Any advice for starting up a horse racing syndicate?

scoops22

I am in the process of starting up a new syndicate for National hunt.
The aim is for 10 people with an equal 10% share will buy a horse, and we will split up the training/racing expenses. I’ve been speaking to a few trainers already about it and have made a list that I would be happy to proceed with.

Have many people set these up before? Can anyone advise me on some of the important rules that need to be considered when forming the syndicate. Any pit falls that I could avoid? And what is the advice on buying a horse for modest money around the €25k mark.

Thanks

irish_major

scoops22 wrote: »

I am in the process of starting up a new syndicate for National hunt.
The aim is for 10 people with an equal 10% share will buy a horse, and we will split up the training/racing expenses. I’ve been speaking to a few trainers already about it and have made a list that I would be happy to proceed with.

Have many people set these up before? Can anyone advise me on some of the important rules that need to be considered when forming the syndicate. Any pit falls that I could avoid? And what is the advice on buying a horse for modest money around the €25k mark.

Thanks

Talk to the HRI about setting up the syndicate. They are very helpful.

Have you 10 people got? If buying for around the 25k mark I would advise that you'd need 4k a man to get you going. Would recommend the autumn horse in training sale in newmarket. Always bargains to be had and with the big benifit of buying a horse in training is you can see how it has ran before and make informed decisions based on the horses previous runs.

Buying a yearling or unraced horse is risky business. Much more likely to have fun out of a horse in training. Greatly reduces costs too

scoops22

irish_major wrote: »

Talk to the HRI about setting up the syndicate. They are very helpful.

Have you 10 people got? If buying for around the 25k mark I would advise that you'd need 4k a man to get you going. Would recommend the autumn horse in training sale in newmarket. Always bargains to be had and with the big benifit of buying a horse in training is you can see how it has ran before and make informed decisions based on the horses previous runs.

Buying a yearling or unraced horse is risky business. Much more likely to have fun out of a horse in training. Greatly reduces costs too

Thanks

I have 7 in so far. I was budgeting it for 2500 each for the horse and then 1650 yearly for the training fees, which I think should more then cover it from talking to a few trainers.

irish_major

scoops22 wrote: »

Thanks

I have 7 in so far. I was budgeting it for 2500 each for the horse and then 1650 yearly for the training fees, which I think should more then cover it from talking to a few trainers.

You'd be doing well for 16500 to do you for the year. Last months training bill for us was 1,800 as we had 2 trips to the races. Add in jockey and entry fees and you're up-to nearly 3k for one month!

scoops22

irish_major wrote: »

You'd be doing well for 16500 to do you for the year. Last months training bill for us was 1,800 as we had 2 trips to the races. Add in jockey and entry fees and you're up-to nearly 3k for one month!

Is that not offset by a summer break on grass at around €300/€400 a month?

famagusta

There was a good thread on this a couple of weeks ago. I'm looking after two separate syndicates at the moment, it's great to be involved.
We have jumps horses as I buy them as foals and we either sell or race them after.
A couple of friends have had good success with buying from the horse in training sale as said above, that might be the way to go for ye.
The costs are high but you should be recouping prize money too!!!

NaiveMelodies

famagusta wrote: »

There was a good thread on this a couple of weeks ago. I'm looking after two separate syndicates at the moment, it's great to be involved.
We have jumps horses as I buy them as foals and we either sell or race them after.
A couple of friends have had good success with buying from the horse in training sale as said above, that might be the way to go for ye.
The costs are high but you should be recouping prize money too!!!

In my opinion the first rule is exclude potential prize money when considering any costs/income! Prize money always has to be seen as a bonus. People have to be prepared for this when getting involved in a syndicate. The majority of horses do not recoup prize money!

famagusta

NaiveMelodies wrote:

In my opinion the first rule is exclude potential prize money when considering any costs/income! Prize money always has to be seen as a bonus. People have to be prepared for this when getting involved in a syndicate. The majority of horses do not recoup prize money!

That is fair enough, hopefully there will be a bit coming in after a while to keep the HRI account topped up.
OP, you need to Lodge 1000 euro to HRI account at the start too.

famagusta

When talking to potential trainers, make sure to ask about costs of travel etc as above. Some trainers rates are a lot different to others.

Thud

would suggest putting a vets/treatment fund aside too

BumperD

Set aside 20k pa. If your insuring the animal, add 10% pa. If you decide to go bare, that’s fine too.
Have everything set out in writing in an agreement, make each member read and sign it, with a fixed period and exit plan. As said earlier, ensure everyone knows that they will not see their money again and in the unlikely event you actually place, that cash will probably feed back into fees etc. that way you’ll set expectations low and avoid disappointment which inevitably go hand in hand with ownership. Maybe an odd membership number 9 or 11 is better for voting. Managing expectations is as import as anything good luck with it.

The Tetrarch

I think the points above about managing expectations are on the mark.

Research by Dr W Robert Cook (book The Airflow Factors)
1000 matings
720 live foals
540 into training
33 make ends meet
2 win prestige races

If 1 in 30 (33 of 1000) break even then the chance of making a real profit is about 100/1.
.......................................................................................................................

My advice is to get the money from the syndicate members in advance, both the horse purchase price and about six months training fees.
Then from month one collect the monthly training fees from each person.
If a syndicate member is slow in paying, and many will be, then take the unpaid fees from their six months training fees in advance, pay them their balance, and put them out of the syndicate.

What will happen is the horse will be useless. Most are.
Members will refuse to pay training fees. They were misled. You bought the wrong horse. The trainer is no good. People will be uncontactable.

carq

Agree with a lot of the above.
Exit plan is important too. what happens when 1 person decides to leave - can he buy himself out, does he get a dividend - etc - needs to be formalised.

Also important to manage communication in the syndicate so everyone feels involved, when the horse is running etc, how it is doing in training.
seems basic but if not done can build resentment from people not directly in contact with the trainer