Tuesday, December 12, 2017

Dark times in the USA

Here is an update of where we are at.
The silver lining is that Disruptive Wind is still going strong and has made a real difference in my life, as well as having significant, behind the scenes, impact worldwide. I am very optimistic for the future of this company as we continue to expand our intellectual properties, databases, scientific and industry knowledge, and explore new areas.
The company continues to be cash flow negative, but this is intentional. We have a number of business plans that, if pursued, would result in revenue generation potentially leading to net profitability. However, the problem is the word "potentially". And that has sunk many a business.
The largest issues to growing a business "organically" are right at the start. One has to make a leap through a ring of fire
which is almost impossible to go back through, should things not pan out.

I will briefly run through why "making a little money" is a nightmare that I wish to avoid.
-Recordkeeping: The burden is high as it is, but with an active business, becomes almost an FTE in itself. FTE is Full Time Equivalent, also known as "one employee". More about FTE's later.
-Time: Running a start-up takes massive amounts of time, time which would no longer be available for inventing, researching, experimenting, and all the many other things keeping me extremely busy already. I could hire another FTE to do this as well, but then I am managing the 2 FTE's and would no doubt get sucked in as the business grows; there is never enough manpower.
-Legal: The modern regulatory requirements for new businesses are severe. I can invent at home and experiment out in the world but I am absolutely forbidden from operating a home business that manufactures or has customers coming in and out. Insurance would be required, renting property to house the business, government inspections, permits, licences, business accounts, and even more FTE's to do the work.
-Equity and control: The money, division of labor, and legal liability would mean transitioning to a corporation business structure. To obtain the needed money would involve loans and/or giving up equity. Both would entail loss of the absolute control I enjoy now.
-Risk: Most start-ups fail. Shark Tank type investors want businesses that have leapt through the ring of fire and are now indisputably on their way to huge profits. In the past, we have only focused on areas with niche or narrow markets, with moderate profit potential, not huge. We now see why this appears to have been a mistake, but I will say that the ride was worth it to get us to where we are now. Bottom line on this item: I do not see a clear path yet for prior inventions except for quite possibly the MoaB (TM) repositioner (which needs further inventing to solve it's largest drawback).
-Experience: This is my third business. My first was Peter and Eddies Studio, a partnership with the famous Fast Eddie that basically involved a crazy plan to sponsor the Oregon band MZT and failed miserably with the very first concert at the Seaside Convention Center.
My second business was P & R Agronomics, a S corporation that pioneered a new way to grow Shiitake mushrooms with a fantastic business model that provided significant revenue from fresh mushrooms, dried mushrooms, and DIY kits. This successful business was terminated due to the inability to scale and grow organically. I was unwilling to take the risks involved in a leap bigger vs. a job offer that assured a comfortable income and much less stress. It was a wise decision as we would have ultimately been doomed as a key supplier/local industry later failed.
Back to the current business: I have learned a lot and continue to learn. Biding my time and getting it right will pay off. The proper idea can be sold or licensed to others with minimal risk.
-Taxes, Money, and Health Insurance: This is where the title of this blog post applies. Sadly, the USA is in crisis right now as our for-profit health care system is collapsing with the encouragement of our corrupt government. Our economy is at risk as well as the wealth imbalance continues to worsen, again with the help of our corrupt government. Did I mention that our government is corrupt?
The fact that my business has to directly bear the cost of my own health coverage, as well as that of any FTE's I hire, is the single largest impediment to the success of Disruptive Wind. The tax structure comes in at a close second, with the corrupt government only seeking to make things worse (except for Bernie Sanders, of course, who continues to fight the good fight). My current effective marginal tax rate is OVER 100%!  To bring in a single dollar in revenue (or decrease loss) actually would cost me over a dollar. Hundreds means hundreds+ more. Same with thousands. It would take many tens of thousands of dollars of revenue before there would even be a chance of coming out ahead.
Bigger losses do not help, however, and there may be a way to manage a balanced income/loss situation that maintains the precious stability I have worked so hard to achieve. 

I'll shed some light about what (and why)  Disruptive Wind is now excitedly working on, as well as some thoughts on some amazing results of secret experiments done on a remote tropical island recently by me, in my next blog post tentatively titled " Forbidden Science and the Moral Imperative'. 
 Be well... 

1 comment:

  1. I apologize, I was wrong about my effective tax rate. I have been studying current tax law ever since and have found many tax breaks if I do show a net profit. I could come out ahead. I'm now more motivated than ever!