- The Basics
- Buying Shares
- Horse Ownership
Can I really make money by investing in a racehorse?
Yes! Your horse company is a for-profit entity. If the horse is ultimately profitable—which is measured against the cost of purchasing the horse, training, and maintenance, and other costs associated with operating the horse series company—you can expect to receive a dividend. Of course, there’s no guarantee that the horse will turn out to be profitable and in many cases horses are not profitable.
What are the risks of buying a micro share?
Horses are living, breathing, fragile animals and no guarantees can ever be made about the outcome of an investment in a racehorse. Most investments lose money, some break even, a few are profitable, and a select few are extremely profitable. We are here to provide a marketplace to make investing safe, secure and fun, but we are not removing the risk from racehorse ownership.
What are the benefits of buying a micro share?
Our goal is to enrich the horse racing experience for each investor. In addition to having an equity interest in the horse, we offer regular updates on how your horse is doing, free backside tours, farm tours, and events during morning workouts so you can watch your horse and chat with the trainer. When the horse races you can gain access to the Winner’s Circle and enter a raffle for paddock access. We also have premium (paid) events on race day including owner-exclusive parties.
What does it mean to “Indicate Interest”?
When you click the Indicate Interest button, you’ll be added to our earlybird mailing list. Once the listing is available, you’ll receive an email so you can purchase your shares before it launches to the public. Some horses sell out very quickly, and may even sell out before they have a chance to go public, so we encourage you to use this feature.
Who can buy shares?
Anyone over the age of 18 from a qualifying jurisdiction can purchase shares, as long as their investments do not exceed 10% of their annual income or 10% of total assets. We currently have horses available to both domestic and international residents, but there are a few US State restrictions which will be mentioned on the horse’s offering page.
Do you accept residents outside of California?
Yes. When we first launched in 2018 we were working under a California Permit, so we could only accept California residents at the time. Now that we’re operating under a Regulation A exemption, we can accept users from all across the US (a few state restrictions may apply) and International markets.
How many shares can I buy?
There is no minimum and the maximum is 10% of your annual income or total assets.
Do I need to pay any additional fees after the initial purchase?
No, there are no out of pocket expenses after your initial purchase. The price of a share includes a prepaid amount for the care and training of the horse. In order to ensure the training and maintenance account maintains sufficient reserves race earnings are used to top off the account. In the event additional funds do need to be raised, MyRacehorse will have the option of issuing additional shares at whatever the market price is at that time.
Can I buy shares for someone else?
Due to securities regulations, shares cannot be purchased for other people, however MyRacehorse does offer gift cards that you can buy for someone else.
Can I sell the shares?
Currently, shares cannot be resold. We might change this in the future.
What are MyRacehorse’s fees on each listing?
There are never any mark-ups on the horse or their expenses, you pay exactly what we pay. There is a separate one time 15% diligence fee on a closed offering and a 10% fee of gross earnings that covers the ongoing management of the series.
What is a Premium Share?
Instead of our regular 0.1%, Premium Shares are 5% interest in a horse. As a Premium Shareholder, you will be given extra perks, like a private barn tour, a MyRacehorse gift box, a commemorative gift from the horse, and guaranteed paddock and winner’s circle passes every time they are distributed (no need to enter the lottery) and more. Get all the details from our premium share overview page.
What type of ownership stake am I buying?
You are buying a stock in a particular series of an LLC that has been validly issued in compliance with applicable securities laws. We establish a series for each horse offered, and stock in that series is what’s being sold.
Are these real shares? Who is the regulating agency for them?
These are genuine shares issued either under a state permit or through a Regulation A offering.
Why doesn’t MRH own 100% of any horses listed?
Our goal is to provide fans the opportunity to partner with established ownership groups,with a proven track record for success, hence our commitment to only own a percentage of the horse (5-60%). The MRH percentage is listed on the individual horse listings page.
Am I buying shares in MyRacehorse?
No. MyRacehorse is a manager of the horse companies and handles the offerings. Experiential Squared, Inc. DBA MyRacehorse itself is a separate company from the horse companies.
Do I get a K-1 or 1099 if there are dividends or profits?
If your horse pays dividends you’ll get a 1099. The intent is for these investment price points to be within reach of the average person – true crowdfunding of racehorses. To ease the tax filing burden, the horse series will issue 1099s.
How are horses selected?
All horses that list on MyRacehorse must undergo an exhaustive diligence process, that includes a veterinarian check, conformation assessment, and value assessment that includes pedigree analysis, race history, remaining conditions, and several other factors that determine the fair market value of a horse. Horses that meet the vet, conformation and value assessment are eligible to be listed on MyRacehorse. However exhaustive our diligence process is, no guarantees can be made in terms of how successful they will be on the race track. Our goal is to use the best practices, partner with credible horsemen, and be rigorous with our diligence/assessments, but there will always be an element of risk.
How often will I get updates about my horse?
We strive to provide updates every week, but some horses will update more or less frequently. Ultimately, it depends on the horse’s trainer and ownership group.
Can I visit my horse in the barn area?
Yes, but you must be accompanied by a MyRacehorse Owner Concierge. Escorted tours are posted in the app, and are a first come first serve basis. Our terms and conditions with the trainers, tracks and partners, require all microshare investors to be accompanied by a MRH Concierge, so you’ll need an escort regardless of whether you have a state owner license or not.
What is a paddock pass lottery?
For each horse, we have a select number of passes to provide access to the paddock ring prior to the race. We distribute those passes among a horse’s shareholders via a lottery. You may enter for yourself, or yourself and one guest. Each share that you own of a specific horse entitles you to one entry into the lottery. You only need to enter once, our system will count your shares and make the appropriate number of entries. All entrants are notified of the results the evening before the race with the instructions for the winners on how to receive their credentials.
Do owners get access to the Winner’s Circle?
Yes. Tracks have been extremely supportive of MyRacehorse and in more than 90% of our races we have been granted an UNLIMITED number of Winner’s Circle credentials. When you enter a Paddock Lottery, you are automatically being entered into a Winner’s Circle Lottery. In most cases all entrants will be provided Winner’s Circle credentials. In the case that a finite number of credentials are available, winners will be notified the night before.
Where will the horses be based?
Each horse listing will specify the circuit that the managing partner intends to race the horse at. Plans can change over time, and it may be necessary to move the horse to another circuit.
Who determines when and where the horses run?
The racing manager and the co-ownership group have the decision making authority as outlined in the co-ownership agreement for each horse.
Do I get a say in how the horse is managed?
Micro shareholders do not have any say in how the horse is managed. At present, the stakes are minority participants in the larger horse ownership group, and the intent is for the Racing Manager and the Co-Ownership group to make decisions regarding the horse.
Do I have to become a registered owner?
Investments made in micro-shares do not make an individual eligible for an owner’s license.
Does MyRacehorse play a role in the aftercare for racehorses?
MyRacehorse has teamed up with the Thoroughbred AfterCare Alliance to aid in the ongoing commitment to the wellbeing of thoroughbreds after racing. For every share purchased on the platform, MyRacehorse makes a donation to the TAA.