Owning Thoroughbreds Is an Expensive Gamble Offering Great Rewards--and Costly Losses
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"I have partners in every one of my horses. I get my friends involved; it's just more fun that way," Biszantz says. "It's like we're all partners in our own pro franchise. When we all go down to the winner's circle, it's the best thrill there is, and the wonderful thing is, it never changes. It doesn't matter if it's your first winner or your hundredth."
In spite of racing's emotional appeal, Biszantz cautions new owners to keep their minds on business. "You've got to establish your goals and you've got to have a business plan. Ask yourself if you can comfortably spend $20,000 a year to keep a horse in training," he says. "And I recommend that as you grow in the business, diversify. Have some claimers, some two-year-olds, some grass horses." (Claimers are horses that can be purchased, or "claimed," at a set price.)
With two trips to the Kentucky Derby winner's circle, Joe Cornacchia has been successful enough to strike out on his own, yet he, too, prefers partnerships. "In partnerships you can share the risks and own more horses for the same amount of money," he says. "With more horses you stand a better chance of getting one or two good ones."
For Glenye Cain, a partnership wasn't so much a way of spreading the risk as it was a way of getting in the game. Formerly a Dogwood Stable employee and now news editor for the Thoroughbred Times, Cain realized her dream of thoroughbred ownership by spending under $2,000 for 5 percent of a two-year-old named Trail Dust, who races in the colors of trainer Clint C. Goodrich.
"I didn't want to take a huge plunge with my life savings," she says. "At five percent my influence is limited, but I'm always asked for my opinion. And when I arrive at the barn in the morning, Clint will say, 'Bring out Glenye's horse.' I never think that someone else owns him. Even if you own just five percent, you're still a racehorse owner. That still carries a lot of weight. Take a friend out to the barn with you in the morning. He'll be impressed."
As a 5 percent owner, Cain gets 5 percent of the bill for the upkeep of Trail Dust. "It's been very manageable--never more than $125 a month," she says, adding that "it's opened up a whole new world. There's nothing like owning your own racehorse. The competition puts a spark back in your life. And it's not just me. The risk and gamble of racing seems to appeal to the kind of people who have had everything under their control for so long."
Racing syndicates have their critics, however; trainer and TV racing analyst John Veitch is among them. The son of National Museum of Racing and Hall of Fame trainer Syl Veitch, John is a member of the old school of racing. On his old school tie are the colors of Calumet Farms, for which he trained the likes of Alydar and Davona Dale, and Darby Dan Farm, for which he conditioned Breeders' Cup Classic winner Proud Truth and Eclipse Award winner Sunshine Forever.
"Not to throw cold water on the concept of limited syndication, because it allows people of means but not of wealth to play a part, but with syndicates the trainer becomes more of an entertainer for a huge group of owners," says Veitch. "Back at the barn it can turn into a real dog and pony show for a constantly changing cast of characters. I liken the situation to a serious operation where the extended family shows up to interrogate the surgeon and in the meantime the patient expires."
Veitch also doesn't buy into the "it's-like-owning-a-pro-sports-franchise" analogy. "No, it's not like owning a team. To the fan of a team it's a sport, but to the owner it's a business. There's admissions, parking, hot dogs to sell," Veitch says. "Owning a racehorse is a vicarious thrill. It's like paying for a fine meal and watching someone else eat it."
No matter how they are owned, thoroughbreds are acquired through one of three sources: auctions, private sales or claiming races. For many, the real action in the thoroughbred game is in the auction sales ring. The highest profile American sales are the yearling auctions at Keeneland in Kentucky in the spring and at Saratoga Springs in upstate New York in the summer. For three evenings each summer, the epicenter of the racing world shifts a few furlongs down East Avenue from the Saratoga Race Course to the Humphrey S. Finney Pavilion, a concrete amphitheater that houses the Fasig-Tipton Saratoga Select Yearling Sales. During the day, owners, trainers and bloodstock agents search the sales grounds in search of the classic winner, checking out conformation (the horse's physique), pedigrees--and each other. In the evening, they gather in the bi-level semicircular sales pavilion to focus on the cream of the yearling crop, one horse at a time.
"Next in the sales ring, hip number 127," intones announcer Terence Collier as a baffled, but buffed, son of a leading sire enters the sales ring, led by a white-jacketed handler and followed by a similarly attired man with a shovel to clean up any...unpleasantness...that hip number 127 might leave behind. The horse is scarcely a year old and as close to perfect as breeding and meticulous grooming will allow. His seamless topography is interrupted only by a generic label about the size of a credit card bearing black numbers on a white background, which is pasted on his hip--his hip number, by which he will be identified during the sale and which indicates his order of appearance in the sales ring.
Auctioneer Walt Robertson, the sales' play-by-play man, is seated on high with Collier, who serves as his color commentator. Sounding as though he is speaking in tongues, Robertson warbles away in the sing-song auctioneer's patter, reminiscent of the old cigarette commercial set at a tobacco auction that ended in the call of "Sold American!"
Out of Robertson's patter emerges the sound of money. "$50,000...55,000...60...65,000...70...75,000...." Tuxedo-clad spotters scan the hall tracking the subtle signals of the bidders and barking out when they find someone ready to up the ante. "85...90... 95,000...."
The bidding slows, so the color man commandeers the mike. "That's an awfully low price for a colt of his pedigree. As good-looking an individual as you'll ever see, a half-brother to a classic winner, from a female family that produces nothing but runners, could be any kind, and really should be getting more than this," Collier pitches, and the bidding rebounds.
"$100,000...$105,000...110...115...115...115...115 once, twice," says Robertson, and with an authoritative bang of the gavel adds, "Sold for $115,000!"
Joe Cornacchia thrives on auction action. "The sales are nerve-wracking, exciting and one of my favorite parts of the game," he says. "[Trainer] Nick Zito marks up my catalogue with 30 or so horses that he likes. Other people know that so they watch me to see what I do." To avoid this surveillance, Cornacchia will go outside the building and make his bids through a spotter stationed inside. "A couple of years ago, we were interested in a colt and decided we'd go as high as $140,000 for him," Cornacchia recalls. "When the bidding got that high we decided to go $5,000 higher. The bidding kept going up, so we said let's take one more shot and go to $150,000." They won the bid. The colt was Go for Gin, the 1994 Kentucky Derby winner.
More than 8,000 yearlings are sold at auction each year in the United States and Canada. By buying a yearling at auction, you have the advantage of having extensive pedigree and veterinary analysis at your disposal, but you are still bidding on an untested commodity, which has yet to feel a saddle on its back. The yearling's first race is probably a year away and the risks are high, but with the risks come the greatest potential for reward.
Sunday Silence was purchased as a yearling for $17,000. He went on to win two-thirds of the Triple Crown--the Kentucky Derby and the Preakness--and the Breeders' Cup Classic and retired with career earnings of $4,768,554. Seattle Slew went for $17,500 and became one of only 11 horses to win racing's Triple Crown, in 1977. Alysheba fetched a respectable $500,000 as a yearling, and went on to bank $6,679,242 to become the sport's leading money winner when he retired in 1988; he was recently overtaken by Allen Paulson's Cigar, the Horse of the Year for 1995, whose victory in the Dubai World Cup on March 27--his 14th straight-- raised his career earnings to $7,669,815.
These examples, however, are exceptions to the rule for trainer Clint Goodrich. "A Keeneland yearling is like a new car off the lot. Its value instantly starts to deteriorate. Most horses will never be as valuable again as they were the day they were sold as yearlings."
Besides the prime Saratoga and Keeneland yearling sales, there are two-year-old-in-training sales, horses of racing age sales, mixed sales, dispersal sales and sales of restricted horses bred in particular states. "I like the two-year-old-in-training sales," trainer John Kimmel says. "They are a happy medium between yearling sales and claiming horses. In the two-year-old sales, conformation loses some of its luster. Instead, you can get a sense of how they move, because you get to see them on the track." If you buy a two-year-old-in-training, you may be getting a horse that is very close to its first race. This would get you into the game far quicker than buying a yearling will. You are buying a more defined product at a price that tends to be a more accurate reflection of its worth.
Regardless of the type of sale, auctions have inherent advantages. Bloodstock agent MacDonald says, "There are a lot of pluses to buying horses at auction. One is that you get a large population of horses in one place. Auctions can be a great opportunity if you do your homework and your legwork." The homework includes setting a budget, studying the auction catalog and estimating prices, contacting an adviser who knows the setting and making firsthand inspections with him. You'll also need to make arrangements with a veterinarian for pre- and post-sale exams, establish credit with the sales company, find a place to board and train the horse (it's yours after the sale) and arrange transportation to that location.
Many of the horses sold at auction will change hands later through private sales, just as the legendary John Henry did. To arrange a private sale, you'll need to work with a bloodstock agent who really knows the game.
For the past 33 years, Joe Brocklebank has been a regular visitor to the Belmont Park paddock, where the horses are saddled before each race. From 1963 to 1982, he wore the colorful garb of a jockey and had his eyes on winning races. From 1982 on, he has worn the business attire appropriate to a bloodstock agent, and he has been on the lookout for value. "I'm someone who puts A and B together, buyer and seller, just like in real estate," says the Irish-born Brocklebank, president of Erin-American Bloodstock. "I'll ask the buyer, 'What would you like to spend and where would you like to race?' and then I'll try to find a horse that matches."
Being a good matchmaker requires Brocklebank to read all the industry publications and travel to tracks around the country to see prospective purchases in the flesh. "I like to see a horse run before I recommend it to a client," he says. "I watch the horses train in the morning and spend time where the trainers congregate. I stay in tune with what's happening." Brocklebank's job is easier when the prospective buyer is also in tune. "I like an owner that says, 'Get me a horse that can run at Aqueduct in the winter and I want to spend $50,000 on him.' I deal with all kinds of price ranges, but the people at the higher end tend to be easier to work with."
When his efforts succeed and a sale is concluded, Brocklebank receives a 5 percent commission, which can come from either the buyer or seller. In Brocklebank's view, a buyer should always be ready to become a seller. "I should keep a count of all the people that I offer fair market--more than fair market--value for a horse and they decide against selling," he says. "The percentage of them that profited by not selling is minuscule." Brocklebank deals primarily with sole owners. "Partnerships might be a good step for some people, but I've seen a lot of partnerships dismantle," he says. "You know the old saying: 'A partnership is a bad ship to sail on.'"
Horses sold privately are usually ready to race, giving the buyer a quick entrée into the action. The potential buyer can see the horse run and conduct a thorough veterinary exam. There is time for rational evaluation, as opposed to the hyper-emotional, competitive nature of auctions. A typical private purchase requires an inquiry to the current owner, an inspection, the negotiation--which should include a thorough study of the pedigree and race record--and, finally, a written Agreement of Sale and Purchase. It's probably not a bad idea to do a lien search, and of course demand the horse's Jockey Club certificate before closing the sale. (The Jockey Club is an organization that serves as North America's thoroughbred registry.)
Racing has various levels that open up as you get inside that world. One of the most peculiar and pervasive is the claiming game. Seventy percent of races run in the United States are claiming races, and they offer a route into thoroughbred ownership best left to the wise guys. Here's a dry, dictionary-style explanation for the quirky, colorful and sometimes cutthroat claiming game: In a claiming race, each horse entered is eligible to be purchased at a set price. The price is set by the racetrack. Claims must be made before the race by licensed owners or their agents who themselves have a horse registered to race at that meeting. When a horse has been claimed, its new owner assumes title after the starting gate opens, although the former owner is entitled to all purse money earned in that race.
It's an odd system, but it's the main mechanism by which competitive races are created through matching horses by their perceived financial value. In a typical $25,000 claiming race, you might find a few horses that have been running at that level with moderate success, a couple that have been running with little success at higher claiming prices, one that might be coming off a big win at a lower claiming price, as well as a mystery horse that has been running in much classier races.
Let's look at the mystery horse: He's got a clear edge in class, good breeding--on paper a bargain for $25,000. Yet why would his owners risk him in a claiming race? Are they desperate for a win or are they trying to unload damaged merchandise? Why was the horse wearing front bandages? Is he nursing an injury, or are they trying to make it look as if he has leg problems to scare off a claim? Or is he a decent horse that just doesn't fit his owners' goals? Strictly a game for wise guys.
Claimers have painted vivid colors into the thoroughbred landscape. Princequillo, claimed by Hall of Fame trainer Horatio Luro for $2,500 in 1942, developed into one of the best long-distance runners of all time and retired to become one of his era's top sires. Also in the '40s, a thoroughbred named Stymie ran in 14 rock-bottom claiming races before winning his first race. Trainer Hirsch Jacobs was an admirer of Stymie's paternal grandsire, the great Equipoise, so he put in his claim when he saw the horse running for a $1,500 tag. Stymie went on to win 35 races, 25 of them stakes, and retired in 1949 with then-record career earnings of $918,485. A race was later named for him at Aqueduct racetrack in New York.
If you're still interested in making a claim, heed the caution of Hall of Fame trainer Allen Jerkens, who says, "If you are going to claim horses, you better claim quite a few. That way the good ones can overcome the bad ones." Even Jerkens can't always tell the good from the bad. "Horses, being what they are, make a monkey out of you sooner or later."
But even the threat of embarrassment is unlikely to stop the avid horse owner. Once hooked, you are hooked forever. After all, nothing can take away the thrill of hearing "They're at the post" when your horse is in the starting gate.
For Further Information: The Blood-Horse (800/866-2361) and Thoroughbred Times (606/260-9812) are published weekly and cover all aspects of thoroughbred racing and breeding. Daily Racing Form (800/306-FORM) is a national newspaper published in an array of regional editions. It provides past performance information on the horses running at various tracks as well as news. Thoroughbred Daily News (908/747-8955) is a daily faxed to its subscribers, with breaking news and coverage of national and international racing. Many state breeding associations also publish magazines. A prospective owner should read Ainslie's Complete Guide to Thoroughbred Racing by Tom Ainslie (Simon & Schuster), a comprehensive and frequently updated guide to the sport. To learn more about the TOBA Prospective Owner Seminars and other related programs, or to receive a brochure entitled "Buying Your First Racehorse," contact Ann Stiltz, owner projects director, at 606/276-2291. Thoroughbred Racing Communications (212/371-5910), racing's national media relations office, can also help steer you in the right direction.
John Lee, a New York-based writer, has lost money at 29 racetracks around the world. A Guide to Thoroughbred Terminology