How Many “Bad Apples” Are There in the Bloodstock Orchard, and Will They Now be Eradicated?

Back in the autumn of 2017, I wrote several blogs about integrity and corruption in racing, which included the bloodstock supply chain and sales houses. As a result of this I was invited to take part in the investigation instigated by the BHA and led by former senior policeman Justin Felice. I met up with him and colleagues on a couple of occasions and shared with them my own experiences encountered in buying racehorses over a 15-year period. Early in August, key stakeholders in racing met for a first review of his report, which was subsequently leaked by the Racing Post. Encouragingly, many of the recommendations I made to the study have been incorporated in the report, though I must emphasise that I haven’t yet read it myself, so this blog is based on the leaks. Further stakeholder discussions are taking place through September, and as soon as I’m able to obtain a copy of the full report I’ll do another blog on the subject.

Full credit should be given to the BHA for being prepared to launch this study. They came in for a fair bit of criticism and it is true to say that there are a few vested interests who were reluctant to acknowledge that major changes are needed. Some agents, trainers, managers of studs, bloodstock vendors and syndicators are guilty of “improper practices” which, if you are generous, you would say are unscrupulous and dishonest but if not you would say are criminal breaches of their fiduciary duties towards the purchasers of bloodstock, namely owners.

Felice is damning in his analysis of the industry and, quite rightly, calls for “transformational changes”. Although there is a code of practice dating back to 2004, subsequently amended in 2009, there hasn’t been a single recorded complaint in 15 years, which only encourages a number of resisters of change to remain in a state of denial over the corruption that occurs on a significant scale. Felice acknowledges this and believes that there is omerta – a culture of silence and of impunity. Bad, and even illegal, behaviour has long been tolerated by the industry. This isn’t some sort of minor, grubby, “Del Boy”-type misdemeanour; it is endemic behaviour up to and including the elite of breeders and agents who have shamelessly ramped prices and ripped off naïve and gullible owners. Addressing this behaviour is long overdue, and the real test of successful implementation of the Felice report will be the sharpness of the teeth of enforcement practices, the number of complaints that now surface and, in time, the banning and / or criminal prosecution of some of the culprits.

Many of the “improper practices” are widely known, and include:

• Agents demanding a percentage of the sale price as totally unwarranted “luck money” from vendors. They pocket this for themselves and / or share it with the trainer. The owner knows nothing about it.
• Dual representation, where the agent is acting for both purchaser and vendor, and charges a commission to both parties. Although representing both sides of the same transaction, at least one of the parties is unaware of the fact.
• Secret profiteering, which is when the sales process is rigged through conspiratorial pre-agreed bidding up of a horse’s price. Vendors and agents conspire to inflate the price artificially above a pre-agreed amount and then split the difference between themselves.
• Running up a price where the vendor bids against a buyer, without their knowledge, to obtain a higher value for their horse.

Anyone who is acting as an “agent” for a principal, e.g. an owner, must act in the principal’s best interests, otherwise they will be in breach of agency law and legislation such as the Criminal Law Act 1977, Fraud Act 2006 and Bribery Act 2010. In the light of the extensive use of the four “improper practices” described above, it is staggering that there haven’t been any prosecutions, but Felice is well aware that collusion and coercion in the bloodstock supply chain means that there is a huge reluctance to act and, indeed, a fear that by coming forward, individuals will be victimised by the powerful players who dominate at the sales. It is encouraging, therefore, that “transformational and once in a generation” changes are being proposed, inter alia:

1. The BHA to be given jurisdiction over the currently unregulated bloodstock sector.
2. The industry to operate under a proper, tougher Code of Conduct.
3. Agents to be licensed. Those operating under such a licence will have to accept regulatory access to bank accounts if an investigation is taking place.
4. Breach of the licence will lead to an agent losing it, together with bans and removal of access to the sales.
5. Furthermore, breaches of the Rules of Racing – conduct prejudicial to horseracing – to be enforced on similar lines to the Financial Conduct Authority.
6. Payment of luck money over, say, £250 to be deemed to be an inducement, and therefore criminal.
7. Stop vendors bidding on their own horses beyond the reserves that they themselves have set. When a vendor bids beyond that reserve, the auctioneer to be required to announce it as a vendor bid.
8. Binding agreements introduced between the BHA and sales houses to enable information sharing.
9. Make it clear who is selling the horse. Sales houses to log and make public the full beneficial ownership of every horse due to be sold.
10. Harmonisation of these changes to occur in Ireland and, in time, other jurisdictions such as France.

It will be interesting to see the progress made once consultation with stakeholders has been completed, and whether the industry is prepared to put its bloodstock sales houses properly in order. Zero tolerance of corrupt practices is required. Without it, the already fragile ownership base is likely to contract further and profound damage be done to racing’s integrity and reputation. At least it is encouraging that the study was completed and that there is a readiness on the part of the BHA to publish it and act on it.

I am always interested to hear your views so please do leave a comment. If you can't see the comment box at the bottom of this post then navigate to the post using the right hand navigation or click here > and scroll to the bottom of the page. Look forward to hearing your views. Thanks very much for sharing them.

Trust, Transparency and Integrity in Racing – The Concluding Part 4 of the Series.

It’s been interesting as I’ve written the blog series around the subject of trust, transparency, integrity and corruption that not a single owner I’ve talked to about it has disagreed with anything I’ve raised. As in everything to do with life and commerce, perception really matters and unfortunately the overriding perception is that the breeding supply chain that brings horses through to owners is inherently stacked against the owner. On occasions it is almost certainly corrupt, and almost daily there are practices being perpetrated that while probably not illegal, lack the necessary standards of integrity.

It is clearly very difficult to gauge the overall impact of this on racing and ownership, but I definitely believe that the BHA is taking the right stance by putting a much greater focus on integrity in all aspects of our sport and is prepared to examine breaches of the necessary standards in the context of the whole sales process.

There must be an irony that I’m writing this blog having just bought a foal today at Goffs in Ireland, and when this blog goes live I’ll be attending the Tattersalls Cheltenham sale with some friends who are prepared to invest deeply. Unfortunately I can’t help but feel that owners are receiving inadequate value for money on too many occasions and cumulatively that must be acting as a potential barrier to new owners coming into the sport while discouraging retention of the owners who are already active supporters.

So I thought it timely to reflect on my “top ten” recommendations for addressing these problems. They are not in any priority order but I do believe that if the BHA puts a searchlight on them, it will definitely be to the greater benefit of the whole ownership community.

1. Develop an end to end integrity framework. What I mean by this is to map out every stage in the equine supply chain from breeding through to the eventual retirement of the racehorse. At every step in the chain there is potential for corruption, and this should be mapped out so that the level of risk is made explicit.
2. Set integrity standards. Having mapped out the supply chain, it is then possible to state unambiguously what the necessary personal, professional and commercial standards should be, and what is acceptable or unacceptable behaviour.
3. Monitor and police those standards. Having developed an integrity framework and set the appropriate standards, the BHA then needs to have inspectors who can then monitor and identify the perpetrators of unacceptable practice. The whole industry through the various stakeholder groups to have been warned in advance of what is unacceptable behaviour and for this to be built into the rules of racing.
4. Identify and copy best practice. Other countries, particularly Germany, are determined that the breed is strengthened on an ongoing basis by not allowing substandard mares to produce foals. The performance record of stallions should be tracked and minimum standards set for mares. The recent requirement for horses with first-time wind ops to be reported is a step in the right direction because over time it should be possible which stallions are passing on higher than average wind problems.
5. Give every horse a log book from day one. In the last blog I commented that you wouldn’t buy a £100,000 car without a log book, and I don’t see why you should do the same with horses. The racing authorities in England and Ireland as a minimum should make it a requirement that any veterinary treatment to any racehorse is logged, and that when the horse goes into any sale, a PDF of that document can be accessed online for one month before the sale date.
6. Improve pre-sale veterinary inspections and change the charging policy. All horses being sold at public auctions should be inspected properly and thoroughly once, with the cost of that being paid by the vendor. A full inspection report should be available. Furthermore the vet making that inspection should be held liable for the quality of it. If the report is inaccurate, the vet should be held to account both commercially and professionally.
7. Full declaration of anything performance-enhancing. I know that many trainers argue that owners and the racing public don’t understand the pros and cons and limitations of many veterinary treatments and procedures, but I do believe that they should be declared. It is why I’m in favour of transparency on wind operations, but I would extend that to all major interventions.
8. No limits to transparency. The simple guiding principle should be that if access to a piece of information can provide a trainer, owner or punter with a commercial advantage, then that information should be in the public domain wherever possible. So for example should there be a requirement to disclose when a horse’s tendons have been fired?
9. Fund more evidence-based research. Owners are losing money every day buying horses which are genetically predisposed to certain maladies and conditions that will significantly constrain their performance during their life as racehorses. The BHA should fund research to collect evidence over time that will identify more of these conditions. As they will be recorded in the horse’s log book, then an informed owner can make an appropriate decision not to invest.
10. Have all the information readily available. In the age of social media, all information should be at owners’ and prospective buyers’ fingertips. There may well be an accusation of information overload, but it would be better for the information to be there if an owner wants to access it, than to be left in the unacceptable position of buying horses where there is significantly asymmetrical information, i.e. where the prospective purchaser knows far less than other interested parties upstream in the supply chain.

I’ve now been involved in buying and owning about 100 horses, either on my own or with co-owners. Unfortunately I believe that if I’d had full information I wouldn’t have bought at least 20% of them. Assuming an average total cost of £50,000, that’s £1m of money in effect wasted. This issue is that serious. I hope that in ten years’ time I won’t have to write another series raising the same ten recommendations. I fear that the first horse of the sale today ought to be called “Pigs May Fly” (Apologies to Lot 1, Ilsnepasserontpas, who I hope turns out to be a magnificent horse giving superb pleasure to whoever buys him.)

I am always interested to hear your views so please do leave a comment. If you can't see the comment box at the bottom of this post then navigate to the post using the right hand navigation or click here > and scroll to the bottom of the page. Look forward to hearing your views. Thanks very much for sharing them.

The Row Over Horse Race Sponsorship and Why Bookmaker Behaviour Has to Change

Last Saturday was the 58th year of the oldest sponsorship in British racing in the Hennessy Gold Cup at Newbury. With the row that has now erupted over Authorised Betting Partner (ABP) status and the brinkmanship between some of the big bookmakers and British Racing, one wonders whether we will see such successful and rewarding partnerships again, or whether a permanent chasm has opened up between the parties. Encouragingly there appears to be very little sympathy for the bookmaker stance as they try to evade making a fair and sustainable contribution to the sport. Indeed, for the moment, racing and the betting public appear to be disgusted by their short-sighted and extremely selfish stance. Surely this must in turn cause substantial brand damage – not least at a time when the financial performance of some of the big bookmakers is lamentable and they are increasingly huddling together through mergers or, as some commentators have said, “propping each other up like down-and-out drunks”.

ABP status is one tool to encourage bookmakers to make a proper contribution to racing from their offshore betting turnover. The BHA estimates that our sport is losing £30m a year because of levy evasion. Some bookmakers such as Bet 365, 32 Red and Betfair are already making a voluntary contribution (and you could argue, putting themselves at a competitive disadvantage to those that are not), whereas others such as Betfred, Ladbrokes, Coral, William Hill, Skybet, 888 Sport and Paddy Power are making no or minor contributions. From 1st January 2016 bookmakers will not be able to sponsor races without being ABP accredited.

It only took a few weeks from the announcement of ABP for brinkmanship to break out, with die-hard bookies threatening to pull the plug on their sponsorship deals: Betfred with the Cheltenham Gold Cup and Haydock Sprint Cup; Ladbrokes with the World Hurdle; Coral with the all-weather championships; and William Hill with the Kempton winter festival including the King George VI. Paddy Power have indicated that it could well affect their Cheltenham sponsorship. Some have questioned the legality of ABP exclusion as a potential breach of competition law. Alas, all very predictable, as was Betfair stepping in to the sponsorship role for the Tingle Creek at Sandown as soon as 888 Sport dropped out. This row is certainly going to test the unity of the various parties.

Obviously the row is not without risk. Although the figures are a few years out of date, when Deloittes and the BHA produced their Economic Impact of British Racing in 2012, total sponsorship was £82.2m, with 7,326 races sponsored. Of this, bookmakers’ contribution was £31.8m, covering 3,018 races, or 41% of the races and 39% of the total sponsorship pot. Similarly from the BHA Fact Book 2011-12, the breakdown of prize-money in 2011 was Levy Board contribution 34%, racecourses 28%, sponsorship 20% and owners 16%. So if the bookies decide to go elsewhere with their sponsorship money and fund other sports, it will clearly damage the funding of racing and owner prize-money, at least in the short term.

Is this a risk worth taking? The over-arching principle now guiding British racing is that there must be a sustainable, commercial funding regime for the sport. Bookmaker contribution through the levy (or its replacement) is critical. As many levers of persuasion as possible need to be used to encourage, cajole or coerce bookies back to the negotiating table. The levy talks have broken down, so the ABP route is one lever that is definitely worth continuing with, particularly if the bookmakers receive a proper package of benefits as a result of signing up. Unfortunately at the moment hostility between the parties is blocking off a more collaborative search for the many mutual benefits that certainly exist. Without bookmaker behaviour changing, this could still have the makings of a zero sum game. It is vital that the debate shifts as quickly as possible on to innovation and growing a bigger betting pie while making racing even more attractive to the sports-going public. This can only happen through commercial collaboration.

One benefit that may come out of the row is a complete re-think of racing sponsorship. From the bookmakers’ side a lot of it looks extremely pedestrian and little more than a naming and badging exercise for races. From the racing side the product proposition is generally tedious from Sunday through to Friday, with insufficient thought and co-ordinated planning being given to framing fixtures and races that genuinely excite the consumer and, in turn, maximise betting revenue. Admittedly there are the high points of Cheltenham, Aintree, Epsom, Ascot and Goodwood but thousands of races are instantly forgettable as, indeed, are their sponsors.

And finally, a strong case can be made for looking way beyond traditional race sponsorship by bookies. Racing has become inertial, with chronic under-representation of leading British and global companies in our sport. From the 2012 data, food and drink companies only put in £6.5m of sponsorship, while the financial services sector was even less visible with £4.3m. A massive mind-set change is needed from sponsoring races to sponsoring events and experiences. Marketing gurus argue for “the integration of sponsorship platforms”, “co-creation of brands between companies and consumers” and “customers acting as ambassadors”. Watching Neanderthal bookies locking horns with Great British Racing in ultimately self-defeating rows over financial contribution, it is easy to despair. However it would be of real benefit to the industry if a search for new sponsorship in turn brought in a new generation of companies and dynamic leaders from other sectors with an enthusiasm to transform the whole way in which racing is presented to the broader betting and racegoing public.

In the meantime, I enjoyed raising a glass of fine brandy to the Hennessy winner.

I am always interested to hear your views so please do leave a comment. If you can't see the comment box at the bottom of this post then navigate to the post using the right hand navigation or click here > and scroll to the bottom of the page. Look forward to hearing your views. Thanks very much for sharing them.

Welcoming the Director of Common Sense, and Future Gilded’s Novice Chasing Case

Over the last few weeks there have been quite a few announcements of some excellent appointments at the very top of racing. The old adage is that ships either float or sink from the bridge, and Steve Harman, BHA Chairman, is to be congratulated for showing a steely resolve to make sure that racing has a much broader leadership cadre, combining not just in-depth racing expertise but stronger business and commercial acumen. This is all part of putting in place a growth strategy for racing that is essential if the sport is to compete properly with all the other leisure sectors and racing territories. Indeed it says a lot about racing in the past that this will be the first ever proper strategy. Really looking forward to seeing the detail as it emerges in 2015.

However, Owners for Owners is probably the only organisation that is aware that a top-secret appointment has been made, yet to be announced – racing’s first ever Director of Common Sense. Any business sector or organisation can easily become process-bound and overly constrained by the letter of the law on its rules and regulations. We have seen a number of instances over the autumn where relatively minor episodes have an very negative impact on the public perception of the sport. If the day’s top jumps meeting suddenly finds that its best race is in jeopardy because of sunlight, it only makes sense to move it on the day so that it is run as a proper spectacle rather than a strange mish-mash of jumping and flat racing as numerous fences are bypassed by sticking to the same race time. If there is a minor infringement due to a flag man inadvertently waving the wrong flag (obviously fully acknowledging the need for jockeys to be vigilant and never to ignore the potential dangers of disobeying flag instructions), then let the race result stand and don’t overly punish the jockeys through lengthy bans. Racing wants to see its superstar jockeys over the Christmas holiday period, and banning someone such as Richard Johnson for the duration takes away a lot of public interest. Indeed, I think banning is a dubious punishment anyway. Hitting jockeys’ pockets really hard would probably be far more persuasive, and could be flexed to suit the circumstances of the rider.

So a warm welcome to the new appointee, and I can tell you now that the diary is likely to be very full. Indeed, with having this inside information, we have already lined up an important test case of Future Gilded (known as “Frankie” by his friends) vs. The Handicapper. Trainers and owners are finding the new novice / novice handicap chase regulations quite difficult to come to terms with, and I suspect it is likely that they will be tweaked again before too long. It is possible now for a horse to go into a novice handicap chase and run off his current officially-rated hurdle mark. This is a good innovation, because otherwise he would have to race against potential superstars from the Nicholls and Henderson yards in novice chases. Come up against a 150+ horse, run a fine race to come 2nd, 3rd or 4th and your handicap mark is probably blown for ever.

Eighteen months ago, Owners for Owners bought the gorgeous Frankie at our favourite sales venue, Arqana in Deauville. He had won his only race, over hurdles at Aix-les-Bains, and we knew that he wouldn’t be eligible as a result for novice hurdles in his first season with us. He would have gone into handicap hurdles, but for sustaining a slight tendon injury that meant he was on the sidelines until now. He’s a gorgeous, big, strong horse, made for chasing, which is where we’re going with him. We entered him in a handicap hurdle to get a mark, and have now got one – 117. Unfortunately though, when we then considered entering him for a novice handicap chase, we were told he is not eligible “due to the rules”, and that he would have to go handicap hurdling for three races first. Because he must have soft ground, and jumps fences far better than hurdles, this is the last thing we want him to do. He spent the whole autumn building his strength steadily and having regular scans to ensure the tendon has been sound, so it has taken until mid-December to have him ready to make his debut for us. If we go down the hurdling route, the risk will be that we lose the ground before all three races can be run, and then another season has gone. So the only option available to us is to go novice chasing ….. with the attendant risk of coming up against a potential super-star. Our trainer has spoken to the handicapper, who admittedly is sympathetic, but can’t do anything to help us. So we are running today at Plumpton in the 12:40. Do watch it and cheer on Fabulous Frankie. And if I see the new Director of Common Sense, I’ll be arguing my case with him in the O&T bar.

I am always interested to hear your views so please do leave a comment. If you can't see the comment box at the bottom of this post then navigate to the post using the right hand navigation or click here > and scroll to the bottom of the page. Look forward to hearing your views. Thanks very much for sharing them.

No More Nonsense at Newbury (or at least for the time being), Part 3 – Understanding the Challenges facing the Racecourse and Putting the Dress Code Fiasco into Context

A large group of us went to Newbury Racecourse on 28th December to cheer on Shantou Magic in the Grade 1 Challow Hurdle. He came 4th, after a very bold and brave attempt to make all. It was a real privilege to be in the winners’ enclosure after a race of this importance – the dream over his long-term future is well and truly alive. He may well race again at the end of the month in a valuable handicap before stepping him back up in grade again. A really exciting day – and fortunately, no silly dress codes to deal with. My wife, Jack, bravely wore exactly the same outfit as on Hennessy day, without incurring the wrath of poorly trained stewards.

During the day I was most impressed that the newly appointed CEO, Julian Thick (former MD of Aintree, Sandown and Kempton Park) went out of his way to track me down and was most generous with his time. We had a long discussion about the dress code, and also the broader strategic development of Newbury. He couldn’t apologise enough for the poor implementation of the dress code, and as compensation is going to provide lunch in the Royal Box on Betfair Gold Cup day, Saturday, 8th February, which is something to look forward to.

In the short term, the dress code has been suspended while Newbury considers what to do next. Defusing this issue and mitigating the PR damage of it was clearly the only sensible option. So what should Newbury do next in terms of customer behaviour and “standards”? Indeed, do you think it should do anything?

I thought an interesting starting point would be to look at the finances of the racecourse. The track is part of Newbury Racecourses plc, a group of companies that own the racecourse and engage in “racing, hospitality and catering retail activities”. Very significantly, in 2012, they entered into a joint venture development agreement with David Wilson Homes for a major redevelopment of the racecourse, together with the construction of 1,500 homes. While there is apparently strong demand for these apartments and houses which are being built along the racecourse, there is much lower demand for actually attending races. In 2012 the track lost £1.2m, although profitability has improved since, with increased media revenues and the securing of longer-term sponsorship deals with the likes of Moet Hennessy, Dubai Duty Free and Bet365. Just like most companies with rising costs and falling revenues, they have completed businesswide reviews to stem the losses and increase the turnover.

Cynics (and there is no shortage of them in our sport) argue that Newbury is now just a real estate asset that happens to have a racecourse at the centre of it. At some stage, do you abandon racing altogether, or let it decline while looking for easy revenue through rock concerts, parties, exhibitions, conferences etc.? Encouragingly (and I’m definitely not in the cynical camp), all the strategic statements within Newbury’s accounts indicate a very robust commitment to quality racing and the Board is chock full of leading owners and racing enthusiasts with considerable business experience. Also they have signed up for the premier tier prize-money agreement with the Horsemen’s Group, which was absolutely the right thing to do.

It seems to me that Newbury is trying to grapple with the broader challenges that face our sport. Attendance is declining, as is individual customer spend. The last thing it wants on the track is drunken, loutish behaviour that will frighten away customers. However the dress code fiasco wasn’t the way to change behaviour. The problem though still exists. With all the rebranding that “The Racecourse, Newbury” is trying to pursue (and whether you believe this is contrived or not is another debate), it only seems sensible that influencing customer behaviour in such a way as to increase and sustain attendance is central to the overall business and financial strategy necessary to ensure that Newbury survives as a top-quality racecourse.

So what should Newbury (and for that matter, other racecourses) do next? All views welcome. I promised to put forward some views in this blog, but after the discussion with Julian Thick I felt it important to put the whole debate into a broader context first.

Owners - #1 Stakeholders, #1 Economic Contributors …. But Well Last in the Economics of the Sport

I love this time of the year. Two year olds are coming out on to the track and showing us what they can do for next year; all the NH owners’ days are under way with the dreams of future Cheltenham and Aintree glories well and truly alive; and the champions’ days in Ireland, at Ascot, Longchamps and the Breeder’s Cup are still ahead of us. Lots to look forward to, and it is magnificent being an owner. Alas, the moose on the table (as one of my clients always used to say) is the lamentable return to most owners for their investment. In the last blog I was thinking of calling this one “Milking the 8,215 cash cows (owners) dry”. However, I’ve decided to stay with the facts as summarised in the Deloittes study, Economic Impact of British Racing 2013. But here is the key paragraph in the report for us:

“Owners are the single biggest contributors to the funding of British racing, both through their purchase of horses from breeders (£189m being breeders’ expenditure and commission paid on horse purchases) and ongoing training and racing expenditure paid to trainers, jockeys and supporting industries (£369m). After receipts of prize money and sponsorship of £85m, owners are estimated to have made a net injection of over £470m in 2012 (compared to £465m in 2008).”

So let’s dig into these figures as well as others in the report and highlight the key statistics and implications (bearing in mind that the key figures relate to 2012).

• As owners, we’re putting the thick end of half a billion pounds a year into the sport. No-one else puts anywhere near that amount of money into the game. We are the #1 economic contributor, by a considerable margin. 
• Prize money over the past decade has remained within a relatively narrow band between £94m and £110m. In 2012, it was down at £78m (although encouragingly it is rising through 2013). For every £100 an owner spent on training and racing their horse, they recovered on average £21. 
• Cumulative inflation over the same decade has been 34%, so as an absolute minimum prize money should have gone up over that period by at least a third. 
• Average costs per day for each horse in training rose from £54 to £62 over the four-year period to 2012.
• Gross cost per run was £4,000 (reduced by 20% when prize money is taken into account). This is far more than virtually every other racing nation because of the low prize money in the UK. 
• The expanding fixture list (particularly with the dross of A/W racing) has resulted in average prize money per race declining by 14% since 2003 (but of course has led to a rise in betting turnover). 
• There were 24,000 horses in training during 2012. 17,500 appeared on the track. So over a quarter of all horses didn’t appear, and obviously made no contribution whatsoever for their owners. Of those that did appear, 6,500 won at least one race, so – big intake of breath – only a quarter of horses end up winning anything. 
• Between 2008 and 2012, there was an 11% fall in the number of horses in training, and a 14% fall in the number of owners. 
• 60% of all owners are involved in joint ownership in order to share the costs. 
• The final statistic (from the ROA) is that the upper end of the ownership scale has been the most resilient. Owners with three or more horses are down 7%, whereas those with an interest in only one horse are down 16%.

Phew! At this point it’s probably best either to lie down with a large block of ice on your head, or alternatively bang said head against a brick wall. These figures just do not make any sense whatsoever. Having said that, I have no intention of decreasing my involvement, despite the economic lunacy of being an owner.

Graham Lee came out with a very interesting comment about his switch from NH to the Flat: “The jumps is about fun, but the Flat is about business.” I was talking to one of our owners and he both agreed with the statement while also thinking that it was ludicrous. Owners are being exploited because there is a view that they will carry on supporting the industry regardless because of their love for the game.

Well, my challenge to everyone in racing is let’s start looking at the whole game as a business first, and dramatically improve the total economics of the sport. That means that as owners, if we are the #1 contributor, there must be a fundamental shift in the returns. We are the #1 stakeholder, and if the economics don’t change, the whole sport is on extremely rocky foundations.

The Punter’s Glossary

Hi everyone. Jack and I are still basking in the warmth of a recent holiday in the Murcian desert of Spain. We were celebrating my stepping down from chairmanship of the consulting company that I set up a fair time ago. Our intention was to start off in the way we intend to carry on. We went on holiday at the end of the final week.

Earlier in my career I was persuaded to write a business textbook (Transform Your Supply Chain – Releasing Value in Business. Heavily discounted and signed copies are still available – not surprisingly!), and I still remember the shock of finding a copy of the magnum opus being flogged for £1 in a second-hand bookshop. One of my few claims to business fame is that for a (very short) while, the book was one of the top sellers in Brussels, of all places. My colleagues always used to say, “Well done Jon, big in Belgium”.

Anyway, that is a bit of a rambling introduction to the fact that as part of my holiday reading, I discovered a copy of Hitting the Turf – A Punting Life, written by David Ashforth. And yes, that was also £1. Inside the book there was a punter’s glossary that I found pretty amusing. I’ll have a go at doing the owners’ glossary for the next blog. Here are a few extracts.

Accumulator: bet requiring punter to make additional selections, until one loses.

Ante-post: special arrangement under which you are allowed to lose your money six months before the race has started.

Blinker: the first act of desperation (see also Hood, Visor, Gelding, Put Down).

Bookmaker: wealthy victim of repeated misfortune.

Double: bet based on the erroneous conviction that it is possible to pick more than one winner in the same afternoon.

Each Way: opportunity to lose twice in one bet.

Form Book: historical work, useful for predicting what will happen in the past.

Good Thing: losing horse.

Horse: magnificent creature with no sense of justice.

Inspection: examination of course to see whether it is fit for you to lose your money on.

Jockey: small person employed by trainer to ruin your win double.

Punter: person with no money.

Racecourse: place for seeing, at first hand, where things go wrong.

Starter: official who drops a flag to indicate that hope has ended and experience is about to begin.

Winning Post: wooden stick inserted in the ground in the wrong place.

On that note, wherever you may be over the summer, if it’s on a racecourse you’ll doubtless agree with the above. If not, I hope you’re enjoying your holidays.

Reflections on a Right Royal Ascot

Right from the off, this year’s Royal Ascot was a highly charged and emotional event. No sooner had there been a poignant minute’s silence in memory of Sir Henry Cecil than the meeting kicked off with the appropriately named Declaration Of War scooting home in the Queen Anne for the Magnier clan and their Florida-based new partner Joseph Allen, who owns the sire, War Front. (By the way, that splendid mare Zenyatta is now in foal to him.) This collaboration is all part of the battle for supremacy in the global bloodstock market, and was richly rewarded again when War Command slammed his field in the Coventry to become 5/1 favourite for next year’s 2000 Guineas. There must have been added pleasure for Sheikh Mohammed therefore when his Dawn Approach bounced back from the disaster of the Derby to win the St. James’s Palace Stakes. I doubt if Jim Bolger is flavour of the month at the moment with the Coolmore mafia, since he has allowed the Sheikh access by the back door to their magnificent Galileo bloodline. The mix of owners in the St. James’s Palace though hammers home why Flat racing is such a challenge for the average owner who can rarely aspire to the top rank: nine runners, with the owners being Godolphin, Khalid Abdullah, Mrs. John Magnier (with Michael Tabor and Derrick Smith) (x 3 horses), Ahmad Abdullah Al Shaikh, Mrs. Bolger and Sheikh Joaan Bin Hamad Al Thani (x 2). Having said that, later in the meeting it was a delight to listen to the co-owners of Clive Cox’s Lethal Force after they had won the Diamond Jubilee Stakes with a horse that only cost them €8,500 (which is about the same amount that we paid for our Aran Sky at the same sale in Ireland a couple of years later. No pressure on Karl & Elaine Burke, then!)

But without any doubt this year’s Ascot was a bad time to be a republican. Estimate’s hugely popular win for the Queen in the Gold Cup on Ladies’ Day will long be remembered as the highlight of the meeting. Obviously royal involvement has been a striking feature since the whole spectacle started in 1711, but the Queen’s enthusiasm for racing has rarely been so well rewarded, as she became the first monarch ever to have a Gold Cup winner, and it was her first Group 1 win in Britain since Dunfermline won the St. Leger in 1977. I well remember that race since it was the first Classic that I ever went to, and unfortunately for me lost a packet on Alleged, the horse Dunfermline beat. Alas he didn’t stay, although he was a terrific horse who won the Arc twice for Vincent O’Brien (and as an aside produced Shantou, the sire of our Shantou Magic).

It probably shouldn’t have come as a surprise that Estimate possesses the stamina needed to win this marathon Flat race. Her half-brother Enzeli also won it, and her sire Monsun throws many staying types. I’d love to have one of them in the Owners for Owners National Hunt portfolio, and will definitely be keeping an eye out for Shirocco stores. Wasn’t it great though for racing to be on the front pages for all the right reasons. I suspect it is only a matter of time now before John Warren, the Queen’s racing adviser and buyer of the Highclere horses, is elevated to the peerage. It was unbelievable to see the Queen so excited throughout the final couple of furlongs of the race – just like any other owner, in fact. Mind you, John looked as though he was about to get really carried away and embrace her at one point. It could have been a fine line between a peerage or the Tower.

I know we have the self-styled Champions’ Day at Ascot in the Autumn, but surely the only genuine Flat champions’ meeting in the UK is this one. Increasingly, international racing at the highest level is a real asset of the sport, with huge potential to raise racing’s profile and bring in much-needed revenue. Wouldn’t it be better if the racing authorities worldwide agreed on a proper World Series that tied together, in a sensible and coherent way, the top races in the UK, Ireland, France, Dubai, Hong Kong, Japan, Australia and the USA? At the moment, for example, if you run a horse at Champions’ Day you are really ruling out your chances of competing at the Breeders’ Cup. That can’t make much sense.

Finally though it is only appropriate to say a few words about the other immensely popular winner of the week. Anyone who watched the post-race interview with Lady Cecil after Riposte’s victory in the Ribblesdale couldn’t help but be struck by her grace and poise as she struggled to describe what the win meant. It definitely felt as though it was the 76th Royal Ascot win for Sir Henry. How sad then that the Cecils’ horse Thomas Chippendale, having won the Hardwick, collapsed and died.

Highs and lows of racing often follow in rapid succession. Yes, our sport is certainly a helter-skelter of emotions.

Great Sadness, but Magnificent Memories of Sir Henry Cecil

Everyone connected to racing has been hugely saddened this week, following the death on 11th June of Sir Henry Cecil. It would be hard to think of anyone in our sport who has been so loved by the whole racing community. A huge loss, but also as the incredibly moving obituaries have emerged over the week – particularly the one by Alastair Down in the Racing Post – there has been such a sense of reflection on and celebration of a magnificent training career. This is bound to pervade the whole of Royal Ascot next week. Apparently there is going to be a minute’s silence when the meeting opens on Tuesday, and the Queen’s Vase on Friday will be formally run in his memory.

It is actually difficult to grasp the enormity of his success since 1969, when he started training: 3,431 worldwide wins, 418 pattern races, 25 British Classic wins, 75 winners at Royal Ascot and 10 trainer titles. I’m sure we all have our own favourite horses from a career that spanned five decades. Few trainers have ever been so naturally gifted in the conditioning and training of the thoroughbred, particularly stayers. It seems a long time ago now, but I can still visualise the bold determination of that contrary character Le Moss winning the stayers’ triple crown of Ascot, Goodwood and Doncaster Gold Cups at the end of the 1970s. And amazingly Sir Henry did the same again with Ardross at the start of the following decade. He won the fillies’ Triple Crown with Oh So Sharp in 1985, and then exceeded that performance with the mighty Reference Point who completely dominated the Derby, King George and St. Leger with his captivating front-running style in 1987. I thought he wouldn’t be surpassed. But then, in the twilight of Sir Henry’s career, along came Frankel.

After the glory days, it was so sad to see the training and personal decline of Sir Henry to the nadir of 2005 when he was barely in the top 100 trainer list, and had been reduced to a miserly 12 winners. Worse was to come, with the physical decline as stomach cancer took its grip. And yet, in the same way that his beloved roses would often have a late-flowering bloom, so Frankel provided the perfect ending to a magnificent Indian summer that began with Light Shift in 2007 and ran through to Champions’ Day at Ascot in the Autumn of 2012. I always felt that Frankel’s most brilliant performance was in the Queen Anne at Royal Ascot that year, when he thrashed Excelebration by 11 lengths and earned the highest ever Racing Post rating of 143. My wife Jack has a different view and thinks the 7-length victory in the Juddmonte International at York was more impressive for being over a longer trip. We were both on the Knavesmire that day, where the sense of the crowd’s overpowering goodwill towards the agonisingly frail trainer was almost tangible. We also both went to Champions’ Day to watch that victory, and followed Frankel in his final departure from the paddock, heading for his new career at stud. It was such a poignant moment, partly to see the last of a racehorse who had been undefeated over three seasons, but also because we believed he had helped keep his trainer alive, and that without him it would be hard to survive for very long. And so it has proved.

The five best Flat trainers I’ve seen are Vincent O’Brien, André Fabre, Sir Michael Stoute, Aidan O’Brien and Sir Henry Cecil. There are common characteristics: instinctive empathy for the racehorse, extreme patience and the ability to fine-tune and channel a horse’s natural talent so that it can deliver the highest quality of performance on the track. But to my eyes Sir Henry would be primus inter pares when compared to those other great trainers. Most definitely first amongst equals, not only because of what he achieved in training terms but through his charm, approachability and self-effacing dignity. A much-loved person who will be massively missed, not just by his friends and family but by the whole racing community.

Derby Day – Everything Crossed for the Burkes and Libertarian

By the time you read this, the result of the Derby may already be known. It is always one of my favourite races of the year, and it is great to have something to cheer about, after all the doping and corruption revelations of the last couple of weeks. It has had a special place in my heart ever since, as a student, I backed Morston at 25/1 just after completing Finals. I think I probably have fonder memories of that betting slip than I do of my degree certificate. It certainly guaranteed an enjoyable summer, with student days behind me. 33 years later, I ended up living alongside the Woolley Down gallops where Morston and Blakeney were trained – so, happy memories.

This year, I suppose everything depends on whether you believe Dawn Approach will stay, or not. With a few exceptions such as Sea The Stars, not many Guineas winners have done so; I think he may be a doubtful stayer, and definitely far too short a price. The Aidan O’Brien runners are bound to test him. Battle Of Marengo may be his best, but he seems quite exposed. Are Ocavango and Chopin any good? I liked the way Ruler Of The World won at Chester, and he is on my shortlist, but without any doubt the Owners for Owners community is bound to be behind Libertarian.

We had our final “Meet the Trainer” morning at Elaine and Karl Burke’s stables the day after the Dante. Most of us had backed Libertarian at 33/1, so it was a real privilege to be able to stand alongside the horse at Spigot Lodge. There may only have been a few of us there, but we had a terrific morning. I hope everyone else was forming an orderly queue outside various bookies, lumping on at 20/1+ for the Derby. We saw our horses Paradise Spectre and Aran Sky up on the High Moor gallops, did the posing with Libertarian and then took Karl and Elaine off to the Wensleydale Heifer for a good lunch. Amazingly, it was Karl’s 50th birthday as well, so there was a lot to celebrate. When we expressed amazement, he came out with the great line: “You don’t think I’m 60, do you?”

Anoraks like me love stats and history. Libertarian is the first Yorkshire-trained horse to have won the Dante since Dante, so it was a fabulous achievement by the Burkes. They bought him out of a breeze-up for 40,000gns. Despite having done the slowest time at the sales, he is a lovely, strapping son of New Approach and no matter what happens today he can only improve this season, and into next. Elsewhere on the web site I have sung the praises of Karl Burke and Lars Kelp in spotting high-potential horses. Look no further for proof. By the way, Spigot Lodge is named after Jack Spigot, the 1821 St. Leger winner, and The Flying Dutchman won the 1849 Derby from these stables, before his famous match against Voltigeur on the Knavesmire at York in front of a crowd of 100,000. But I bet you knew that anyway. The BHA’s Great British Racing campaigns have got a bit of catching up to do!

However, the main reason I’ll be cheering Libertarian home today is that it signals the return to the top flight of training for the whole Burke yard. Back in the dark days of 2009, when Karl was warned off for a year for passing information to a very dodgy character, Miles Rogers, there was a possibility that all their hard work and endeavour would have been in vain, with their whole livelihood falling apart. Karl had just won his first Group 1 with Lord Shanakill at Chantilly, and was on the point of breaking through to the top ranks of training. Within weeks the number of horses in the yard had dropped from 90 to 25, and most of the staff were laid off. It was an agonisingly sad time for everyone. We kept our faith in and support for the yard, and nothing will give me greater pleasure than seeing a good run today from Libertarian. Everything crossed. As a horse who will only mature with time, there is always a risk that he may not have the necessary luck in running at Epsom. Let’s hope that he breaks well and William Buick is able to have him in a forward position at the top of the hill. If not, never mind - his day is bound to come. I’m already on for the Leger!

Hats off to Karl, Elaine, Kelly and Lucy Burke and all the crew up at Spigot Lodge. As Derek Thompson would doubtless say: “Enjoy the moment.”