Execution gates — financial thresholds (phase advances)¶
Purpose¶
Consolidate pass/fail financial criteria for advancing the East Tennessee two-site plan across business phases 0–4 (see 10-year roadmap). These financial gates sit beside—do not replace—research gates V1–Vn and decision gates G1–G3 in Validation backlog and major-spend gates in Validation backlog — before major spend.
Detail pages: Revenue milestone model (milestones M0–M4, bridge years), Enterprise unit economics (contribution margin and labor tests), CAPEX, OPEX, and enterprise sequencing (spend, debt, unlocks).
Rules: No fabricated dollars—every threshold is a named placeholder to be filled from books, quotes, and lender constraints. Optimism-driven spending fails by design if evidence columns are empty.
Identifier map¶
| ID | Meaning |
|---|---|
| Fin-G(0→1) | Financial permission to treat Phase 0 work as complete and enter Phase 1 spend posture |
| Fin-G(1→2) | Permission to unlock Phase 2 CAPEX / herd scale posture (with G1) |
| Fin-G(2→3) | Permission to scale or add second stream (with G2) |
| Fin-G(3→4) | Permission to use salary-replacement narrative and Phase 4 architecture (with G3) |
| M0–M4 | Revenue milestones—Revenue milestone model |
| FC* | Financial condition rows in tables below—boolean once filled |
Fin-G(0→1) — Phase 0 complete → Phase 1 allowed¶
| # | Criterion | Pass logic | Evidence |
|---|---|---|---|
| FC0.1 | Baseline ledger | M0 = Y (12-mo household + farm cash picture started) | Export / accountant attestation |
| FC0.2 | Household need bounded | HH_NEED filled as range [HH_LOW, HH_HIGH] or single placeholder with review date |
Family worksheet |
| FC0.3 | Stop rules numeric | Vision stop rules debt / automation thresholds use placeholders D%, N weeks—not blank prose |
Written table |
| FC0.4 | Working capital floor (homestead + farm ops) | WC_MONTHS_MIN_P0 ≥ ___ months liquidity policy documented (not necessarily achieved—policy must exist) |
Policy memo |
| FC0.5 | No salary claim | No document in fundraising/lender pack asserts salary replacement—narrative quarantine per revenue milestone page | Checklist |
Aggregate pass: Fin-G(0→1) = FC0.1 ∧ FC0.2 ∧ FC0.3 ∧ FC0.4 ∧ FC0.5.
Fin-G(1→2) — Phase 1 → Phase 2 (operating business posture)¶
| # | Criterion | Pass logic | Evidence |
|---|---|---|---|
| FC1.1 | Research G1 | G1 = PASS (V1–V4 minimum + legal use)—non-financial prerequisite | Validation backlog |
| FC1.2 | Bridge years explicit | Bridge table in revenue milestone model has rows for each planning year touched—no hidden subsidy of farm by household | Same page |
| FC1.3 | Unit economics sanity | For each active enterprise row in worksheet: CM_X computed; MVCM test documented—Enterprise unit economics §MVCM |
Worksheet |
| FC1.4 | Split-site burden bounded | R_SPLIT = split-site incremental $ / positive contrib margin denominator—policy: advance only if R_SPLIT ≤ R_SPLIT_MAX or exception logged |
Worksheet |
| FC1.5 | Major fence/water/herd CAPEX | Only if G1 and Fin-G(1→2) and line tied to capex unlock matrix |
Capital phasing table |
Aggregate pass: Fin-G(1→2) = FC1.1 ∧ FC1.2 ∧ FC1.3 ∧ FC1.4 (FC1.5 applies per CAPEX line).
Fin-G(2→3) — Phase 2 → Phase 3 (scale / second stream)¶
| # | Criterion | Pass logic | Evidence |
|---|---|---|---|
| FC2.1 | Research G2 | G2 = PASS | Validation backlog |
| FC2.2 | M2 contribution margin | CONTRIB_MARGIN_Y > 0 for at least one full calendar year Y or documented explicit subsidy with end date T_SUBSIDY_END |
P&L |
| FC2.3 | Labor-charged materiality | M3 worksheet complete (family shadow rate band + hours)—even if M3 dollar target not met, inputs must exist to fail consciously | Labor log + worksheet |
| FC2.4 | Trailing margin stop | Not two consecutive years negative operating cash after labor charge—else freeze per Vision |
P&L trend |
| FC2.5 | Debt service | If any new term debt since Phase 1: DSR = debt service / gross farm revenue ≤ DSR_MAX or stop scale |
Lender schedule |
Aggregate pass: Fin-G(2→3) = FC2.1 ∧ FC2.2 ∧ FC2.3 ∧ FC2.4 ∧ FC2.5.
Fin-G(3→4) — Phase 3 → Phase 4 (salary-replacement narrative)¶
| # | Criterion | Pass logic | Evidence |
|---|---|---|---|
| FC3.1 | Research G3 | G3 = PASS | Validation backlog |
| FC3.2 | M4 salary band | Farm cash ≥ FARM_SHARE_TARGET × HH_NEED for N_M4 consecutive years (placeholders) |
Bank + books |
| FC3.3 | No premature salary claim | M4 row filled—executive summary / external narrative may only use salary replacement language if Fin-G(3→4) PASS | Milestone table |
| FC3.4 | Benefits / off-farm | If health or benefits require off-farm work: explicit line in milestone model—no “full quit” claim | Written |
Aggregate pass: Fin-G(3→4) = FC3.1 ∧ FC3.2 ∧ FC3.3 ∧ FC3.4.
Crosswalk: financial gates ↔ validation gates¶
| Financial gate | Requires (non-exhaustive) |
|---|---|
| Fin-G(1→2) | G1 + bridge + unit economics |
| Fin-G(2→3) | G2 + M2/subsidy rule + labor worksheet + DSR |
| Fin-G(3→4) | G3 + M4 |
On failure¶
| Gate fails | Action |
|---|---|
| Fin-G(1→2) | Defer Phase 2 livestock/fence scale CAPEX; continue Phase 1 intelligence; no blame—update evidence |
| Fin-G(2→3) | Freeze scale; Recommended enterprise strategy fallback posture; remediation remediation backlog |
| Fin-G(3→4) | Do not claim salary replacement; do not expand debt for lifestyle CAPEX |