Syndication for the "average" person

[NCRider]

I normally agree with JER but I do think there are aspects to this B share business that could be attractive. 1-If you don’t have to buy into the horse’s value, the cost per share can be significantly less, 2-you still get to say you’re part of the ownership team of a particular horse which is different than saying you’re a supporter of Rider X in terms of how you are treated and how it makes you feel and 3-if we’re all being honest, there’s never any intention to sell the horse if things work out so why put in extra $ to have equity in the animal that you’ll never get out and 4-it eliminates any debate about who is in charge of what, when and how the horse competes or is sold.
Call me crazy, but I don’t see it as so bad of an idea. I guess we’ll see in practice how it works.

I also don’t think the Ollie Townend way of selling all your good horses is the only way to do it. Until you’ve been around Rolex at lease once, I think it’s premature to think you need to sell your only really good horse because you never know if you’re going to get another one to take you there and if you don’t, it’s all moot.

And as for KOC/Mr. Medicott and Doug Payne and Running Order, they needed syndicate members to buy into what I assue were very large purchase prices.

[RAyers]

[QUOTE=NCRider;7043086]
I normally agree with JER but I do think there are aspects to this B share business that could be attractive. 1-If you don’t have to buy into the horse’s value, the cost per share can be significantly less, 2-you still get to say you’re part of the ownership team of a particular horse which is different than saying you’re a supporter of Rider X in terms of how you are treated and how it makes you feel and 3-if we’re all being honest, there’s never any intention to sell the horse if things work out so why put in extra $ to have equity in the animal that you’ll never get out and 4-it eliminates any debate about who is in charge of what, when and how the horse competes or is sold.
Call me crazy, but I don’t see it as so bad of an idea. I guess we’ll see in practice how it works. [/QUOTE]

In this case B-share holders are NOT part of the ownership team. The B-shares described are the equivalent of a person asking you for $100 for gas. Do you own part of the their car now? If they are a friend, sure, you can give them the money. But there is no incentive for a stranger to contribute.

In my company, B-share holders have no voting privileges but they do get stock value and as such, if the company does well, they get money. I have to give something to get something. The shares the OP describes are BS (not because of her but because of bad advice).

[NCRider]

[QUOTE=RAyers;7043145]
In this case B-share holders are NOT part of the ownership team. The B-shares described are the equivalent of a person asking you for $100 for gas. Do you own part of the their car now? If they are a friend, sure, you can give them the money. But there is no incentive for a stranger to contribute.

In my company, B-share holders have no voting privileges but they do get stock value and as such, if the company does well, they get money. I have to give something to get something. The shares the OP describes are BS (not because of her but because of bad advice).[/QUOTE]

I don’t think it’s BS at all. Correct me if I’m wrong, but I’m under the impression that they way they’re setting these things up, B share owners are treated like owners vis a vis everything except for proceeds on sale. Ownership perks, course walks, dinners, access, etc. Again, since the intent is not to sell, it’s not like they’re missing out on much in most cases. If you’re investing in an event horse to make a profit, you’re nuts.

[RAyers]

[QUOTE=NCRider;7043165]
I don’t think it’s BS at all. Correct me if I’m wrong, but I’m under the impression that they way they’re setting these things up, B share owners are treated like owners vis a vis everything except for proceeds on sale. Ownership perks, course walks, dinners, access, etc. Again, since the intent is not to sell, it’s not like they’re missing out on much in most cases. If you’re investing in an event horse to make a profit, you’re nuts.[/QUOTE]

How can a B-share holder be an “owner” when there is no intrinsic value being created or controlled? Is their syndicate on the entry as owners? If not, how do they access? And if you put the syndicate down as “owner” they then could claim “ownership” as documented on entries and then the real “owner” opens themselves up for huge liability unless they have a very carefully crafted legal document. The idea of B-shares to help maintain a horse is simply begging and giving nothing in return.

I have said nothing about return. Investing in horses is a loss leader. Investors do it to reduce taxes. B-shares have no value so the investor can’t even take a tax break for the loss.

[WW_Queen]

[QUOTE=JER;7043016]
Why encourage people to go out there and pitch an appeal for donations dressed up to look like a business idea? No one with any business experience or any budgetary concerns is going to see it as an intelligent plan.[/QUOTE]

Agreed. B-shares sound like something you may be able to pitch to local equine companies for small amounts in exchange for promotion, book signings, maybe blog on their website, offer a free day of clinics to customers, whatever, may make sense. If the EOTF could get some sort of tax benefit to these B-shares, it could work… but as it they just sound like dressed up donations with no return.

I have met a couple of people who own BNH’s and/or support BNR’s… they are certainly the type who are not in it for a return on investment versus love of horses/the sport, but are extremely astute money-wise (otherwise they wouldn’t have money to blow on event horses in the first place! ). They have the money and flexibility to enjoy traveling to watch their horses go, attend the champagne dinners, etc. Convincing the big players on this B-share business just ain’t going to happen.

If you prove yourself as a rider (using whatever horses you have available), then you can start networking. Use social circles to attend events/parties where you can meet 'n greet these potential sponsors in a relaxed environment, not while you’re running in between phases. Be charming, funny and knowledgeable… people will want to get to know you, and more about your background/accomplishments/goals as a rider. Be interested in their horses, who they ride with, etc. and form a relationship. These are the people that, over time, you can feel comfortable picking up the phone or sending an email with a “listen, remember how we were talking about Normandy? Well I just got off a plane after seeing this incredible horse I think you should see …” kind of thing.

I know I’ve mentioned it before, but there was an interview on the Chris Stafford Radio Show about dressage in years past, and how the UK dressage scene grew. One particular rider recalled how at horse shows, she used to spend as much time as she could around her trailer, cleaning tack and chatting with people around her/passersby. After the show, she would be willing to share a glass of wine and chat about the show (her thoughts, their questions, etc.) with whomever was interested. As time passed, her reputation spread and her name grew and grew. She eventually met the right people through a clinic (or something like that) and her career took off with their support.

The point is, how many of us riders would easily say “I’m a horse person, not a people person?” when as a business, you NEED to be a people person. It’s a lot of work to always be on your game (especially during shows) but it will pay off.

[NeverTime]

Random thoughts:

1. I think the best way for an up-and-comer to find funding for their horse is to do something totally different than what everyone else is. I agree with others who have said this emphasis on syndication, especially for middle-of-the-pack horses, in a losing proposition … even more so when it has become the flavor of the week and, now, everyone’s being asked to help syndicate something.

Two examples from things the OP already has touched on are Bonnie Mosser and social media. IIRC, Bonnie found a sponsorship (not sure if it was financial or product, or the size of it) by pitching The North Face, saying her trailer going up and down I-95 to shows all summer was essentially a travelling billboard. The North Face put logos all over her trailer, and Bonnie got sponsorship from a non-tradiitonal source that isn’t already inundated with requests from riders. (I’m guessing, too, that deal involved NETWORKING through her then-boyfriend’s professional relationship with the company, as he is a North Face distributor.
In terms of social media, everyone and their brother has a blog now. Like asking for sponsorship, there’s a whole lot of fish in that pond now, and it’s hard to stand out. When I think of social media success in the event world, the person I think of is Peter Atkins: He was among the first (maybe THE first) professional rider to start posting those helmet-cam videos and really popularized that. It was such a unique thing, to have that view and be able to virtually ride a huge course. He turned that into a Facebook page, line of gear, sold videos of his helmet cam rides and built a fairly large fan base who helped contribute to causes from buying him a red coat to getting him overseas to compete. Riders, find YOUR “Run Henny Run.”

2. I agree about B-shares = BS. It’s a donation, and it’s insulting to the people you are asking to dress it up as anything other than that. I’m not sure what “ownership perks” would be involved, but I can tell you that Rolex doesn’t provide 100 (or even 10) sets of owners tickets/wristbands to one rider just because his/her horse has multiple syndicate owners. Call it a donation and be done with it.

3. The John Nunn thing, whether you are looking for sponsorship or syndication, this times 1000. I don’t understand why people pitch themselves by emphasizing what makes them special rather than emphasizing what supporting them can do for ME. If you want my money (and you are framing it as a business proposition rather than a charitable contribution) and not just my admiration, you are going to have to show me the second part.

[JER]

[QUOTE=WW_Queen;7043260]
After the show, she would be willing to share a glass of wine and chat about the show (her thoughts, their questions, etc.) with whomever was interested. As time passed, her reputation spread and her name grew and grew.[/QUOTE]

Who knew that freeloading drunkards were an untapped resource for those seeking sponsorships?

[WW_Queen]

[QUOTE=JER;7043284]
Who knew that freeloading drunkards were an untapped resource for those seeking sponsorships?

:D[/QUOTE]

Ha ha!! I’m pretty sure it was the RIDER who was willing to share her own stash… which in my books is a pretty good reason to get to know someone.

(Not to mention if you’re not good with “people” a little bit of wine will losen you up for sure!! You just have to be sure your groom is willing to drive you home afterwards :lol: )

[JER]

A distillation of this discussion is now up at EN: It’s All About the Horse

[retreadeventer]

I’m late to this party. Is this a discussion about creative forms of funding upper level riders …yawn… again …?

Really…I am busy. I am riding my intro horse, my BN horse and my old T horse and mixing up fly spray, cleaning stalls, mowing pastures, powerwashing the horse trailer (a bit soggy, that chore) and oh like working a 60 hour week at my job to pay for these guys. But I enjoy it. It’s all about the horses.

Syndication might work for about 10 horses in the United States right now, or less. Perhaps 15 to 20 riders. You have got to be kidding about these numbers and sponsorships…there’s no money for this. Until prize money gets at least worthwhile putting an entry in, nobody wants an event horse. The ones that fund this now are simply in it for fun. Just like me. But the difference is somebody tells them they need more money than I do to ride their own horses, and they believe their own PR. Get a job.

[soloudinhere]

[QUOTE=JER;7045355]
A distillation of this discussion is now up at EN: It’s All About the Horse[/QUOTE]

You know, I was sort of feeling the sympathy a little bit, if not really understanding, right up until the person said that all the options presented to her were not an option and this B share syndication was going to be it.

My family is a member of a couple syndicates for BNRs. I can’t see how we would ever consider a syndicate that didn’t give us ownership rights to help determine the competition schedule, etc. What’s the point? To contribute to someone’s career and have absolutely no say? We enjoy supporting the sport but I don’t see any reason to do it with no ownership stake, and a rider who envisons herself as too good to put her horse up for actual sale in full or in part to other parties doesn’t really feel like she really wants sponsorship, to me.

[NCRider]

[QUOTE=soloudinhere;7045546]
You know, I was sort of feeling the sympathy a little bit, if not really understanding, right up until the person said that all the options presented to her were not an option and this B share syndication was going to be it.

My family is a member of a couple syndicates for BNRs. I can’t see how we would ever consider a syndicate that didn’t give us ownership rights to help determine the competition schedule, etc. What’s the point? To contribute to someone’s career and have absolutely no say? We enjoy supporting the sport but I don’t see any reason to do it with no ownership stake, and a rider who envisons herself as too good to put her horse up for actual sale in full or in part to other parties doesn’t really feel like she really wants sponsorship, to me.[/QUOTE]

I really don’t get the hostility here. Of course a rider with only one big horse that she views as the key to her competitive future is going to be extremely nervous about having anyone else have control over that horse. That doesn’t mean she doesn’t want spomnsorship, it means she doesn’t necessarily trust people she may not know all that well. It also clearly doesn’t mean that she sees herself as too good to put her horse up for sale- if anything it shows that she sees herself as perhaps not powerful or important enough to effectively control a group of owners whose interests may not always align with hers.

Do syndicate members really get to determine the riders competition schedule? I thought the rider was usually the manager?

It seems to me that these things can be designed in a variety of ways and if it’s not your cup of tea, don’t invest in one. I’m certainly not planning to. I just don’t see the need to be so nasty with the OP unless you’ve got a personal beef with her.

[soloudinhere]

[QUOTE=NCRider;7045587]
I really don’t get the hostility here. Of course a rider with only one big horse that she views as the key to her competitive future is going to be extremely nervous about having anyone else have control over that horse. That doesn’t mean she doesn’t want spomnsorship, it means she doesn’t necessarily trust people she may not know all that well. It also clearly doesn’t mean that she sees herself as too good to put her horse up for sale- if anything it shows that she sees herself as perhaps not powerful or important enough to effectively control a group of owners whose interests may not always align with hers.

Do syndicate members really get to determine the riders competition schedule? I thought the rider was usually the manager?

It seems to me that these things can be designed in a variety of ways and if it’s not your cup of tea, don’t invest in one. I’m certainly not planning to. I just don’t see the need to be so nasty with the OP unless you’ve got a personal beef with her.[/QUOTE]

The rider is the manager, but we are a part of the overall planning of the schedule. If a horse needs to make a detour or be aimed for a particular event, we’re involved in that. The rider doesn’t call all the shots and just send us the bill-- at least not for the 2 riders we work with. They are responsible, just like any other company with shareholders, for providing us return on our investment ie good competition results. Most people involved in eventing syndicates are horse people and the riders are business people, we get the pros and cons of going to this event over that event and here’s the extra costs if we do this etc.

Syndicates have multiple members, so it’s not really “calling the shots” as an owner it’s more like being a voting board member in a business.

I’d be hesitant to invest in an unknown rider, with one horse, who doesn’t want to give up ownership shares in that horse and “retain complete control.” That’s not an investment, that’s a donation, as others have said. The B share has no meaning, B shares of what? Air? When you buy shares in a company, you are a part owner of that company. When you buy shares in a syndicate, you are part owner of that horse or group of horses. when you buy B shares, you are none of these things and have ownership of nothing, making it a pointless investment.

The B share is not something that would fly in showjumping, since there is prize money at stake. It sounds a lot like some event rider came up with this brilliant idea that they get all the money, and give nothing in return, since what exactly prevents them from just closing down the syndicate and moving on? Nothing. There is no planned return for these B share holders and therefore, this is not really any sort of investment business plan.

And the rider’s post about how people don’t get it, I don’t really feel helped her case.

[SuperEventer]

Just to clarify:

1. I never said “People don’t get it.” If that is what you are taking from the story, that was not my intention. My intention was for people to understand that, for me, my horse comes first. The advice I was receiving, for the most part, was very good business advice, however, a lot of the things (i.e. selling my horse to further myself, etc) were just not things I want to do with THIS particular horse.
2. The B Shares were not my idea. Honestly, I was going strictly by what I thought the Owner’s Task Force was telling me. However, when I went back with everyone’s input, we talked about it again, and it was all clarified to me. It was a misunderstanding, not ego.
3. Yes, it DOES scare me to sell shares of my horse. Again, this doesn’t make me egotistical. It just makes me wary of change and to give up a part of my horse to people I don’t know.
   Honestly, soloudinhere, I am sorry that you took my article negatively, as that is not how it was meant. It meant, FOR ME, syndication (assuming I even had the name to get people to want to back me) is scary, as I always want to put my horse first. Beyond that, Bug is that once in a lifetime horse for me.
   After everyone’s comments toward this whole ordeal, I think I will probably stay far away from syndication. I think it is definitely a great thing for the BNR’s, but obviously, the general opinion is that an unknown is not someone people want to invest in.

[SMF11]

So far you’ve been talking about approaching individuals. What about trying to come up with a sponsorship package for a company? It’s a long shot, but so is syndication to individuals or so it sounds.

I am not really an eventer, and so take this for what it is worth. I read your EN article and went to your website. The thing that is appealing about you and Bug is that you bought him off the track and have come so far with him. We all like an underdog, someone who’s put in the sweat equity versus buying their way to the top. It seems to me that this is your story, the unique thing that will appeal to potential sponsors.

I’m just in the beginning stages of starting a company and if we launch and are successful I want to find sponsorship opportunities – I think the horse world is undervalued as a way to get a message across. But, what I’m looking for is what’s going to give me the most bang for my buck – what’s going to get my product the MOST attention it can. I imagine that’s what any other company is also looking for. (I loved the North Face example).

Best of luck to you!

[poltroon]

SuperEventer, I applaud you for listening to what people have to say and having the strength to incorporate and consider it without reacting personally. It is a hard thing to do, but it is necessary: you need all the information you can get, and then having that, you need to plot a course that you can live with.

There are no guarantees, no one path that gets you funds, no one path that gets you success, no one path that even gets you happiness. Build yourself, build your horse, ride the luck, and thread the needle of life’s little detours as best you can.

We want success for you, for your horse, and for all the other riders like you out there. That is why people are throwing all these options out, so you get a sense of what other people have done and have had to do.

It is true that some paths are too costly, in terms of your horse, your soul, your relationships, or your pocketbook. It is wise to decide for yourself if those are paths you will not take, even if they worked for another.

So take care of your horse, take care of yourself, and may the Force be with you.

[retreadeventer]

The horse business is two things; it’s a sport business, fun, winning, traveling; and it’s business, making money (or losing money in a way that helps other parts of a business – such as creating a tax writeoff.) You have to decide for yourself if you’re in the sport half, or the business half. If you’re in the business half you have to sell horses because you can’t win enough prize money to pay for the horses’ expenses, as is done in Europe. If you’re in the sport half, you find a way to pay the way, either with a job (which can be a full time barn including clinics and teaching) and you win enough to get your name out there in the year end standings, pictures all over the internet, etc. and through that effort, attract support. And with enough support you can eventually quit the job and just do the horses as Amy Tryon did. But she worked a lot of years as an EMT.

[FitToBeTied]

I read the OP’s piece in EN and will disagree with the thought that “it’s all about the horse”. You are running a business and the horse is one of the assets of the business. Yes, you should provide the best possible care for your horse and look out for their best interests but the biggest asset of your business is yourself. If you don’t believe that look at Mr. Medicott. KOC couldn’t sell all of the shares because thee were questions about her riding future. That should tell you that syndicate owners bet more on the rider than the horse.

Syndication seems to be the latest hot thing in eventing but, as someone mentioned above, it is really only applicable to a few riders. A parallel to the syndication idea in horses is funding start-ups in the technology sector. There is an old saying that goes bet on the management team not the idea. Before investing in a start-up we spend more time on due diligence of the management team rather than the business idea.

I think the OP’s best option is sponsorship rather than syndication. There are a lot of good options for sponsorship for the creative professional rider.

[eqsiu]

OT, but I see that you are standing a stallion at stud? What breed approvals does he have? I didn’t see that on you webpage.

[SuperEventer]

[QUOTE=eqsiu;7046183]
OT, but I see that you are standing a stallion at stud? What breed approvals does he have? I didn’t see that on you webpage.[/QUOTE]

I do stand a stallion, Fuerst Rendition. He is by Fuerst Heinrich and is the only US bred son of him. Unfortunately, he was injured as a foal and was not supposed to be sound. I got him at age 4 and started him slowly at age 5. He is sound, but he is too old to do the stallion testing, nor can I afford it. We are going to try to get him approved through performance. He is registered Hano, but I am thinking we will go with ISR or Old. He’s quite a nice boy, and the babies he has on the ground so far are quite nice.