What inspired you to set up the Alizeti consortium and bid for the Tote?
The opportunity of pool betting is massive – people in the UK underestimate just how much regulation and a changed way of betting will play out. We have a very strong view but ultimately we don’t think [the Tote will be] 4% of the market share; we think there’s a better market share for pool betting that is probably higher single digits, maybe even 10%.
So, there’s that side – which is pure opportunity – but also it’s the most obvious source of racing finance. Media rights are very helpful but, particularly from the owners’ and breeders’ perspective, people are looking at the state of things now and thinking there is a problem. If ever we were going to leave a legacy, this is the chance to do it.
Racing will benefit if the pool is massive and to have aspirations to make the pool massive, you must have ambitious people involved
We felt that there would never be a chance to buy the Tote again so we thought we’d give it a go. It seems to me that the levy is the right principle for returning capital to racing. So, it was a combination of a pretty unique opportunity in a world I understand incredibly well, which is pool trading, and the need for a solution to racing finances.
You have had to raise money from other investors. How easy was that given that your aspiration is not solely a profit-driven one from the investors’ point of view, but one which it is hoped will benefit racing?
People like to see good motives tied to big investments. Frankly, we went to people who could afford it and there was lots of discussion about whether this was purely a charitable cause, but when you approach it in that way, your aspirations are capped immediately.
Racing will benefit if the pool is massive and to have aspirations to make the pool massive, you must have ambitious people involved. To go to people with trading backgrounds and ask them to work for a charity wouldn’t have worked. To me, what seemed much more effective was to combine the two.
Very successful projects across the world have had an underlying good cause but have been privately backed. We paired with investors who ultimately shared the vision of how it could work and felt that if the industry was to get behind it, both sides could be winners.
Everybody involved is locked into a five-year investment with the aim to make sure that the Tote is never sold again outside racing. We’re in talks with various parts of the government and regulatory people across the board to make sure that it stays within racing forever.
In Hong Kong, Australia or almost anywhere you go, the Tote is the origin of how betting happens and it feels to me that in a highly regulated world, where cash is becoming less and less of a feature, credit pool betting is the most palatable option.
The Tote, of which Alizeti owns 25%, is in discussions with Britbet, which is a new player in the pool betting market. Can you speculate as to how two might become one?
Strategically it makes a lot of sense to divide the two in the sense we don’t profess to be experts at running racecourse services. It would be sensible for Britbet to run a pool on course that has the Tote brand, which is widely recognised here and internationally, and for us to provide everything off course, which is a significant portion of the pool. We need to make sure that on course you receive an amazing service.
We’ve also got to deliver other promises, which is to make sure that momentum is coming back into the industry
Historically, there have been complaints that the Tote’s offering on course isn’t very interesting and hasn’t been aggressively marketed. Britbet feel they can improve on it and I believe that they will be able to provide a really good on-course experience.
Tote betting in Ireland has halved on course in recent years, so it’s a massive challenge for everybody, but we’ve got to make sure that the tablet way of betting is really alive. It’s not going to happen overnight but we have people on board who can deliver it.
What plans do you have for encouraging more punters to bet into the Tote?
Liquidity is everything and for that the user experience has to be really good. Some bookmakers have done a great job at making it very easy for people to have a bet on their screens and we have to be one of those.
We’ve also got to deliver other promises, which is to make sure that momentum is coming back into the industry.
If you can have that Camelot-like experience with a bit of Amazon thrown in then you’d really have something people can believe in, and if you’re an owner, or a breeder, or one of the six million people who go racing each year and you see good things happening, then hopefully the whole thing will be self-fulfilling. But we’ve got to aim high.
Ascot, Bangor and Chester all operate their own on-course betting operation. Would you have a tote pool on races at a course where on-course bets are not being paid into your pool?
Ascot has about £9 million in turnover from [general] on-course turnover of around £70 million, so Ascot is a big chunk of what goes on and is very significant. They are already in partnership with the Tote so there shouldn’t be any changes there, though they are one of a few who will use their own brand, which is Ascot Bet.
Currently the relationship between betting and the industry is broken
We’re very keen to work with them on delivering a great on-course experience. We’d love to talk to the other courses as we feel we can offer them a very good service and ensure that the pool is consistently big.
Several prominent racing figures have spoken out in favour of Alizeti’s plans but it’s probably fair to say that the wider racing world doesn’t know much about you. How do you plan to get your message across that betting with the Tote will benefit the sport?
We’re seeing as many people as possible, including a recent presentation to the Racehorse Owners Association. We’ve discussed it with 30 to 40 trainers, 50 or more owners and breeders.
People will look at it from afar and have an opinion, but actually you really do need to do a lot of work to understand the complexity [of the Tote].
The fact that we have got 40 investors to believe in the economics and the cause of what we’re doing hopefully tells its own story.
But we don’t want just to say, ‘Here’s racing’s rich list’. It shouldn’t be about that. Alizeti should disappear very quickly and it should be about the Tote.
What return do you expect from your turnover compared to the return from current betting operators?
Currently the relationship between betting and the sport is very contentious. For a 4% market-share business we think we can contribute meaningfully. We’ll have to invest a lot up front to make that happen so you won’t see crazy numbers spin off in the Tote straight away, but you should in five to ten years’ time.
This is an asset that hasn’t been invested in heavily for a long time. The government had it for sale for six years and since then the attraction was much more in property than the underlying assets.
Currently the relationship between betting and the industry is broken. The levy is going up but it’s going up on fairly fragile grounds.
One of the strengths of overseas totes is that they have popular bets over and above the standard win and place pools. Do you think it will be possible to change people’s betting habits in this country to increase the popularity of the ‘exotics’?
We have to make it fun – with a high return. The Tote Ten to Follow is a massively successful bet and so is the Placepot. The Placepot still holds a strong place in people’s hearts, and the three numbers in the lottery, for example, was very successful – it gave a sense that it’s possible to win.
We’ve all won the Placepot once and it’s great fun, but not if you’re winning £65.20. It has to be much bigger than that. It needs to be kept very simple – make sure it’s six televised races and very mass market.
Who knows, would we ever become a rival to the lottery like the Tiercé is in France? That’s the dream ticket.
How did you first become involved in racing?
My grandfather, Tom Frost, owned the winner of the 1964 Sussex Stakes, Roan Rocket. My dad, who is also called Tom, was successful in his own right on a smaller scale but was much more into the breeding side.
Roan Rocket stood at Dunchurch Stud and we used to go to see him. My dad also had Absalom, another grey sprinter who won the Hungerford, so we were brought up with these horses being around – 54 years on we’re still looking for the next Roan Rocket.
You bought Ladyswood Stud early last year and consigned your first foal draft in December. What ambitions do you have?
We’d like to try to find three or four really strong bloodlines. At the moment we have two – Dabaweyaa’s family, which has been great for us so far, and the Twilight Son family which we’ve had a lot of fun with. We have Henry Candy to thank for that.
He bought [Twilight Son’s half-brother] The Confessor for us and we were intrigued by the fact that, from fairly humble stallions, his dam was producing really tough and fun horses. Then suddenly it went from tough and fun to really good. So by Piccolo she had The Confessor and Music Master and by Kyllachy there was Twilight Son.
The Confessor won five races for us and gave us some brilliant days out. We now have [his half-sister] Spring Fling back here and also her full-sister, and then we have a three-parts sister to Twilight Son in training with Henry Candy called Twilighting.
I love looking into the bloodlines; the first thing I look at when I see a winner is who it’s by, then you start to work out if the mare was a good cross with the stallion.
You also own some National Hunt mares in partnership in Ireland, including the dam of Don Poli. Where does your heart lie, Flat or jumps?
I just find when I get to November Handicap time I like to flip to the jumps and you get that wonderful build up towards the King George. The seasonal aspect of racing in the UK is wonderful.
The moment that Cheltenham, Aintree and Punchestown finish I’m ready for the Flat again.
You’re also on the board at Epsom, which as a Jockey Club Racecourse is involved in Britbet. Has that been contentious?
We have the most incredible chair in Julia Budd and whenever there have been any discussions regarding Britbet she has suggested I stand down for particular items.
But Epsom is hugely enjoyable and it has a wonderful and diverse board of people from all walks of racing, who are very ambitious and very keen to ensure that the Derby is as prominent as it should be, and that Epsom on a Thursday night is as much fun as Windsor on a Monday.
I love looking into the bloodlines; the first thing I look at when I see a winner is who it’s by
There is a concern that racing is becoming increasingly marginalised. What can the sport do to captivate a wider audience?
I’m passionate about kids getting close to horses. It doesn’t matter if it’s Frankel or a pony, there’s just something special about the relationship between horses and humans. We can see that in the interaction between horses and children with learning disabilities.
I love the scheme of the Ebony Horse Club in Brixton. These are the sorts of things we should be encouraging.
In my view, there’s no point going off on a spending spree and trying to recruit 28-year-old blokes who like football. They’re gone, it’s too late.
But it is worth trying to get the five- to 15-year-olds to come and experience the horse, through open days and Racing to School.
It’s up to us as a community to invest in that. There’s a good chance that some of them will get the bug.
When people come racing we should make them feel welcome. They shouldn’t just be siphoned off into beer tents. Racecourse infrastructure must be aware of where the horse is on the racecourse.
Also, let’s say I have a horse running at Ayr but can’t go. I’d be delighted to put six tickets up for auction for other people to be an owner for the day.
It might raise only £40 for charity, but if six people have a really good experience and they represent you for the day and have a behind-the-scenes day with the trainer, then there’s a chance that some of them could become owners. It’s also another chance for people to get close to the horses.