Cam and Jess Lea have earned the respect of their neighbours to the point that four farming couples have backed them financially into their first sharemilking position after their second year in the industry. Sheryl Brown reports.
Four Opotiki neighbouring couples have backed Cam and Jess Lea into their first sharemilking business, holding 16% equity share apiece. Andrew and Kelly Clarke, Dave and Nat Wilson, Rob and Moira Anstis, and Colin and Maria Eggleton are all born and bred in Opotiki and knew a good investment when they saw one.
Cam, 28, and Jess, 27, sold their house, their nice vehicle and their boat to put $75,000 into the equity partnership and borrowed the rest to buy the Jersey herd that was already on the farm.
“Getting these investors has put us into a different ball park altogether. Money and opportunity don’t always come at the same time,” Cam says.
The opportunity came after Cam had worked just two years in the dairy industry as 2IC for Andrew and Kelly Clark.
‘I hold Colin and my agribusiness tutor Gillian Searle in high regard with the teaching and mentoring of the finer details of operating a business.’
Andrew told Cam and Jess about the potential of a sharemilking position coming up on the McDonald farm next door to Colin Eggleton. The couple interviewed and were offered the position on condition of finance, but after doing the numbers they knew they were short.
“I talked to Andrew and he said he wanted to support us,” Cam says.
“Rob had also said to me that if we needed backing then to give him a bell. So we sat down with everyone and they had faith in us to do it.
“We are really grateful to them to allow us to get to 50/50 in two years without family backing. It’s fast tracked our equity growth.”
Cam had a rural upbringing, and after school he got a job for Te Awamutu contractor John Austin for six years.
He met Jess when he was working in Hicks Bay and the couple bought their first house in Te Awamutu and started a family.
Cam’s long hours meant he was hardly getting to see their two girls, Ayla and Kensi.
“Cam was working really long hours in the maize season and the girls didn’t get to see him,” Jess says.
Jess’ family is from Opotiki so the couple decided to move there and Cam looked for a job on a dairy farm.
He was keen to work for a farm owner, rather than a sharemilker or contract milker, because he wanted to learn as much and as quickly as he could, and as fate had it he got the job on Andrew and Kelly’s farm.
“Andrew has been my mentor, he knew our goal was to go sharemilking and it’s really been him that’s made it happen,” Cam says.
During his second season Cam bought a $14,000 harvester along with Andrew, Rob, Dave, and Colin.
The farm owners all owned a rake and trailers between them and now all help each other to do grass silage each year, including covering the stacks.
“It’s what neighbours used to be like, and it’s a massive cost saving. We harvest the silage for about 5c/kg,” Cam says.
It was the start of a budding relationship that became an equity partnership for Cam and Jess to go sharemilking.
Cam proved to Andrew and Kelly along with his neighbours that he was reliable and a sound investment.
Cam showed he could do the hard yards and he had a spectacular work ethic, Kelly says.
Andrew and Kelly own a dairy farm and have investments in kiwifruit and avocados. They knew Cam was a good investment to back, but more than that they wanted to help someone into the industry.
“It’s not like any of us investors thought we would make a million dollars out of it. It is a reasonable investment, but it’s more about giving them a break,” Andrew says.
“He’s very capable, he came from a contracting background and he’s very practical and very researched. He has a lot of ability but didn’t have family backing.”
The cash investment by each farm owner wasn’t huge in the scheme of their own businesses but it was a way they could help the next generation. Cam and Jess did all the hard work and put forward thorough budgets and a plan, Kelly says.
“I don’t understand why more dairy farmers don’t do this with their workers,” Andrew says.
In an industry that’s only getting older, the only way to get young people into the industry is to help them, people can’t do it on their own, he says.
Dave and Nat Wilson had been in a previous equity partnership, so their knowledge and skills were pivotal in setting up the finer details of the contract, Cam says.
The farmers have agreed to keep their investment in for five years and then after that it’s up to Cam and Jess what they want to do.
“We will see where we go from there, we can either buy them out or keep their money in and get a bigger job, or something that will give capital gain,” Cam says.
Cam has almost completed the Diploma of Agribusiness through Primary ITO, which along with Colin, was pivotal in understanding business structures and budgeting that allowed he and Jess to develop their business plan and goals.
“I hold Colin and my agribusiness tutor Gillian Searle in high regard with the teaching and mentoring of the finer details of operating a business.”
- More? See NZ Dairy Exporter, May 2019