Who is an owner? What's your story?

[parsixfarms]

The most telling statement is where he says that "We do not take a position in the horses ourselves if we can help it." So basically, the West Point principals are participating in the horse business entirely with other people's money, with West Point incurring risk only if their rather large mark-ups fail to cover any unsold shares in the horses.

[Storm Cadet]

Originally Posted by parsixfarms

The most telling statement is where he says that "We do not take a position in the horses ourselves if we can help it." So basically, the West Point principals are participating in the horse business entirely with other people's money, with West Point incurring risk only if their rather large mark-ups fail to cover any unsold shares in the horses.

All the horse partnership companies operate that way. That's their goal as we discussed earlier. Sell out all partnerships. If you build 10 homes in a development, does the builder only sell 9?

[parsixfarms]

Storm Cadet,

I fail to see your point. As the manager of a small upstate NY partnership, I find it much easier to recommend that people buy into a horse in which I already have a significant stake. It's one thing to say that their goal is to sell out all shares in all horses. Who doesn't want to do this? It's quite another thing to say that their goal is to sell out shares in horses in which they do not want to risk their own money. And they are clearly saying that they do not want to have any "skin in the game."

[Storm Cadet]

Originally Posted by parsixfarms

Storm Cadet,

I fail to see your point. As the manager of a small upstate NY partnership, I find it much easier to recommend that people buy into a horse in which I already have a significant stake. It's one thing to say that their goal is to sell out all shares in all horses. Who doesn't want to do this? It's quite another thing to say that their goal is to sell out shares in horses in which they do not want to risk their own money. And they are clearly saying that they do not want to have any "skin in the game."

Do you charge management fees to your clients or any markups on purchase fees, trainers fees or anything else?

[parsixfarms]

Originally Posted by Storm Cadet

Do you charge management fees to your clients or any markups on purchase fees, trainers fees or anything else?

No, I don't. I am simply reimbursed for the actual expenses that I incur on behalf of the stable.

[Storm Cadet]

Originally Posted by parsixfarms

No, I don't. I am simply reimbursed for the actual expenses that I incur on behalf of the stable.

See that's what I'm talking about! You'd make a killing down here with all the people that have gone the other way and left the business because of excessive markups, training fees, vet fees marked up etc.

C'mon on down!

[NoLuvForPletch]

Originally Posted by Storm Cadet

See that's what I'm talking about! You'd make a killing down here with all the people that have gone the other way and left the business because of excessive markups, training fees, vet fees marked up etc.

C'mon on down!

The mark-ups are really the only problem. Obviously vets, dentists and the cost of boarding a horse are expenses that go along with the game. But marking up an animal, to cover your own costs and then some while not taking a position in the horse is where I have the problem. They are at NO RISK WHATSOEVER once the animal is syndicated, so their actions after their exposure is gone will always be questioned. The only incentive there is after that is either the ability to get these "investors" (I refuse to call them partners because they are not partners with WPT at all) to continue to pay the piper for more overpriced animals and/or they happen to get lucky with an ERINSOUTHERNMAN type, where the braniacs at WinStar give them a small fortune, they get a percentage of that money. Otherwise, they just put Sherm's race call on an ESPN broadcast and hope for more "investors" to call.

[NoLuvForPletch]

Originally Posted by Storm Cadet

All the horse partnership companies operate that way. That's their goal as we discussed earlier. Sell out all partnerships. If you build 10 homes in a development, does the builder only sell 9?

Actually, all horse partnerships do not operate this way. The partnership I am involved in does have a position in the horse. As Terry says, their partnerships are not for everyone. I'm not defending that statement, but at least they are open about it and are comfortable with the idea that they are purchasing an animal for a significant amount less than what they are syndicating it for. It is the buyer's responsibility to understand what the deal is and that they are paying $44,000 for 10% of a horse that WPT purchased at auction for $205,000.

Personally I think it is tough enough break even in the game that paying twice as much for an animal than it was valued at auction just a short time prior is tough to swallow. On top of that they charge a maintainance fee and take money off the top of the earnings after a certain level. For each of the good stories (Flashy Bull, High Finance and Dream Rush) there are 5 not so good one's.

But like I previously stated, if you are looking for the stuff that they are offering for the mark-up (whatever that might be when they call themselves the "Ritz Carlton of the Industry"), apparently they are your guys.

[Storm Cadet]

Like Terry said, and I'm not endorsing West Point here, I left them years ago, is that some FOR PROFIT business models like his, Dogwood, Peachtree, Sovereign et al, do operate this way and they are very successfull with it.It's just another business model that they are comfortable with. It is NOT for everybody and they admit it!

I would love to start a stable and share like you do. We all split the risk! In fact a group of former CVF owners are trying to form their own with the main startup person holding 50% stake.

[geeker2]

I am envious..I am involved in a Racing Partnership where we can even get he Major Partner to give us the Financials.

Needless to say the experience has been less than fulfilling

[The Bid]

How envious can one be of a business outline that doubles the purchase price of a horse? You would think they were brokering diamonds or selling cars, to me its excessive

[Storm Cadet]

Originally Posted by The Bid

How envious can one be of a business outline that doubles the purchase price of a horse? You would think they were brokering diamonds or selling cars, to me its excessive

I agree, thats one reason why I left...to try and find one with more horse flesh and less markup! I don't need all the advertising and stuff...give me Holiday Inn Express. A winner on the track is a winner on the track.