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Anthony MacDonald's Blog

 

Bolstering investment with fractional ownership

Published: January 27, 2016 6:12 pm ET

Last Comment: February 2, 2016 1:07 pm ET | 11 Comment(s) | Jump to Comments

There are many problems with our industry as we all know.

We have lost horses that we can't replace.
We have lost investors to other jurisdictions that don't appear to be in any hurry to come back, and we all know people who have left the game, likely never to return.

Where does that leave us?
Where does this leave horse racing?

I myself have written about many topics that I consider to be "fixable" problems within our industry.
Doesn't mean I'm right.

We have small and large groups of people who also have ideas on how to fix our industry.
We shouldn't throw stones at anyone putting such an effort into presenting a viable way forward.
I applaud them and you should also.

So in light of this, I figured I'd touch on the other side of the industry.
Rather than writing about the government, it's perceived shortcomings, or how I would do things different.
I wanted to instead focus on horsemen.
What we need to do and how we need to do it moving forward for us to slow, if not stop this free fall.

As most of you know my wife Amy and I started thestable.ca at the end of the summer.
A fractional ownership website of sorts, but with a twist.
There are no upfront fees, and we receive no money on sales or purchases.
We worked hard to procure content for this website.
The timing was poor to secure consignors, investors, and owners for a fractional ownership website, but through hard work and help from some friends both old and new we were able to secure 23 yearlings to break and train down.

Like a true foolish horseman I did what I was well aware I shouldn't.
Our mortgage was up for renewal and we took a portion of equity out of our home to seed this unproven venture.
We all need our significant others behind us and my wife was right at my side.
Working her butt off and shockingly encouraging this apparent lunacy.

With only a few rough ideas put down on paper I started out.
Calling, emailing, and meeting with perspective investors and breeders who thought this truly was, and would be a better way to buy and sell yearlings.
Our website was open, easy to use, understand and navigate.

The sales came and went and then the hardest part began.
Who would buy these horses?

We advertised with SC, the USTA, HRU, and anyone else we could afford.
We had no marketing budget so everything was right out of pocket.

We were offering to sell shares of horses as small as 1 per cent. But who would want 1 per cent of a yearling?

Well, luckily everyone.

I had emails immediately, from New Jersey, New York, Pennsylvania, Ohio, North Dakota, British Columbia, Alberta, Winnipeg, Ireland, the United Kingdom, new Zealand and so on.

As Christmas approached we had 26 investors in two continents for 12 horses.
Some horses had already been sold and although the new owners left the horses with us to train, they didn't feel the need to reprice them immediately.

Then people started buying pieces of horses for loved ones for Christmas.
A UPS driver from Florida bought two per cent of a horse for his wife.
A lady in Ottawa bought 1 per cent for her dad.
Four per cent of a Majestic Son filly for a mother and son in Toronto (thank you Garnet) and 1 per cent to a couple in the GTA, just because.

Then the most incredible thing happened, I came to the barn to train on a Saturday and 15-20 people were there.
It was cold and damp but these people, now owners, came to see their horses.
The couple that bought one per cent, brought five grand kids, their daughter and son-in-law and themselves.

You see as horsemen we were born into this, and along the way we forgot how interesting it is to be an owner.
To see a horse on the track and know it's yours.
The majority of the general public couldn't afford to own a horse before, but we just made it affordable.

Imagine if we sold 100 per cent of a yearling, 1 per cent at a time and every person came with such an entourage?
We would need buses for ownership groups to go watch their horse race.

You see we have always had the commodity to grow this industry exponentially, but we couldn't see the forest for the trees.
Fractional ownership isn't new, syndicates have been around for ever.
Thestable.ca and sites like it to come will make it easy to be an owner, to be able to budget without hidden costs.
To experience the best part of our game will be invaluable to everyone involved with this industry.

We get happy owners who can budget and know what they can afford.
Our industry gets an infusion of revenue, but even more importantly, an infusion of optimism.
These people won't show up and ask for two per cent of a beer or one per cent of chicken wings at the racetrack this summer.
They will show up with friends and family to watch their horse race and we will be happy and excited to see them.

I've seen the Analytics from our site.
I know how many people visit, and for how long they stay on the site.
I know when they come back and what they look at on the site.
I've talked to the people that are interested in investing,
They are just everyday people excited to be included.

When we finally figure out how we need to disperse our money properly so we can race for fair purses across this great province.
When we find a better way to track our horses in the province so we know what we have and what we need.

When we finally have one singular voice for horsemen in Ontario, this site and sites like it will hopefully have compiled a new wave of owners.
Eager, enthusiastic, and hoping and praying to walk into the winners circle on race night.

We have reasons to be optimistic about our future.
The Stable makes me feel like this guy I once saw on TV
Who knows, some of us could all turn out to be a lot like him?
Do you remember him.......

"Come and listen to a story about a man named Jed
A poor mountaineer, barely kept his family fed,
And then one day he was shootin' at some food,
And up through the ground came a bubblin' crude."

Come out Saturday night to our open house at Woodbine. See what thestable.ca has been up to. Listen to what fractional ownership brings to our industry and see if it's something that may be a good fit for you.

Anthony MacDonald


The views presented in Trot Blogs are those of the author and do not necessarily represent those of Standardbred Canada.

February 2, 2016 - 1:07 pmJust curious.... why does

Will Yamakva SAID...

Just curious.... why does everyone say, "you do not know the side of the business"? I have many friends that own and train horses, its not like I am in the dark, and I do see when they enter and what not, but you can't act like this is going to bring out new people. If so, tracks like Dresden and Hanover would be packed with the family and friends of the owners of these horses. That simply does not happen. I totally see how excited they get, but let's keep it real, for every owner that has a great time, and their horse makes money, how many have lost? How many never see a return on that investment?

And while horse people here see this as "fun" or a "hobby", it's asking a lot for someone who does not see this as a hobby or is new to the game to just put up cash, and not show the pros and cons, and the wins and losses that are possible here.

Again... I love the idea, but the more information out there, the more informed people are about what they are spending the money on and how it might come back.

January 31, 2016 - 11:52 amAnthony, This is a great

Anthony, This is a great idea, and I'm very impressed with the quality of the website. Keeping owners in the loop on how their horse is training down with drone videos, and stable notes, is extremely important. As you said, people just want to be a part of the game, and be included.
Its also a great way for new owners to get their feet wet, and learn the industry without a huge investment. A 1% owner who's horse does well this year, may invest 10% next year.
This will definitely result in more people at the tracks as well. Owners want to watch their horse race! Even if they only have 1% of it.
Personally, I look at horse ownership as a fun hobby, like golf, or going to sporting events. Return on investment is great, but its secondary to the fun and excitement of being involved in the sport.

January 31, 2016 - 10:39 amAnthony- GREAT idea, GREAT

Dave Snowden SAID...

Anthony- GREAT idea, GREAT advertising, Well written

Will- You comment on a lot of articles (great as it creates discussion)and you have good ideas about looking after the customer and promoting the sport. Meadowlands is a good example to follow, there are others. BUT, you obviously have never owned a horse and do not understand our side of the business. Let me guess at ROI on these horses to date. They are yearlings just turned 2 in January. They were broke last fall and can't physically be fit to race until late spring of their 2 year old year. So ROI is zero. A percentage will be too immature to race this year and will need to start racing at 3. I have had horses for 40 years so I estimate that over 50% of these will lose money but you are always looking for the home run - example He's Watching- a $3,000 yearling making $1.1 million and now standing stud.

You enjoy watching races, well there is going to be a major shortage of horses to race in 2016/2017 (foal numbers have been cut in 1/2 in North America) so you will be betting on short fields. We need more people to realize the fun of owning a racehorse as well as the fun of betting them.

As a side note: years ago there was a fan at KD that never owned a horse so I asked him if he wanted to buy in on one. He did, his family was horrified he was wasting money. He came out to watch him train down, he did not race at 2 so he had to pay bills until 3. He won his first start and the thrill on that man's face could not be put in dollars. He never missed a race for the next 2 years but unfortunately passed away. AND yes, when all was settled up he made money and had a thrill of a lifetime.

January 30, 2016 - 12:55 pmI just want to thank Anthony

Garry Law SAID...

I just want to thank Anthony and Amy for this fantastic concept they have come up with. It certainly is a step forward to help our sport. I think the two things I value as an owner in the stable is honesty and hard work which attracted me to them. I'm sure this will attract new people which is what we need. Anyone who wants to get a share in a horse doesn't have to worry about anything as its all laid out for them. Anthony always gets back to me regarding any questions I have and again it's really refreshing to get honest answers to my questions. Again thanks Anthony for starting theStable for the little guy.

January 28, 2016 - 11:16 pmIn today's day and age, the

Will Yamakva SAID...

In today's day and age, the idea of not getting a return on an investment is going to put people off. Also, it is not reasonable to think more owners means more people at the tracks. Take a look at the Meadowland's model, they did not go after more people owning horses, they made the product better and what young people can afford. Not many young people are going to have a couple of grand, but they can go out for a few hundred and be in a giant sports bar/entertainment/racetrack facility.

That being said, I do like the idea at play here, but being one of those 9-5ers that does not have a few grand to toss around on horses. A return on investment would be a MAJOR factor in me investing in something like this.

January 28, 2016 - 6:05 pmIts great this type of

brad snel SAID...

Its great this type of syndication is available to people who are either new to the business, or otherwise couldn't afford a yearling to hopefully compete on the harness racing circuit.

Ive been involved in the horse business since the days of Greenwood and working for such notable horsemen such as Bill Wellwood, John Burns,to name a few and learning from them training techniques, shoeing , rigging up horses and looking after sore race horses to keep them competitive on the circuit.

Had a few cheap but competitive horses racing on the b circuit back in the day at Orangeville, Elmira, Barrie Raceway, Flamboro and various fair tracks and never had this kind of opportunity to get in on the ground floor to a possible contender for the oss stake year or the New York Stake circuit.

Getting those yearlings to the races is a long shot for sure, but the availability of actually watching your yearlings train via the internet and drone technology is groundbreaking to say the least and all in the comfort of your own home.

The Stable also offers the chance to watch your horses train on weekends or through the week at the training center or if u cant make it you can always catch them on Facebook or The Stable website.

In my opinion, a great way to bring new investment into the business.

January 28, 2016 - 12:44 pmKudos Anthony!!! More

Kudos Anthony!!! More owners=more fans=increase wagering=more people at the tracks. This also brings potential younger owners and a younger crowd to our sports...Way to think outside the box, congrats to you and your team for this new venture and good luck!!!

Mr. Yamakva, not everything is about ROI, A hobby often cost a few bucks either playing hockey or just going to see a movie. What Anthony is selling is the thrill of owning a racehorse. If you never have, try it, there is nothing like it!!!!

January 28, 2016 - 12:56 ami am more than curious.....

Will Yamakva SAID...

i am more than curious..... do you post what each owner has made on that investment? I think THAT would encourage more people to join. This article was great, but if you are asking people to fork over a few hundred/thousand you should show a ROI that would be encouraging to others.

January 27, 2016 - 8:51 pmAnthony as far as the

Gregory Peck SAID...

Anthony as far as the analytics of the stable.ca I should appear often. I check it lots and walk several people though. This is a terrific idea. The drone and interviews are great. You and your wife should be proud and I commend everything you do to encourage ownership. Most of all, who else would have the patience to accept a 1% purchase ? You are the epitome of the saying "it's a marathon, not a sprint." The Industry should be thankful and I know lots who have voiced so. Keep doing what you're doing.

January 27, 2016 - 8:19 pmGreat article Anthony You

Great article Anthony

You nailed it with your innovation in the style of ownership. You are correct in stating that syndicates have been around for generations but they are generally only affordable to wealthy investors thus eliminating new blood being introduced to the industry.

Your model brings in average people, at an affordable price, of which many are newly introduced to the sport. I thought of a similar idea, albeit on a much smaller scale than yours, but it is ideas like this that are truly some of the only positive things being created to introduce new people to the industry. Being from the small Town of Truro, I was also influenced by the two groups which have came from this area and hit their gold with their small investments. (Somebeachsomewhere and Wakizashi Hanover, for those not familiar with Truro)

At the end of the day, just being able to take some friends to the track to see your horse race in a stake race of any sort would be awesome. To be lucky enough to take them to a super final or North American Cup would be amazing. Who cares if you only own 1 percent of Wiggle It Joggle It, for example, being able to say my Horse just won the Little Brown Jug or similar would be an experience you never forget. After all, as a fan, we are often amazed at being at these events and we don't even have a horse racing in them so that added potential allure definitely will get people interested in getting into the market. Better than that, if you have 100 - 1% owners you are not getting 1 or 2 people but hundreds with all their family etc.

Great Work and Innovation
Trevor Otterson

January 27, 2016 - 7:22 pmWell said Anthony. I still

Dave Webber SAID...

Well said Anthony. I still would be sitting on my couch this weekend if it wasn't for thestable.ca. What an adrenalin rush seeing a horse you own a part of on the training track. Dave (new investor)


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