[Linny]

Breeding can be very risky. Read the BH headlines during the spring and see how many mares die during foaling or from complications. That's just the prominent mares, and assume that those mares are getting (literally) the best care in the world.
Mares get hit by lightning. Strawberry Reason was kicked in the head by a pasture-mate. Mares colic after a late term foal twists strangely in utero and both mare and foal die.
Breeding also requires a willingness to wait a long time for possible profits. Retire a mare today and breed her in spring of 2009. Before the foal is on the ground you have board and care bills for possibly 18 months. It's spring of 2010 and the blessed event occurs. Add in mare and foal board plus expenses for the baby and of course the stud fee, plus costs involved in getting mare re-bred after the 2010 baby is born.
The soonest you can get anything back (unless you choose to sell the mare in 2009) is when you can sell the foal as a weanling in 2010. Weaners don't bring a ton of money but that mare and baby are racking up tons of bills. You opt to keep foal and sell as a yearling. Now you send him off to a consignor's farm to be spiffed up, taught to walk nicely for buyers, fed a rich diet and hopefully make you some money. Those services are not cheap and the sales company gets their cut as well.
Maybe you do OK. You sell the foal for 3x the stud fee which sounds like a nice profit but the sales agent, sales company, vet, farrier, etc all get paid. Meanwhile the mare has had another foal, but this one was born crooked and you still have to pay the fee, plus board etc and the baby might need some surgical procedure to ever make him viable. There goes the profit from the one just sold...

Obviously, when you have a herd of mares the economies of scale can help, but sometimes that "big one" needs to be pretty big to carry the whole operation.