where there's an opportunity for them after mom, dad either can't be productive or not involved in the operation anymore or expires is that there's transfer that is healthy. and allows everybody to go forward and be financially solvent. Yeah, first. And so let's I say there's like five keys to knowing if you got a great succession plan. And the first one is everybody has a defined role and responsibility and understands that. And so what they are going to do during this, whether ⁓ the father stepping back, you know, the senior generation. the new generation knows exactly what they're supposed to be in charge of that type of stuff. other thing is the senior generation has got to be ready to let go. And so we like be comfortable with being retired. And so I see a lot of times like, hey, I'm trying to pass this off to my son, but they're in there. I talked to the son and the dad's all just micromanaging everything he's doing. So there's no really true clear handoff at this point. When you're ready to retire, you gotta be ready to retire and let the next generation take over. The other one is the next generation's gotta be empowered. So we gotta say the senior generation's like, this is you, you're empowered, you're gonna be able to, can we accept 80 % success? They're not gonna do, the next generation's not gonna do everything the way you would've done it. But that next generation is empowered to make those mistakes, make those next steps. then ⁓ fourthly, you got to have it on paper. It's got to be on paper, legal finding paper. And then five, it's the financial sustainability of the business. We have the business in a good spot. So it's like I go back to when I took over my farm, we weren't in a good spot financially. I have to dig out of the hole. can't do, you know, some of my dreams and aspirations that we're going to take some banks money, if you will, that I, I'm not able to do them right away. And honestly, at my age, it's going to be tough to get a lot of things that I wanted done based on the hole that I had to dig out of. So are we really handing off something that's financially sustainable to the next generation? For sure. Well, listen, I told you we were going to be on 30 minutes and my prompter is telling me now that we're at an hour and four minutes and I'm sure we could go another hour pretty easily with just the questions that I have. But I do want to thank you for coming on and ladies and gentlemen, I just want let you know here as you just come in here and listening, starting this part of the podcast that I've had Matthew Noggle on this morning and Matthew's with Legacy Farmer. And basically what they're trying to do is help farmers and ranchers and people involved in agriculture set up business plans that are profitable, sustainable, and maybe for the first time in our industry something that I have seen that's been merited for a very, very long time is that I think it's, ⁓ and those of you I think would agree, if you don't have goals and you don't have a target, it's really hard to hit those things that you know. Strategize and you know it's been something that I think's been a weak link in agriculture for a very very long time and but more importantly I think that you know it merits the fact that you guys are helping and my hats off to you guys For taking this on because I think it's something that certainly has been warranted for a very very long time, so Thank you for that. I want to tell you I appreciate that I think you're really doing something really really good for our industry as a whole and I think probably you know it allows so many young people now to come into this business, you know, that will allow them to not only be productive, but then be profitable. Wouldn't that be wonderful? would be start to entice young people to come into our industry that could see at some point in time that they could actually be profitable and make a good living. What would be wrong with that? No, that's what we're trying to get them to do. And we'll also we work with a lot of, ⁓ you know, the senior generation and we'll have their sons and daughters and next generation sit on our calls so that they're learning all this stuff at the same time as well and learning how to manage actually manage the business end of it instead of just being the one that's out there getting the day to day labor. Yeah and I guess one thing you know that we're going forward I think probably you know we can't do it anymore like we've have done it for sure because everything's changed but more importantly why would we want to when we know something's better you know I mean And I think that's the one thing we talked about in the early preface to this conversation and the fact that, you know, so many farmers and I mean, there's nobody that is more, you know, ⁓ thrifty and good business people and make things happen with barbed wire and tape and so forth than a farmer or rancher. mean, they're really the one of the most efficient, ⁓ you know, people in on earth. However, unfortunately, you know, for years and years, for some reason, or generations and generations. We've overlooked the fact that you got to take care of the money also. Yeah. In order to give something off, pass on sustainability, but more importantly also for the quality of your life. know, I mean, I read something the other day that there was a deal out there that, you know, farmers and ranchers are about three times more susceptible to suicide than most other industries. And I think some of that, would you agree with me comes from the fact that they don't have a plan. And that's kind of the dark side of our industry is that no one really wants to talk about, but I can tell you, like, I remember just a couple of weeks ago and I've been meeting with a customer since mid summer and I'm like, this is the first time I've seen you smile. And so we're, working through their renewal, but they're finally starting to see some light at the end of the tunnel. Like they were just burning out, burning the candle at both ends, if you will, you know, they, cow-calf operation farmer, lost an employee, just had been going and going and going and just had no idea of whether he could even make this work or not. And we finally were able to put together a plan and a cashflow projection and some things that actually showed a light at the end of the tunnel. And it was just really good to see somebody that you could just see the weight lifted off of their shoulders and just a little brightness in their face again after just seeing, you know, just had the weight of the world on them for the first four months, five months of meeting. Well, I commend you on that. Matt, tell our listeners how they could get a hold of you. ⁓ Where could they find you on the website, your phone number if you want to, and so forth, how you could establish a relationship with them. Yeah. So reach out. You can find us on the web at legacyfarmer.com. And also we're on all the social media. So YouTube, Instagram, Facebook under Jace Young. And so look him up. There's he's got some podcasts and anything there. You can definitely reach out and get in contact. That's the best way. Okay. For some reason you just cut out there a little bit. How do you get a hold of Jace or how do you find Jace's? Oh yeah. So on the social media, it's not Legacy Farmer. It's under Jace Young's name. Yeah, so if you go to YouTube, you would just type in Jace Young or Instagram Jace Young and that's where everything would show up. And certainly then you're on the directory there to get a hold of you so they can. Yeah, so I'm on the website. So my contact information is on the website of LegacyFarmer.com and any one of the other coaches as well is on there. So if you wanted to to get in touch that way, that's that's good. But generally going through the the right marketing and sales would say go through the right marketing channels. they can track all that stuff. that's the easiest way to get a hold of us and start that conversation. Perfect. Legacy Farmer. yeah, you guys, I'll put a tagline on the link into their website so you can go through the ⁓ show notes here on the podcast. Well, Listen, I know you got plenty going on, Matt. So I'm going to let you go here. Ladies and gentlemen, we've had Matt Noggle on here from Legacy Farmer and we've had a great, great conversation. And so want to thank you and I wish you have a good day. Don't forget listeners and we grow and we get listeners and our business grows as a whole. When you guys tell your friends and family about it, please, you know, I really do appreciate it. And I can tell who passes it on. And for those of you that pass on our podcast and and pass on, you know, the affairs that we have going on at Western Ag Life Media. That's how we grow. And I appreciate that. I really, really do. So I want to thank you listeners. We've had probably our best year up to date, best quarter. And it's only because I have good listeners like you. And so we're going to wrap up one other one. Matthew, thank you for being on this morning. I really do appreciate it. Sorry that I took about twice as long as I No, that's fine. Thank you, Paul, for having me. I didn't stay on my budget. It's all right. right. ⁓ Hey, have a good day, ladies and gentlemen. Ladies and gentlemen, don't forget, if it's Western, it's probably us.