Pal’s Mushrooms is having to pivot in order to keep the business afloat. They had been farming for years, invested a couple hundred thousand, but ran into costly operational issues. Jeremiah McCoy, the farm manager, is working with the team to get the operation on track. They are stepping away from gourmet mushrooms and stepping into medicinal psilocybin mushrooms.
Pal’s Mushrooms’ Background
The Pal’s facility was established in 2011 by The Portland Mushroom Company to grow local culinary mushrooms. They use fruiting and inoculation chambers designed from insulated shipping containers. Their peak production was over 250 lbs of fresh Oyster Mushrooms per week. It was sold and rebranded as PALS Mushrooms in 2018, and in 2021 PALS was bought by a collective of investors and mycologists.
The current owner, Chris Peircean, put together a group of investors back in the spring of last year. They created a fund to buy the farm. They had a mycologist expert who was supposed to be the farm manager, but it didn’t work out due to health issues.
Pal’s ran into different issues with the equipment, and production fell way behind. Chris then brought Jeremiah Mccoy on in November 2022. Jeremiah has experience fixing small businesses and had spent the last six years working in a couple of food beverage businesses up in Bellingham, Washington, and then a small, nonprofit maker space.
McCoy took a step back to analyze where Pal’s was losing money
- Equipment problems
- Recipe problems
- Cost of labor
Some staff volunteered to keep the company running, and it looked like they were going to have to close the farm down. But now it looks like things are turning around! Pal’s is open to exploring the psychedelic therapy industry as it opens up in Portland, Oregon. The plan is to get all new equipment and grow extra sterile.
Alex, one of our former employees, came up with an offer for the gourmet mushroom. He has proposed to make Pal’s Al’s – a nonprofit, a community food resource. Really, it would be an offshoot of Pal’s brand. Since his name’s Alex, he thought Al’s Mushrooms would be a good name. The idea is to turn it into an educational center to teach people how mushrooms grow and provide food for the community. And it makes sense because the current farm’s location is about to be purchased by a nonprofit collective.
Danielle: What are the top five issues people need to watch out for starting a mushroom farm?
Jeremiah:
- It takes longer than you think
- Have enough budget so that you don’t run out of money
- Keep in mind that mycology is one thing; growing in a particular environment is an entirely different thing
- Understand the importance of the cost of labor and goods
- Pay close attention to pricing your mushrooms properly
Selling to grocery stores versus direct to consumers can make or break a mushroom cultivator’s business. Selling wholesale and selling retail takes the same amount of work, but selling straight to the customer is way more profitable. Poor growing practices can be a deal-breaker as well; for example, Pal’s originally used buckets and had major contamination issues. Finally, the substrate recipe is key. Not every varietal thrives on the same substrate.
Jeremiah urges beginner mushroom farmers to start off small and, most importantly, find a mentor that is someone with creditable experience.