By Ray Paulick
Tell me if you’ve heard this one before: Wealthy individual who was extremely successful in other businesses and has a passion for Thoroughbred racing and breeding wants to buy a racetrack and incorporate his unique ideas to help bring the sport back to its glory days.
That description could easily fit Frank Stronach, the Canadian auto parts mogul who thought he had a better idea for racing, and a decade ago started buying racetracks like Santa Anita Park, Gulfstream Park and Pimlico, among others. Stronach walked in to the business with the thought that he could make racing more entertaining and accessible to greater numbers of people. He added upscale restaurants and bars to some of his tracks, rebuilt Gulfstream Park and tried new promotions and betting gimmicks, most of which have failed.
Stronach’s arrival was widely hailed because he brought "outside of the box" thinking to a declining sport steeped in tradition. But he is not a great listener, insisting on pushing ideas and programs that simply made no sense and getting rid of executives who don’t see things his way. His racetrack business has been a disaster, with publicly traded Magna Entertainment’s share price a small fraction of what it was at the company’s outset and many industry watchers worried that a possible bankruptcy would endanger some of the sport’s most important tracks.
The above description also fits Halsey Minor, a Virginian in his mid-40s who made a fortune on the Internet, first with the tech news and product review Web site CNET.com and later with other technology companies that I can’t begin to understand or explain.
Minor, a lifelong horse racing enthusiast, also has a growing racing and breeding operation, and he’s interested in building his own racetrack or buying Hialeah and restoring it to prominence while applying his own "outside of the box" ideas.
His interest in Hialeah has made him a mini-celebrity in the Thoroughbred business in the last two weeks, but his business savvy has been closely chronicled for years in the technology and media world.
Here’s what BusinessWeek said of Minor in 2005: "Few serial entrepreneurs have had as much success — and patience — as Halsey Minor. Two years before Netscape even made Web browsing popular, Minor founded CNET Networks."
In other words, Minor had the vision to see what was coming before nearly anyone else did. He admitted as much in the BusinessWeek interview: "Yeah, I have a bad habit of being way ahead of markets," he said. "I had 12 employees at CNET before Netscape was started. We started in 1993 and waited through two years of doing nothing to wait for the market to catch up with the vision."
Minor has been focusing that same vision on the Thoroughbred industry recently after dipping his toes in the water earlier this decade. Seven or eight years ago, when I was editor of Bloodhorse magazine, I got a phone call out of the blue from someone who asked if I would have dinner with an industry newcomer named Halsey Minor, who was thinking of making a substantial investment in bloodstock and wanted to pick the brains of several people. He walked away from that dinner thinking the industry was not in the best of health, and he was right.
A couple of years later, I heard from Minor again. This time, he said he’d been working on a project that he thought could really help the sport, the National Horse Racing League, which would be modeled after professional sports leagues, with franchises of racing stables in 10 different cities across the country. The proposal, frankly, seemed a bit wacky to me, but in the interest of promoting ideas and stimulating dialogue to move the sport forward I eagerly published Minor’s article in the April 12, 2003, issue of Bloodhorse.
In the piece, Minor talked about being a fan of racing as a child and how he came to study the sport after selling his interest in CNET and stepping down from active management of the company. He read Laura Hillenbrand’s best-seller, Seabiscuit, and then consumed himself with old newspaper clippings to help understand what made racing so appealing in the 1930s, ’40s and ’50s. Minor saw racing currently having an identity crisis: Is it sport or gambling?
His conclusion then and now is that racing needs to be rebuilt as a sport.
"Time and again, television ratings, sponsorship, and even gaming revenues have proven to be the inevitable by-products of a sport that is successful in delivering a large and consistent live audience," Minor wrote in that 2003 article. "For example, whereas millions of dollars are wagered annually on the NCAA basketball tournament and the Super Bowl, neither the NCAA nor the NFL has ever presented its products as gambling opportunities. Rather, both are enjoyed first and foremost on an emotional level. Often, many of these fans subsequently choose to personally up the ante with a wager, thus having both an emotional and financial investment in the outcome."
Not surprisingly, Minor’s National Horse Racing League fell on the deaf ears of industry leaders, including board members of the Thoroughbred Owners and Breeders Association who were pushing their own racing series concept, the Thoroughbred Championship Tour, which ultimately failed.
"I was appalled by the condition of the industry (when proposing the league)," Minor told the Paulick Report. "And that was back when Stronach’s (Magna) stock was actually above a dollar. TOBA had this other crazy idea, the TCT, which was massively complex and had no chance of ever working. It effectively stopped any possibility of me doing anything. I talked with the TOBA guys, including Reynolds Bell, and they looked at me like I was competitive. I said, ‘Guys, I have better things in my life to do than start a league. I am just trying to find a way to create a few more big days in the sport, because it’s not going in the right direction."
Minor went back to work, creating new, successful technology companies and planning construction of a luxury hotel in downtown Charlottesville, Va.
But with a mother and sister who rode hunters and jumpers, Minor couldn’t get horses out of his blood. He began buying broodmares in the $400,000 range, then spent $3.3 million last fall at the Keeneland November breeding stock sale to purchase the Grade 1 winner Dream Rush. Last December, he bought the historic Carter’s Grove Plantation in the Hampton Roads region of Virginia for $15.3 million, and made plans to transform it into his breeding base and residence. But he still had an itch to do more than just breed and own racehorses.
"The whole time I was obsessing over the gradual demise of Thoroughbred racing in America," Minor said. "I spend half my time in San Francisco, where there was once a track that is now buildings. I’m a businessperson, and I saw the inevitability of the dirt under the tracks being worth more than the businesses on top of them."
Minor understands that many others have been trying to address the industry’s problems. "There are all these people who have really high IQs, but somehow they all add up to zero," he said. "How else can you explain some of what’s happened. We are the only sport that allows gambling, and we can’t make it work. It’s extraordinary."
Quietly, Minor began looking at the possibility of building his own racetrack. "I’ve made enough money to live my life and pursue my passion," he said. He was he was "moving on a land deal" earlier this year when the idea of buying and restoring Hialeah came up. He contacted Alex Fuentes, who has singlehandedly tried to keep Hialeah Park alive and operates the www.savehialeahpark.com Web site."Alex has done an extraordinary job of protecting that piece of land," Minor said.
Having his own racetrack, Minor said, allows him to follow his beliefs on what the sport needs to do in order to thrive.
"Nobody can stop me from creating the experience," he said. "I tried it the other way, and it didn’t work. The industry is about control. That’s why when I came up with an idea back in 2003 I was immediately met with a competing idea that made no sense. It was purely control. ‘We’ve got to do something ourselves because I don’t want him to do something because we may lose control,’ No matter what you do, there are people who are going to fear that you will somehow take away control from them. That’s why you can’t work with the institutions inside the business. I can’t point my finger at any one group and say they are responsible. But collectively, it doesn’t work.
"The only way I can get away from this control-driven industry, the closest I can come to a clean slate, is having my own track."
Minor had a hard time getting Brunetti to return his phone calls, but when the publicity about his interest in Hialeah started to flow the two men talked. Another meeting is planned in the next week."I hope there is a rational solution that can be worked out that helps everybody," Minor said.
If he can succeed in convincing Hialeah’s owner, John Brunetti, to sell the shuttered racetrack, Minor is ready to roll, though he knows it will take up to three years to renovate the grandstand and replace the barns that were demolished in the stable area. "I’ve got everything going," he said. "I’ve got the best historic architect in South Florida who’s been through it and knows the place. I’ve got people building a business plan, lawyers researching getting a racing license. I’ve got a full-on operational plan."
His focus, when he opens Hialeah or ends up buildling his own track, is simple. "The number one thing I’m going to do is work on putting fans in the stands. Everything I do is going to be designed to make the day more interesting. The day’s got to be shorter and faster. You’ve got to find ways to help people figure out how to bet and without looking at complicated forms."
Minor understands the importance of racing’s hard-core veteran horseplayers, too. "I’ll build a room for them, give them lots of monitors, interest access, make it comfortable for them to bet."
But the base needs to be expanded, he said.
"At CNET I was able to generate 100-million-plus people and get them to show up by offering something they wanted. I want to bring the same type of perceptive, audience building to racing."
Minor concedes he could fail. "I have a friend who is building rockets to put satellites into space more cheaply," he said. "He may lose $200 million or transform the aerospace industry. It looks now like he’s going to transform the industry. I’m willing to take the risk financially, personally, because the reward is worth it. If we took the most iconic track in America and brought it back to how it looked in its best day, and be innovative in the way we treat the fans and help them develop long-lived rooting interest, that’s worth the risk.
"I know Mr. Brunetti originally bought Hialeah to save it, and I can only hope he’s willing to give me a chance to finish that mission."
Copyright © 2008, The Paulick Report
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