John Malloy owns a minimal piece of Max Player, but his pleasure is undiminished by the size of his stake.
His horse is headed to the Kentucky Derby.
“I feel as excited as the people who stand in the winner’s circle,” Malloy said Wednesday afternoon. “For so many people, horse race ownership seems like a foreign entity. It’s a game for the big boys and the powerful rich. It’s usually not a possibility for people like us.”
A St. Louis resident of admittedly modest means, Malloy paid $1,000 for the 10-share minimum in a January public offering that included a fractional interest in Max Player, a 3-year-old colt who has since run third behind Derby favorite Tiz the Law in both the Belmont and Travers Stakes.
Given those performances, a recent switch to Hall of Fame trainer Steve Asmussen and the possibility of an eventual career at stud, Max Player may ultimately prove to be a profitable plunge for the many small players along for the ride.
Kentucky Derby notebook: Max Player breezes for new trainer Steve Asmussen
“I know the valuation since I got involved has gone up dramatically,” said San Francisco investor Kevin O’Regan. “If he runs well in the Derby, the valuation is going to be skyrocket.”
With bloodlines that can be traced to Triple Crown winners Secretariat and Seattle Slew, Max Player was appraised at $1.75 million by Bradley Thoroughbreds following his Feb. 1 victory in the Grade 3 Withers Stakes. His sire, Honor Code, produced 128 live foals last year at a published rate of $40,000 (since reduced to $30,000).
Yet with much less than a 1% interest in Max Player, the 44-year-old Malloy says he is not in it for the bucks, but “the buzz.” Should Max Player win the Derby — and USRacing.com makes him a 45-1 shot — Malloy said, “I will be as thrilled as any sports moment in my life.”
That, in essence, is the idea behind SportBLX, a company George Hall co-founded as a means of monetizing horses he continues to control while luring new investors to thoroughbred racing. He’s selling excitement while promising no monetary payoffs.
“We would never pitch anything in horse racing as a money-making proposition,” Hall said. “We don’t want investors to think this is an investment that is going to make them a lot of money. It’s an investment that would be really interesting and entertaining for people, just as it is for any owner and any investor at any level.”
In a business where it’s easy to make a small fortune by starting out with a large fortune, the opportunity to reduce risk, raise cash and attract prospective buyers has broad appeal.
Also: Everything you need to know about placing a virtual bet at the 2020 Kentucky Derby
“I know there are lots of owners who would potentially like to see some liquidity in horses, but not sell the whole horse,” Hall said. “If they had a certain amount of capital to invest, they might be able to invest in more horses.”
BLXSport’s current offering includes another piece of Max Player and is priced at $103 a share through Derby Day, Sept. 5. Alternatively, investors can still purchase a 0.001% interest in Bob Baffert’s Derby-bound Authentic for $206 through MyRacehorse.com. The Churchill Downs Racing Club offers entry-level ownership of horses trained by Brad Cox and Tommy Drury for $500.
“I think the gimmick is good,” said thoroughbred consultant Ric Waldman. “When someone says they own a horse, does it matter if it’s ½ of 1% or 10%?
“For somebody who has a regular job and doesn’t have a great deal of money in their bank account and buys a share that is ½ of 1%, relative to that individual that’s a big deal when that horse wins a race.”
To Sareer Fazili, an attorney based in Rochester, New York, owning a small piece of Max Player “is a lot more exciting than owning a share of Apple.”
“It gives you the proverbial skin in the game,” he said.
Kentucky Derby horses: Max Player looks to give Steve Asmussen first Derby victory
Among the privileges of fractional ownership in Max Player is the opportunity to participate in Zoom video calls such as the 35-minute session held Thursday evening. With Churchill Downs closed to the general public for Derby 146, this may be as close to the Twin Spires as some investors are able to get.
“I’ve been involved in horse racing for 30 years and never had a horse go to the Derby,” O’Regan said. “I always said I was not going to go until I had a horse running in it.
“My dream of going to seeing my horse run is not going to happen this year. But it’s just fun to have a horse there and say you’re a part of it.”
Tim Sullivan: 502-582-4650, tsullivan@courier-journal.com; Twitter: @TimSullivan714. Support strong local journalism by subscribing today: courier-journal.com/tims.
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Small investors are savoring Max Player's ride to this year's Kentucky Derby - Courier Journal
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