Making Plans to Buy a Racehorse – Thoroughbred Owner Academy

to buy a racehorse


You’ve made the decision to buy a racehorse. It’s a straightforward procedure, but like many “easy” things, it requires careful consideration and advance planning to look that way. A smart place to start is with a business strategy. The strategy should not be extensive or difficult, but it must include your goals, objectives, and estimated expenses. A strategy will help you manage your thoroughbred investment, but it will never be comprehensive since circumstances change.

Recall that investing in horses is a legal business activity, and the IRS will regard it as such if done correctly. Manage your equine investments accordingly, using good, sound business judgment as you would with any other investment or business endeavor.

to buy a racehorse

Putting a Business Plan Together to Buy a Racehorse

When creating a business strategy, keep in mind that Thoroughbred racing and breeding are both dynamic pursuits.

You’ll be better able to maintain focus and show that you’re actively participating if you have a detailed company strategy. You must make the investment with the goal of making money, according to tax regulations and common sense.

A solid business plan need not be difficult, but it should be prepared and contain the following details:

  • Establish the kind of business form you’ll be implementing. Is it a corporation, limited liability company, sole proprietorship, general or limited partnership? Make a list of your partners if you decide on a limited partnership. When choosing the right company structure for your requirements, you should take into account the unique economic and tax features that each form of business organization possesses.
  • Establish your objectives and goals. Is the operation primarily focused on breeding for racing, breeding to sell commercially, breeding to improve breeding stock, or breeding to sell financially, aside from having fun?
  • List the different types of consultants that will be employed. Depending on the situation, it can be useful to provide the names of the experts who were contacted as well as a brief summary of their qualifications.
  • Describe how the equine assets are acquired. Will the horses be acquired via claims, at auction, or privately?
  • Establish a schedule.
  • List the time and place of the operation. Will the company’s reach be local or global?
  • The project’s related expenses and income. Make a preliminary budget with attainable goals. The purchase price, depreciation, regular operating costs like board and lay-up costs, breeding costs, training costs, transportation invoices, veterinary and farrier costs, nomination, starting, and entry fees, administrative costs, insurance, professional services, travel, and entertainment should all be listed as budget line items at the very least.
  • Put together the required insurance. You should think about acquiring insurance to cover the related risks depending on the sort of horse investment you make. Which insurance plans, for instance, are suitable for transportation, mortality, fertility, live foals, and commercial general liability?
  • The timeframe of the activity should be made very clear. Do you want to continue operating your horse business perpetually or will you set a time limit on it? For instance, if your goal is to race, you may write that you want to assess each horse’s performance annually. Based on how the horse performs, decide whether to keep racing it, retire it for breeding, or sell it.
  • Set goals for your horses’ retirement. Owners are responsible for overseeing thoroughbred retirement, which should be taken into account when buying the horse.

Make Wise Business Choices

  • Make distinct bank accounts for every facet of your horse business.
  • Keep accurate and up-to-date financial records.
  • Hire qualified consultants when their services are needed.
  • Keeping detailed records of all your horse business-related meetings, phone calls, stable visits, sales attended, inspections, farm visits, travel time, and other events is important. Make a note of the occasion’s time, place, and date.
  • Keep copies of all invoices and receipts pertaining to your business.

Whether you are new to the game, experiencing more losses than wins or just looking for a new approach, I am confident that I can help you breed or buy a better racehorse. To find out more about OPTIMAL Matings and how they can help your program, please subscribe to my Blog/News page HERE to receive future information on complimentary mating recommendations, sales short lists, stakes winner pedigree analysis, news on personal client success and any other random thoughts or ideas that I may have. Also, receive a complimentary copy of my report “Blind Luck or Designed Luck? – How A Kentucky Derby Winner Was Bred” sent directly to your inbox.

For inquiries or more information about Shepherd Equine Advisers, please contact Clark Shepherd at 859-321-6618, or by email at

I would love to hear any comments or questions that you may have. Please submit them below. Maybe we can address them in a future post!

I offer my expertise as a bloodstock agent, sales consultant, and pedigree analyst to assist in breeding or purchasing superior thoroughbred racehorses through sound pedigree principles, horsemanship, and consistent implementation of well-designed plans. To find out more about how my services can help your program, please contact me at 859-321-6618, or by email at

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