Tiny shares and big dreams are Just Fine

Anyone that has travelled to the United States knows that Americans like to do things on a grand scale. From skyscrapers to hamburgers and everything in between, it is a cultural case of go big or go home.

Fitting then, that an innovative racehorse ownership concept with big dreams was born in the USA; ironic though that the dream is based on offering racing fans an opportunity so small that owning a hair on the tail is quite a literal premise.

Michael Behrens was a marketing executive with a well-established track record of success when he decided to apply a creative mindset to his passion for racing. He’d just grown direct-to-consumer mattress brand Casper from a start-up to a $600 million business in just four years, because people need somewhere to sleep – not everyone needs a racehorse.

With investment assistance from the late Wayne Hughes of Spendthrift, Behrens backed an engagement product, inviting people to experience all the excitement and benefit of owning a horse, with a couple of thousand other people.

He struck it big in 2020 when MyRacehorse runner Authentic hit the big time and won the Kentucky Derby sending his 4000 owners into rapture. The son of Into Mischief doubled up and landed the Breeders Cup Classic later that year.

“Authentic got serious headline space and put the concept on the map. That success gave Michael the confidence to expand to other countries, and because Spendthrift had an association with Australia at the time, we were next on the list,” said Ben Willis, Managing Director of MyRacehorse Australia.

At Flemington in late May, MyRacehorse celebrated victory with Sneaky Sunrise, the Lindsay Park-trained two-year-old, joining Gai Waterhouse and Adrian Bott’s Group 1 winner Just Fine and Ciaron Maher’s talented Glory Daze as local success stories. 

Although the micro-share ownership model is a new concept in Australia, the global unofficial home of thoroughbred syndication, it is gaining popularity with every yearling sale and is playing a critical role in building new engagement with the sport.

The model is more like taking out a membership of a football club rather than the traditional ownership arrangement that comes with owning 5% or 10% share of a horse.

Micro-share owners pay a once-off purchase fee for a share that often covers all costs of the ownership experience, the difference being the experience is shared with 1000 owners rather than 10 or 20.

“Think of it as an entertainment product. You pay your $100 and get three or four years of entertainment, cheering on your horse and being a part of its team. This is a gateway for engagement and growth of the sport. We are democratising horse ownership,” said Willis.

Micro-share owners share in any prizemoney earned by their horses relevant to their share size, but even in the most successful cases the returns are humble.

For context, the 2023 Kentucky Derby winner Mage was partially owned through micro-shares offered by the Commonwealth investment group. Each micro-share of Mage yielded approximately $95 from the $1.86 million first prize, but for the 400 micro-shareholders present, the victory carried a value far beyond the monetary prize.

“I'm a Geelong member and I went and watched the Cats beat Sydney in the 2022 grand final. As a member and a supporter of the club it was an incredible day, unforgettable, but I didn’t get a payout from the prizemoney or anything. I woke up the next day and life went on, but I had the experience forever – that is what micro-shareholding offers,” Willis explained.

The popularity of micro-share ownership is growing at a rapid rate, and not just in the United States. MyRacehorse’s Australian division boasts a client list of 45,000 that is growing by around 50% each year according to Willis.

Home-grown micro-share agency MiRunners has also experienced consistent growth. It offers owners the chance to follow their horses into the breeding barn, as well as bespoke breeding opportunities for those who wish to experience the journey of breeding their own horse through broodmare shares.

Blockchain micro-share provider BTX Racing raised $5 million in seed capital in 2023 before launching its innovative product to crypto-minded millennials keen to explore investment and trade of horse shares. BTX Racing has made significant investment in breeding stock, with broodmares covered by the likes of Maurice, Russian Revolution and Stay Inside, boasting racing partnerships with Ciaron Maher, Gai Waterhouse and Adrian Bott and Griffiths De Kock Racing.

While MyRacehorse continues to grow its brand in the USA thanks to the deeds of recent Preakness Stakes winner Seize The Grey, with expansion underway in the traditional Thoroughbred heartland of England and Ireland, new players are emerging. Commonwealth not only offers racehorse micro-share ownership but also athlete investment; members can invest in the careers of two young professional golfers and share their journey with them.

“The beauty of micro-ownership is that it is giving racing fans the chance to be involved at a greater level than the run-of-the-mill punter, but at a price point that they can afford,” said leading racing presenter and MyRacehorse ambassador Jason Richardson.

Richardson admits he was somewhat sceptical as to whether the micro-share ownership would take off in Australia, given the popularity of the long-established syndication model and the brand position and success of leading syndication businesses. However, those queries were quickly quashed as he explored the concept in detail.

“This is all about engagement, it’s about making the sport as accessible as we can to as many people as we can,” he said.

“I hosted a function on the Gold Coast last year for My Racehorse which had Infatuation competing in a race on Magic Millions day. 200 owners turned up and the excitement and passion in the room was amazing.

“They are tapping into a market of people who could never in a million years afford to buy a bigger share in a horse via traditional pathways, it’s broadening the reach of the racing and that can only be a good thing.”

Thinking ahead

MyRacehorse is also dedicated to supporting horses after their racing careers. With every micro-share purchase, a portion is allocated to the Horse Super Fund (HSF), bolstered by a matching contribution from MyRacehorse. These funds facilitate a smooth transition for horses into post-racing life. The initiative is headed up by MyRacehorse’s Equine Welfare Consultant, Jen Krawczyk. With expertise in equine science and welfare, Krawczyk played a pivotal role in developing Racing Victoria’s Equine Welfare Strategic Plan and expanding their Off The Track Program. Recognised as the 2023 Victorian Wakeful Club Lady of Racing and a committee member of IFAR, Krawczyk ensures that horses receive comprehensive support as they move beyond racing.