This micro-ownership company won the Kentucky Derby - now it's coming to Europe

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Syndicate ownership in Britain and Ireland has a significant new player, following the launch on Tuesday of MyRacehorse, a spectacularly well-funded micro-ownership company which had a dream start in the US when it owned part of the 2020 Kentucky Derby winner Authentic. It now seeks to become a major player on these shores from a standing start, with three as-yet unnamed juveniles in training with John Gosden, Andrew Balding and Joseph O'Brien.

"We're here to add to the racing industry," its UK and Ireland managing partner Jules Pittam told the Front Runner, "by allowing people to buy shares in top-class horses with some of the world's best trainers and hopefully get them on a journey that they can enjoy through the digital experience, enjoy that feeling of owning elite racehorses and running in the best races.

"It's primarily elite horses, that's our aim. Getting access to elite horses is difficult because most syndicates tend to go mid-to-low-range but we're aiming right at the top."

That ambition is shown by the prices paid at auction last year for their three horses, totalling over £800,000. And this is just the beginning, Pittam says. He expects the group will have 15 to 20 horses carrying its colours by the end of the year, rising to 50 by the end of next year.

He declines to name those who are bankrolling MyRacehorse but describes them as "seasoned investors who like the idea of the business and the potential growth opportunities, not just in racing but other sports as well". He notes that Andrew Rosen, founder of the Theory fashion brand, is a partner with MyRacehorse in a son of Dubawi.

But it will be hard to repeat the success of Authentic, surely? Even the fabulously wealthy can find top-level success hard to come by, after decades of investment.

"There's going to be some disappointments, there's no doubt about that. That's racing. But history shows us, through our stats in the US and Australia, that the better the horses you buy and the more you buy of them, the better your chances of racing on the bigger days, aiming at the best prize money and potentially going on to a breeding career."

You can buy a share in the most affordable of MyRacehorse's two-year-olds for £89, the sort of sum that allows a much wider circle of people to get involved in ownership than in the past. Of course, that doesn't get you much: you'd then own a 0.025 per cent share, to be exact. Perhaps as many as 3,999 people would have the same claim on the horse as you would.

The filly in question, by Zoffany out of Toi Et Moi, fetched €170,000 at auction in September. That comes to just over £140,000 at current rates, so MyRacehorse is allowing itself a significant mark-up here. If they sold 4,000 shares at £89, that brings in £356,000 and it is a similar story with the other two horses.

'The aim is to be transparent'

Even allowing for all the subsequent costs, like years of training fees and vet bills, MyRacehorse appear to have provided themselves with a healthy margin. But the numbers are there for all to see on its website and it's a startup company which makes no bones about its intent to make a profit.

"The aim is to be transparent and the margin we're charging, net of any costs, we think is very reasonable," Pittam says.

"The BHA have been absolutely fantastic from the word go. They were really clear and concise about what we could and can't do. They love that we are bringing transparency and governance. They're incredibly supportive.

"Every day, we update our shareholder table. The BHA are keen to see transparency in the industry, so we've taken a lead and we'll be publishing that to the BHA weekly.

"When you buy a share, we break down every cost for you, so you can see what's going into training, vets, what's in our due diligence and management fee, what the value of the horse is."

Heartache and her winning syndicate members after winning the 2017 Queen Mary StakesCredit: Edward Whitaker

Interestingly, MyRacehorse is working on a secondary market, which will allow shares to be sold on. Pittam, whose background is in the financial markets, says this will demonstrate the actual value of a share in a particular horse at any one time.

"If you buy a share for £100, the horse bolts up in a maiden, we're going to match buyers and sellers and you can sell the share at a higher price, and buy something else or take your cash out." He hopes the idea will come to fruition in the second half of this year. "Things can change, it's technology, it's not easy."

The MyRacehorse website has a lengthy FAQ section which includes this: "If the horse is ultimately profitable – which is measured against the cost of purchasing the horse, training, maintenance, and other costs associated with operating the syndicate – you can expect to receive a dividend."

Some of the thousands who bought into Authentic before his moment of glory in the Kentucky Derby were apparently taken aback to learn they would not be getting a share in the prize money. "That was made clear in the offering," Pittam says. "Although some people were disappointed, they didn't read the offering in detail." He believes the horse's stud fees will eventually cheer up Authentic's investors.

Even if your horse fails to perform at anything like that level, Pittam and his colleagues aim to ensure you get the most out of the experience. "It's about keeping those updates coming, so they can feel proximity and involvement, as close as we can to as if you were the 75 per cent owner. And in the digital world, that's so much easier than it was. Content to us is really important."

He hopes MyRacehorse can help the sport to expand its audience. "There's an inner circle of people who are desperately keen on racing and then there's the casual racegoer. We're interested in both and we want to broaden that circle, so we're getting to all those people.

"A lot of people go racing in Britain at least one a year and we want them to go, feeling that they've got an involvement, that they really care about that horse, they've been through the ups and downs. It's the democratisation of the sport, if you like. Rather than all the greatest horses being owned by people with deep pockets, this is a chance for top-quality horses to be owned by anyone who wants a fractional share."

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The Front Runner is our latest email newsletter available exclusively to Members' Club Ultimate subscribers. Chris Cook, a four-time Racing Reporter of the Year award winner, provides his take on the day's biggest stories and tips for the upcoming racing every morning from Monday to Friday