Ownership

	Benefits of a Racing Partnership The greatest benefit of any partnership is experience in the business—experience that will allow an owner to be more successful and experience fewer setbacks. From setting goals to choosing horses and trainers, racing successfully is the most complex, difficult task you may ever undertake. So difficult, in fact, that many choose to breed to sell instead of race or quit training to pinhook so that they can stay in business but transfer the risk to someone else. To be successful requires finding and eliminating errors one after another. Many do not stay in business long enough to do so. A partnership can shorten this learning cycle substantially. The other great benefit of partnerships is to reduce the financial investment required and spread the risk in each horse among many. The majority of horses do not make money, however, those that do can make so much money that the IRS has ruled that the risk is tax deductible. One way to make money in racing is to spread the risk over numerous horses, either simultaneously or sequentially, until you hit the one capable of making substantial income. Racing expenses are tax deductible if certain guidelines are followed. See the following link for more information: http://www.toba.org
	Understanding Racing Many believe they are emulating those who are successful in racing. The problem is, they don't understand how their goals differ from those of the people they're emulating. The result is that most owners are not doing what will make them successful. Let's start with why buyers are willing to spend $300,000 to millions of dollars on certain yearlings. Most horses bought at that level are investments purchased for their residual breeding value should they be successful on the track. They aren't expected to earn back their purchase price plus expenses - their true earning potential is in the breeding shed. Buyers at that level are willing to risk large sums of money in hopes of finding the next Storm Cat or Mr. Prospector. While more stakes winners do come from these ranks, these purchases are still major and very expensive risks suitable only for those who can absorb losses at that level. Here at Flying Dutchman Thoroughbreds we always aim for the highest level of success, much like the investors mentioned above. But at the end of the day, while spending more may increase your likelihood of winning at the track and turning a profit, it guarantees nothing. Two years ago a horse named “The Green Monkey” was purchased for 16 million dollars—to this day he still hasn’t run one race! Since most of FDT’s horses are home bred, raised and trained on those same farms we don’t need to over-charge to hope for big profits and success. And our chances of winning are the same as any of the other 35,000 foals born a year. The commercial breeding market drives racing. Two of the best credentials for a U.S. based stallion are being a precocious 2-year old and a win in a Triple Crown race or even better, sweeping the Triple Crown. So we need to race our expensive racing/stallion prospect at two and obviously we aren't going to geld him unless he absolutely won't run as a colt. The highest income possible in racing is from the stallion fees of a leading sire. Stallions can earn far more from fees than purses. In order to make a stallion, it is best that he retire from racing as young as possible, cover as many mares as possible and get his foals to race as quickly as possible. The main reason for the emphasis on 2-year old racing is to prove stallion prospects and first and second year stallions. What many aren't aware of is that an inexpensive or non-commercial colt isn't very valuable as a stallion prospect no matter how much money he wins. The best stallion prospect is a colt who has earnings of over half a million dollars who has won a Triple Crown race or possibly a Breeders' Cup race AND comes from a great female family AND is by a sire considered to be a sire of sires. Even million dollar earners without the other credentials can cost more to promote than they earn in stud fees. If you want to promote stallions, FAMOUS is the operative word. If the above does not describe your racing prospects, you shouldn't count on your horses having a large residual value at stud. Emulating the actions of their connections is not necessary and is probably detrimental to your success in this business. Many racing prospects have shortened race careers due to being pushed too hard and too fast as a two year old. There are some 2yos that are ready to compete, but many are not. The reason many top ten trainers do not have Derby horses every year is that they let the horse decide it if is ready and not very many are. Flying Dutchman Thoroughbreds lives by this philosophy. As an investor your want to get the longest life and most earning potential out of your horse for starters. Secondly, the health and safety of the horse will always come first. If your goal is primarily racing and you're not playing the commercial game, you have greater freedom to manage your horse's career in a manner that will allow you the greatest potential for success. In order to make money, your horse needs to win more than one race. The best way to accomplish that is to let your horse tell you when it is mature enough to compete. Keeping horses sound and racing longer is better for the horse and the owner. More horses in training results in full fields which increases handle and therefore purses. Just as importantly, horses that race for many years create their own fan bases. Our great geldings like John Henry (this link will take you to the unofficial Thoroughbred Hall of Fame) and Kelso (this link will take you to the unofficial Thoroughbred Hall of Fame) brought out huge crowds, increased handle and generated much needed publicity for our Industry. There is little reason to keep your racing prospects colts. There are roughly as many colts as fillies foaled every year. There are over 400 stallions standing in Louisiana, and even more than that in Texas. Most are lucky to get ten mares a year and only a handful make money. If you're primarily interested in racing, geldings run more consistently, are less likely to be hurt and if they have a tendency to become heavier in the neck and forearm as they mature, can be sounder if they're gelded. Historically, many of our very best racehorses were geldings with very long careers. They can and sometimes do race until 12 or 13. Instead of injuring many started too young and retiring them at three or four, consider keeping them in training. Horses often become stronger and better as they age. If you can't find your Storm Cat, why not try for a Kelso (this link will take you to the unofficial Thoroughbred Hall of Fame) or John Henry (this link will take you to the unofficial Thoroughbred Hall of Fame)?

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