April 13, 2024

BALTIMORE — The Pimlico Race Course winner’s circle is a grassy, hedge-lined ring near the finish line where, on the third Saturday of each May, the new Preakness champion, draped in a blanket of black-eyed Susans, is paraded past TV cameras and VIPs to be met by his jubilant connections. Typically the milieu of white-haired owners and rosy-cheeked grandchildren, the circle also hosts the occasional dignitary, from princes of Saudi Arabia to sitting governors of Maryland to — 50 years ago this week — Secretariat himself.

But if a certain chestnut colt should win the Preakness Stakes on Saturday, thus securing the second leg of horse racing’s Triple Crown, the scene in the winner’s circle could be unlike any in the century-and-a-half history of this race — with the gathering of millionaires and grizzled horsemen likely to be infiltrated by dozens of raucous, 30-something newbies whose ownership micro-shares in the horse known as Mage were obtained for as little $50.

In other words, it would be not at all unlike the scene that unfolded two weeks earlier at Churchill Downs — where Mage, a lightly raced 15-1 shot with a charming backstory and an unusual ownership structure, outran 17 rivals to win the Kentucky Derby. In the chaos of the winner’s circle, when they finally lined up everyone who owned a piece of Mage, the photographers shooting the traditional victory photo may have had to switch to a wider lens.

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“It looked like the cover of ‘Sgt. Pepper’s,’ ” joked Ramiro Restrepo, one of Mage’s controlling owners, speaking of the resulting photo, with its teeming horde of cocktail-toting, ballcap-wearing investor bros, who numbered more than 100. (In reality, the collage on the front of the Beatles’ “Sgt. Pepper’s Lonely Hearts Club Band” contains far fewer faces.)

It is true, however, that Mage — a true champion of the people, in the most literal sense possible — is the closest thing horse racing has to a rock star at the moment and the best shot at a redemptive storyline for a beleaguered sport that sometimes appears to be on the verge of collapsing under the weight of equine deaths and doping scandals. Such as the ones that occurred in the run-up and aftermath of the Derby.

“That’s why I say Mage was like a gift from above,” said Brian Doxtator, co-founder and CEO of Commonwealth Racing, the “fractional investment platform” that, along with 391 micro-investors who bought in via its app, owns 25 percent of Mage. “The timing of it for our business, our customers and for horse racing couldn’t be better. And horse racing did need this. … I do think we’re putting a slightly different lens over horse racing. And it is at a critical juncture for the industry at this moment.”

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There is a ragtag, underdog charm with almost all of Mage’s human connections: His jockey, Javier Castellano, snapped a career 0-for-15 Derby skid with the win. His trainer and co-owner, Gustavo Delgado Sr., is a legendary horseman in his native Venezuela, where he won that country’s version of the Triple Crown four times, but had never finished better than 12th in two previous tries in the Derby. Co-owner Restrepo is a gregarious, fifth-generation horseman with Colombian roots and a knack for blowing past his budget.

“One heck of a melting pot,” Restrepo said of Mage’s collective connections following the Derby win.

It was only a year ago this week that Restrepo and Gustavo Delgado Jr. — the trainer’s son and assistant — first laid eyes on Mage at an auction of 2-year-olds that took place at the Timonium Fairgrounds, just a few miles up Interstate 83 from Pimlico. Told by Delgado Sr. not to exceed the budget of $100,000, Restrepo and Delgado Jr. decided they could probably go to $200,000 if they needed to — then stayed in the bidding for the horse they desperately wanted until they finally got him for $290,000.

That horse, from the first crop sired by 2018 Kentucky Derby runner-up Good Magic, out of the Big Brown mare Puca, was Mage. Though the purchase barely caused a ripple across the industry at the time — 25 horses fetched higher prices at that auction, including one, Hejazi, that went for $3.55 million — it would change the course of history.

“It was intuition. We had to have him,” Delgado Jr. said. “I told Ramiro, we’re going to go after him, and then we’ll figure out where the money was going to come from.”

That budgetary overreach — and the financial scrambling that followed — is what led the cash-strapped new owners of Mage, several weeks later, to Commonwealth, a 2019 start-up in the fractional investing space that had had a massive breakthrough in 2022, when its horse Country Grammer won the $12 million Dubai World Cup.

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Once Doxtator and Commonwealth partner Chase Chamberlin agreed to go in on a quarter of the horse — plus their share of two years of annual training expenses — it was time to offer him to the app’s users, who numbered around 6,500 at the time. Shares were $50 each, and while shareholders could profit from both race earnings and eventually stud fees, anyone who knows anything about horse racing understands many more investments turn into duds than turn into Kentucky Derby winners.

But Commonwealth sees its mission less as a microinvesting tool than as a community-builder. It sells an experience as much as it does a racehorse. Because its investors had owner status, they could visit the paddock before races and — should everything break just right — the winner’s circle afterward.

“People focus on the financials, but what we’re actually trying to do is build a community of sports fan — I call them the ‘big day out’ crowd,” Doxtator said. “These are people that invite five of their friends to the track or to a golf tournament. Or these are music festival-goers. These are people who are accustomed to [bringing along] four or five of their friends. They don’t just go do it themselves. … We get $50 shareholders in the paddock all the time. I hear them say all the time, ‘You can’t do anything like this for 50 bucks.’ ”

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When Mage’s offering went live on the Commonwealth app in January, it took just 48 hours for shares to sell out. Three hundred ninety-one users bought in, with investments ranging from $50 to $20,000. More than 100 of those Commonwealth investors traveled to the Derby, with seats scattered all around Churchill Downs.

“We told them going in, ‘We can’t make any guarantees [about access].’ First of all, this was our first Kentucky Derby, too,” Doxtator said. “We didn’t know how it was going to work.”

In the wild aftermath of Mage’s improbable win, the Commonwealth crowd — distinguished by white “Mage” caps — converged upon the winner’s circle, initially overwhelming the security personnel. “There’s all these people pouring in,” Doxtator recalled. “I think the [security guards] were finally like, ‘Okay, if they have the hat on, we’ll let them in.’ ”

A bunch of the delirious Commonwealth users — some of whom, and this simply can’t be reiterated enough times, bought in for just 50 measly bucks — lingered in the winner’s circle long enough to take turns kissing the trophy.

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Thanks in large part to a brief mention on NBC’s telecast of the Derby, Commonwealth saw more than 6,000 new users sign up in the first 48 hours afterward. Doxtator, 40, and Chamberlin, 32 — childhood friends from Kalamazoo, Mich. — fielded so many media inquiries, they enlisted another friend to help them out as a PR contact. Among the many industry calls they fielded were some from agents from the worlds of golf and tennis: In the coming months, Commonwealth plans to branch into those sports, with PGA Tour rookies Joey Vrzich and Cooper Dossey having already signed on.

Commonwealth wasn’t the first company to offer micro-shares of a racehorse or even the first to win the Kentucky Derby; MyRacehorse had a piece of 2020 champion Authentic. But perhaps because of their youth and their backgrounds in tech start-ups, Doxtator and Chamberlin have found a foothold with a younger, more tech-savvy crowd; Doxtator said the average age of a Commonwealth user is 36, decades younger than the average thoroughbred owner, and a new user can go from downloading the app to buying a share in about 90 seconds.

And while the minimum cost for a share of Authentic through MyRacehorse was $206, Commonwealth made sure to aim lower with Mage.

“We’re trying to democratize this sport,” Doxtator said.

Across the embattled industry, people have taken notice. Dalmore Group, the broker-dealer through which Commonwealth offers its investments, said in a statement that Mage’s Derby win “sent ripples through the horse racing community.”

“This democratization of the sport has the potential to make horse racing more inclusive,” Dalmore said. “Mage’s victory in the Kentucky Derby is a testament to the power of fractional ownership and its potential to revolutionize the horse racing industry. … The sport of kings is no longer reserved for just a privileged few.”

Meanwhile, for the 391 Commonwealth users who bought in to Mage, the Derby win resulted in a $95 payout for each $50 they invested — on top of their initial investment — which is still far less than what that same $50 would have gotten them at the betting window, where a $2 win bet returned $32.42. But based on the stallion offers Commonwealth is already fielding for Mage once his racing career is over, Doxtator estimates those $50 shares will eventually be worth at least $500 each.

And anyway, the money is only a small part of the draw. Watching a horse — your horse — charge to the finish line in front of the pack, then making your way down to the winner’s circle to celebrate another jewel in the Triple Crown and kiss another trophy? Whether you’re in for a gazillion or just 50 bucks — such a thing would be priceless.