Versailles, Kentucky, USA - September 30, 2020 - In the short span of 48 days, four fillies and a gelding from Tropical ...
Background
The thoroughbred industry generates over 1 billion dollars in public horse auction sales annually
The everyday horse enthusiast now has the chance to participate and profit from their interest. With Tropical Racing, you don't just buy into a racehorse; you get your own piece of a racing franchise.
Horse racing is an exclusive sport and an even more exclusive business, a private club for nobility and billionaires. It's not just the high price of entry that has kept investors out—it's the need for inside knowledge and a well-run operation before one can begin to turn a profit. Getting access to a horse racing franchise usually takes years on the scene and millions of dollars.
We're changing that.
Through this offering, all types of folks, from enthusiasts to new owners, have the chance to own "a piece of the house" by investing in an asset backed sports franchise—Tropical Racing.
For us, horse racing is more than just a sport. It’s our business and our passion.
Concept
Nestled in the heart of thoroughbred country on 200 acres of prime Kentucky bluegrass lives one of America’s finest thoroughbred racing and breeding operations, Tropical Racing
Through strategic acquisitions, breeding, and training programs, our team is dedicated to producing world class championship thoroughbred racehorses.
Property
Our farm's location in central Kentucky offers a strategic advantage for racehorse owners. Those within the bluegrass community have advanced knowledge of exceptional offerings, are amongst the first to know about the next “hot” stallion, and are positioned to purchase one-of-a-kind horses that may have slipped through the cracks at auction.
Having the right infrastructure in place reduces the maintenance costs of young horses in training. Feed and housing fees are greatly reduced, and the logistics behind transporting horses are simplified. Everything becomes a well-controlled, in-house strategy. Stable management is streamlined and efficient, saving our partners and shareholders money and advancing our horses throughout their careers and into their retirement.
Property Features:
Training facilities
Tropical Racing’s thoroughbreds are developed and conditioned by trainer Michelle Nihei
Michelle first established herself as a trainer in 2008, winning her first stake race that same year. With only 20 horses in her stable, she went on to win multiple graded stakes, headed by Prince Will I Am, winner in Grade I, the most competitive race category in the United States, as well as graded stakes winners Regalo Mia and Upgrade.
Tropical Racing’s 2-year olds begin their racing careers with Michelle early in the spring. The ability of each horse is assessed by their performance in the mornings and within the first few races. Individual achievement determines future races and the locations of racing opportunities.
Portfolio
By the end of Q2 2021, Tropical Racing expects to have more than 50 thoroughbred horses in our portfolio
This includes a winning combination of racehorses, broodmares and foals.
We expect to expand our stables throughout 2021, and strive to have a portfolio of 65-75 horses by year end.
Tropical Racing recently acquired a share of the millionaire winner stallion, Global Campaign, sired by the champion Curlin out of the A.P. Indy mare Globe Trot.
This means Tropical Racing owns lifetime breeding rights to Global Campaign, and for 4 years a reserved place for 2 mares along with participation in the stallion’s profits. Tropical Racing maintains the right to sell our share down the road.
As our operations continue to grow we plan to add more stallions to our ranch’s portfolio.
Customers
Our customers include the over 185,000 current racehorse owners and the millions of horse racing enthusiasts that have wanted to be able to participate in the thoroughbred industry but until now, haven't known how
Business model
Our Revenue Streams:
1. Thoroughbred Syndication
A syndication partnership offers thoroughbred enthusiasts a more affordable and risk adverse path to racehorse ownership, while also giving new owners a chance to learn the ropes. Tropical Racing’s syndication options offer a percentage of a horse or groups of horses. Below is an example of a typical transaction:
At times we may choose to increase our ownership percentage to much larger than the 10% ownership interest if it makes financial sense to our operations. That said, past performance is not indicative of future results.
2. Horse Sales
Our team is also active at the major thoroughbred yearling sales, including the Keeneland September Sale, Saratoga Yearling Sale and OBS Yearling Sale. With our extensive connections we also buy and sell our horses privately when it makes economic sense for the team and investors.
These stunning thoroughbreds are living, breathing animals, and also tremendous financial assets. Selecting the best assets from thousands offered for sale each year demands a set of finely-honed skills and hands-on knowledge, combined with an ability to properly analyze the market. That’s why Tropical Racing works only with a handpicked group of the country's finest bloodstock agents.
3. Broodmare Breeding Program
Each broodmare represents a unique set of genetics that determine her breeding and racing potential. A winning thoroughbred foal is the result of a well-designed broodmare management program. Each broodmare represents a unique combination of breeding, racing, and genetic characteristics.
Yearlings are purchased with a primary focus on pedigree and conformation so the value of each healthy foal generally mirrors the dam’s value. As the siblings achieve in better races the younger foals’ appraisal increases.
These two auctions are amongst two of the world's largest and most prestigious sale events in the racing industry and attract international participants.
4. Circle 8 Pinhooking Group
ON AVERAGE SINCE 2015 PINHOOKING TRANSACTIONS ACROSS THE INDUSTRY HAVE SUSTAINED A 20% NET PROFIT.
Many of today’s race horses were “pinhooks,”meaning they were typically bought as yearlings, then trained and sold the following year as two year olds.
In fact, the strongest market for young thoroughbreds is at the multiple two-year-olds-in-training sales held annually at reputable sales companies around the country. These sales are frequented by trainers and owners across the U.S., as well as international buyers.
5. Stud Service
Tropical Racing recently acquired a share of the millionaire winner stallion, Global Campaign, sired by the champion Curlin out of the A.P. Indy mare Globe Trot. This means Tropical Racing owns lifetime breeding rights to Global Campaign, and for 4 years a reserved place for 2 mares along with participation in the stallion’s profits. Tropical Racing maintains the right to sell our share down the road.
6. Race Earnings
In 2019, Tropical Racing brought in over 300K in purse winnings. With an expanded portfolio, increased training facilities, new breeding partnerships and more young horses graduating our training program every month our management team anticipates that number to increase to over 1M for the 2021 racing season.
Pictured above Margaret's Joy, winning 1st place at Churchill Downs in November 2020.
Market
$102B U.S. equine industry
The equine industry is one of the biggest industries that is hidden in plain sight. Most people outside (and many within) have no idea the global scale and significance of this space.
The thoroughbred industry has remained despite every World War, depression, recession, stock market crash, and every real estate crunch. In fact, Pinhooking sales from thoroughbreds during the 2008/2009 economic downturn still should a positive ROR of 27%.
Competition
Regardless of the size of other thoroughbred operations, our true competition will always come down to the individual racehorse we're competing against at the gate. The great thing about our industry is that more often than not our competition will also become our customer, client and partner.
Vision and strategy
Main Street investors can own a piece of an industry that has been the private playground of kings and queens, hedge fund tycoons and sheiks
Today, you can cross over the “velvet rope” and take your stake in this $102 billion industry.
At Tropical Racing, we have a modern take on an ancient sport that promises to be lucrative and exciting—and we're happy you're along for the ride.
Funding
$4.9 million raised to date
Tropical Racing's team is excited about this great opportunity to reach a larger investor base and bring in individuals who wouldn't normally have the avenue to get involved in this hidden gem of an industry.
Founders
Born in Queens, NY, Troy's love for the horseracing industry began when his father took him to the racetrack when he was 13 years old. From there, Troy's career started at age 16. When he was 18, he became one of the youngest trainers in New York. He attended Long Island University and continued to train horses for the next 7 years. Troy started a family and felt traveling up and down the east coast was getting harder. With that he turned a 180 and headed to the financial industry. During the next chapter in his life, Troy became a stockbroker, trading for companies like Spear Leeds and Kellogg.
Troy has owned numerous successful businesses over the years while always involved in the racehorse industry. Studying, breeding, buying and selling racehorses, his true passion was undeniable. Troy's dedication and expertise with racing grew to include breeding, syndication, and in 2017, forming his own racing partnership group, Tropical Racing.
With his background in finance, Troy is able to find inefficiencies in the pricing of horses. Unlike the stock market, there isn’t a public market or exchange for horse pricing. This means savvy players are able to take advantage of one of the few non-computerized asset classes left on the planet.
And by exploiting these inefficiencies, Troy and his team are able to reap windfalls from buying, selling, and syndicating the right horses. A story like Troy’s just goes to show how excellence in this industry is not just something anyone can attain. It takes a lifetime of dedication, building the right connections, and gaining the right knowledge to properly succeed in the sport of Kings and Queens.