Taking Stock: Kumin's Partnerships Are In Plain Sight

If it wasn't obvious before, it should be now. Since appearing on the scene four-plus years ago, Sol Kumin's various racing partnerships–notably Head of Plains Partners, Madaket Stables, Monomoy Stables, and Sheep Pond Partners–have become ubiquitous on weekends and astonishingly successful at the highest levels. All told, the Kumin entities have won 38 Grade l races to date. This year has been particularly fruitful, with 10 individual winners of 16 Grade I races, including the Triple Crown, Kentucky Oaks, and Coaching Club American Oaks, with plenty of racing still to come.

Last year there was some controversy surrounding Kumin and the Eclipse Award for leading owner. A letter to voters from one of his associates making a case for Kumin left a bad taste for some; others pled ignorance that they didn't know about Kumin's accomplishments; and more belittled him for his fractional interests in many horses under various noms-de-course instead of full ownership under one name. Partnerships, however, are standard fare these days–even racetracks are forming them as “clubs”–so pleading ignorance in 2018 won't cut it given the year Kumin's having.

Kumin is a smart guy who attended the exclusive St. Paul's School in Concord, N.H., before college at Johns Hopkins University in Baltimore, Md. Now in his early 40s and based in Boston, Kumin has had a successful career in the hedge fund world and most recently headed Folger Hill Asset Management, which was sold a few months ago to Schonfeld Strategic Advisors. After Labor Day, Kumin will begin work at another firm, Leucadia Asset Management, as its chief strategic officer, he said when I reached him by phone this week in Lake George, where he was spending some downtime with his kids.

“Yeah, we basically just sold [Folger Hill],” Kumin continued. “We did a deal with Schonfeld. Leucadia was my partner, and they owned basically half of my business with me, and we merged the firm into a bigger firm where they are going to own 60% and we're going to own 40%, and then they'll run it and I'm going to work as the head of strategy.”

Strategy

Kumin's strategy in racing is to buy, merge, or hedge with other partners or principals, and then sell, a philosophy that has been cultivated and honed from his background in hedge funds and equity markets, where bottom-line returns drive growth. This is essential to his partnerships, and he follows a strict and analytical business plan and calls the shots to keep partnerships profitable–which they have been, he said. But this isn't mutually exclusive from the thrills he gets from participating in racing, a sport that he thoroughly embraces and enjoys, which is evident to anyone who's seen him at a racetrack with his wife, kids, partners, and friends. From afar, he's the ebullient guy in the crowd, and why not? He wins an awful lot of stakes races–more than 100 over the last few years, according to Brad Weisbord of BSW Bloodstock, which manages Kumin's operation.

His various partnerships–formed “mostly with the same two or three good friends”–own interests in about 100 horses at any given time, of which 70 to 75% are fillies, he said. “We try to stay at around 100, that's our number. We're at 102 right now. Remember, 100 for us is really 50, because we own about an average of half the horse. So the way we sort of look at it from a business standpoint, if we have about 100, then we have bills on about 50, which is kind of $2.5 million in purses a year [required to cover operating costs]. We've done much better than that, but that's just the kind of top-down quick math that we do when we think about it.”

The strategy of buying fillies is straightforward: add black type to their resumes while picking up purse monies and then cash out at the sales when they are finished racing. Young black-type fillies off the track, especially the graded winners, are particularly sought after in the auction marketplace, as are the graded winners carrying their first foals. Grade l winner Lady Eli (Divine Park), named after Kumin's wife, got the ball rolling for Sheep Pond and later became an emotional attachment for her owner during her well-publicized bout with laminitis. She stands to become a massive score after she goes through the ring this fall in foal to War Front.

“We bought 100% of Lady Eli for $160,000 [at the 2014 Keeneland April 2-Year-Olds-In-Training sale], and then she made whatever it was, $3 million at the track, and she's going to sell in November in foal to War Front for what? I don't know, $5 million, $6 million, $7 million, right?”

Monomoy Girl (Tapizar) is another home run, this time for Monomoy Stables, which owns her with three other entities. Like Lady Eli, she was bought at auction, as a yearling for $100,000 at the Keeneland September sale in 2016. The leading 3-year-old filly of her crop, Monomoy Girl has won eight of nine starts, earning $1,660,750 to date. Among her four Grade l wins are the Kentucky Oaks and the Coaching Club American Oaks. When Monomoy Girl is eventually sold at auction, she will bring a premium, and even more if she has an Eclipse Award on her resume.

Kumin said that about 30% of the stock he buys is “unproven” like Lady Eli and Monomoy Girl, but he has strict limits on what he will spend on a yearling or 2-year-old, and that figure boils down to an average price of $100,000 per horse. For auction purchases, Kumin said he principally now uses Liz Crow of BSW Bloodstock, who signed for Monomoy Girl; Gatewood Bell; and Keith Desormeaux. He noted that My Boy Jack (Creative Cause), winner of the GIII Southwest S. at Oaklawn, the GIII Lexington S. at Keeneland, and fifth in the Kentucky Derby, was purchased at the same 2016 Keeneland September sale as Monomoy Girl, for a bargain $20,000. He has earned $729,445 so far–the bulk of that for Monomoy and Don't Tell My Wife Stables before a 30% interest in the colt was sold at a premium to West Point Stables leading up to the Kentucky Derby.

Made horses and making trainers

Kumin, who doesn't have a background in the game, spends hours a day studying past performances, speed figures, and both domestic and foreign race replays because he sources mostly made horses from around the world, but he said that of his 38 Grade I wins divided among 21 individual horses, none was a top-level winner when he bought it. In fact, the only GI winner he's bought into is 3-year-old filly Midnight Bisou (Midnight Lute), a rival of Monomoy Girl, but she's yet to win at the highest level for him. Some of his GI winners have been available in plain sight for relatively cheap money. He noted as an example the 7-year-old horse Long On Value (Value Plus), a GI-placed stakes winner who was purchased at the Keeneland November sale last year from Weisbord's ELiTE consignment for $100,000. Racing for Head of Plains Partners and two other ownership entities, the horse won the GI Highlander S. at Woodbine at the end of June for trainer Brad Cox, who won his first career Grade I race earlier this spring with Monomoy Girl in the Ashland at Keeneland.

“I told the guy I would buy him his first Grade I winner this year,” Kumin said of Cox, who now has five Grade I wins, four with the filly and one with Long On Value. That's something that makes Kumin proud, and there's some basis for it that stems from outside of racing. Kumin was an athlete at both St. Paul's School and Johns Hopkins, and in 2010 he and his wife established an endowment, “The Sol and Elizabeth Kumin Fund in Honor of Great Coaches,” at St. Paul's specifically to “support coaches in their professional development and to assist coaches in their recruiting efforts.”

Kumin's doing that in racing. He's been supporting talented young trainers like Cox; Leonard Powell, trainer of GI Del Mar Oaks winner Fatale Bere (Fr) (Pedro the Great) for Head of Plains Partners and three other owners; and Jonathan Thomas, who has GI winner Catholic Boy (More Than Ready) entered in this weekend's Travers S. for Madaket Stables and three separate owners. “One of the things I'm most proud of is that we won a Grade I with Leonard Powell in California last weekend. First Grade I he's ever won. To be part of that is special. Jonathan Thomas with Catholic Boy [in the GI Belmont Derby]. First Grade I win for a young trainer. To be part of that was special. There's nothing better than to be a part of a horse with some of these trainers that had never won that first Grade I. Seeing Brad cry after the Ashland. Giving Jonathan Thomas a hug. Those are things I'll never forget. Honestly, it's better than winning the Triple Crown. Sounds crazy, but it is.”

The Triple Crown

In 2016, Head of Plains Partners was a co-owner of Preakness winner Exaggerator (Curlin), an experience that whetted Kumin's appetite for the classics, which is all about the pomp and pageantry of the sport–something that's appealing to Kumin and his pals in his partnerships. In the case of Exaggerator, the financial rewards weren't bad, either. “Exaggerator, we sold for $10 million, that was big,” Kumin said. He owns one share in the stallion and did use it this year on a mare that his son is attached to, but breeding in general is not a part of Kumin's portfolio, though he does own several shares in Central Kentucky stallions, including Violence (Medaglia d'Oro) and Creative Cause (Giant's Causeway), as investment vehicles. Creative Cause, of course, is the sire of My Boy Jack, and that colt's run through the Triple Crown trail prompted Kumin and Weisbord to speculatively acquire 10 shares in the stallion for Kumin and Weisbord's clients.

In 2018, Kumin bought into several Classics contenders, including eventual Triple Crown winner Justify after his maiden win. He is, however, pragmatic in his approach to buying into colts for the Classics.

“We're buying mostly fillies, [but] every year we're going to take a shot or a few shots at a Derby horse where we know, okay, if we lose 'x,' that's what we're willing to lose within our portfolio to kind of have the action,” he said. “But we're pretty analytical about it. This year, for example, we took basically three shots; we really wanted to take two. We loved Justify before he ran. We went to do the deal and they would only do the deal if we bought Audible with him. We didn't love Audible and we turned out to be probably wrong. He was better than we thought, and we won the Florida Derby. The other bet we made was Catholic Boy. He turned out not to work for the Derby but he's running in the Travers.”

Head of Plains Partners purchased a minority interest in the racing rights of Justify and Audible. Kumin said the deal was a financial success, but he also noted that the historic experience of being a part of a Triple Crown winner would have been worth the cost of participation even had he lost money on the deal.

Kumin's bottom line is black because he and his team, which includes a phalanx of trainers, including some of the top names in the game, are sharp evaluators, developers, and managers of talent who know where to source talent and where best to run horses for maximum effect. Moreover, Kumin's understanding of buy and sell price points and financial management gives his partnership entities a discipline rarely seen in racing, which makes his operation quite significant.

The Grade I wins are proof of this, and he should be acknowledged for it.

Sid Fernando is president and CEO of Werk Thoroughbred Consultants, Inc., originator of the Werk Nick Rating and eNicks.