Between the initial acquisition price, day rates of trainers, vet and farrier bills, and other miscellaneous expenses that can occur, racehorse ownership becomes an expensive venture. Recently, there has been a rise in syndicates or partnerships in the racing industry that not only distribute the cost of ownership, but also allows more people to become involved in owning racehorses.
Syndicates can be formed by friends, family, and co-workers. A an individual can also choose to buy into a horse that is owned by a syndicate company. First-time owners should work with an established company that can guide them through the ownership process.
The inner workings for syndicates vary from company to company, but here are general guidelines:
- Your owner’s license application will be handled for you.
- You can expect regular updates on the progress of your horse, usually once per month.
- You will be billed quarterly for your expenses. These expenses can include a day fee, farrier bills, vet bills, transportation bills, and associated fees for the maintenance of your horse.
- If your horse is winning races or making enough to support himself, you will not receive a check. Instead, the money will go back into the horse. If the horse wins enough to pay his bills all year, you will receive payment at the end of the year.
Before signing on with any particular syndicate, you should research syndicates and the people involved in them before making any commitments.
Unlike sole ownership, the costs of the horse are distributed among all of the investors of that individual horse. If you own 5% of a horse, you are responsible for 5% of his bills; but you will also receive 5% of his earnings if he wins enough purse money.
Owners should purchase shares in multiple horses instead of a large share of just one horse. The hope is that the owner will see success in at least one of the horses he owns a share in.