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5 Things to Consider, if You’re Thinking of Co-owning a Racehorse with Family and Friends
So you’re at the pub or in attendance during a family gathering. Someone among your group gets onto the topic of their latest successful punt at the races — the discussion travels on, and at some point, it’s proposed to the group that co-owning a horse would be a worthwhile endeavour. If the scenario doesn’t strike you as familiar at all, we’re willing to think that the matter being brought up will tend to be a question of when, more than why.
We covered the different forms of racehorse ownership available, in one of our earlier blog posts. You might have recognised the premise we’ve introduced in this article as co-ownership — which sees up to 12 people jointly owning a racehorse. If you’ve been thinking about how you might pull this one off, it could be worth your time to consider these 5 pointers. While it’s always an exciting prospect to share in trusted company, it’s always worth the effort of foresight to ensure smooth travels ahead for your merry band of co-owners.
- Who’s In Charge of What?
Joint ownerships can feature as little as two partners, as far as the legality and registration concern. Of course, racehorses under a joint ownership tend to run with a name that’s decided upon by every member under registration — be they a group of 6 or 12 co-owners. Naturally, any decision to co-own a racehorse begins with assumptions of investment cost split equally among the owners.
Yet there’s more to consider than just how to split the bill. Beyond the initial purchase, there’s obviously running costs involved, specifically to do with training and upkeep. While the group can easily get together to make these decisions, it’s prudent to consider having everything down in writing. What will it cost to train and stable your horse for a year, and how can your group agree to split this cost evenly among each other?
With smaller groups, you might find that some members may be more keen to shoulder the responsibility of training costs — and it’s always good to keep this mutual appreciation for the shared responsibility that co-ownership will involve.
- Always Appoint Someone In Charge
If you see the sense in appointing one of your mates to split the pub bill, then it makes absolute sense to nominate someone responsible among you to manage your co-ownership. This becomes especially useful in instances where you might be co-owning as a large group. Appointing a family member or one of your best mates to make management decisions can help keep your co-ownership impartial and objective, when it comes to facilitating a healthy racing career for your newly-purchased yearling.
By all means, take your decision making to a vote — but when it comes to splitting the bill and ensuring your racehorse has all it needs to perform on the track, there’s nothing like a good manager to help you keep your co-ownership well-put together.
- Consider Forming a Limited Liability Company or Partnership
The facts of co-ownership can always effectively be surmised with the word ‘responsibility’. Keeping this in mind, it’s worth considering making your co-ownership as official as possible, by setting up a Limited Liability Company (LLC), or Partnership. Apart from keeping your responsibilities documented and outlined, forming a company or partnership provides an avenue for liability protection, in the event of any unforeseen negative situations.
Under a co-ownership, you may be liable for accidents not covered even by liability insurance. Under an LLC, this may provide your group of co-owners with additional control of your financial responsibilities, should the need arise.
- Will Your Racehorse Trainer Be Involved?
Few things will complement your management of a racehorse co-ownership agreement, like involving your trainer with the decision making. Plenty of co-ownership agreements see trainer-managed arrangements that place your trainer in charge of handling training and upkeep decisions.
This definitely appeals more to unseasoned or less-experienced co-owners, and provides an ideal way for fresh owners to comfortably navigate their responsibilities at a novice’s pace.
- Do Your Budgeting In Case Someone Pulls Out!
While it’s great to keep optimistic about your new co-ownership endeavour, it never hurts to protect your investment and ensure the wellbeing of your horse, with ample budgeting. It is a dynamic and exciting sport after all, and injuries can arise as a consideration for your group of co-owners to manage. It isn’t unheard of to see co-owners pulling out of an agreement one by one, especially in the event of significant adversity.
A bad enough injury sustained on the track can dampen the resolve of more casual co-owners, leaving the onus of responsibility upon those left in the agreement. The worst possible outcome is to see your racehorse untreated and cared for after its injury — just because other co-owners aren’t as confident in the future of its career! Budgeting ahead to ensure you’ll be able to sustain the cost of care for the duration of your racehorse’s career is the responsible thing to do: not simply because of the financial commitment, but especially since your racehorse deserves your duty of care, whether on or off the race track!
Nakeeta by half a length
Nakeeta
Ebor winner 2017
Nakeeta
The Ebor winner for 2017 makes this horse ideal to win the Melbourne Cup.
A nose
2leghths
Nakeeta by 3/4 of a length
0.75 lengths
1/2 length first Scottish horse to win
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1.5 lengths
I think by a photo finish
.4 length
Will win by 1.25Lengths
3 Lengths
Its a guess
Nakeeta will win by 1.75 lengths
3/4 length
A head
Nose
0.5L
1 length
Half a head
Neck