California Chrome's bid for the Triple Crown on Saturday is likely to boost TV ratings and, if he wins, create a star for a sport that could badly use one.
It will be a bonanza for the horse's owners, although their payoff will be limited by Chrome's humble parents and the racing industry's delicate health.
Racing insiders say that if California Chrome becomes the first Triple Crown winner in 36 years, his breeding value is likely to be between $15 million and $20 million. That's a stunning return for owners who paid $8,000 for the horse's mare and another $2,500 to breed her to a stallion with a mediocre racing record.
The horse could bring in millions more in sponsorships and book and movie deals. Shoe company Skechers just announced it will put its brand on California Chrome caps, clothes and horse blankets -- financial terms weren't disclosed -- and more deals are sure to follow if Chrome wins Saturday.
The payoff, however, might fall short of expectations set by Chrome's team. Before the colt won the Kentucky Derby, his owners said they rejected a $6 million offer for a 51 percent share in the horse. After he won the Preakness, his trainer declared that he was worth $30 million.
Breeders and others in the thoroughbred industry say that's too high given what they consider Chrome's modest pedigree. He is no Kentucky blueblood. His underdog identity -- born in California, schooled by a 77-year-old trainer, owned by seemingly regular guys who call their business Dumb Ass Partners -- makes him a favorite of racing fans, but fails to excite the professionals whose job is to put a price on horse flesh.
"Breeders are hard-nosed. They wouldn't be swayed unnecessarily by Triple Crown fever," said Cot Campbell, who founded Dogwood Stable in 1969 and helped pioneer partnerships to own Thoroughbreds. He is rooting for Chrome and says a Triple Crown would raise the horse's price, "but if he were regally bred, he would be even more valuable."
That was true for Fusaichi Pegasus, who won the 2000 Kentucky Derby but lost the Preakness and skipped the Belmont. He was reportedly sold to Ireland's Coolmore Stud in a $60 million syndication deal. It helped that his father was Mr. Prospector, one of the top sires of the past 40 years.
Smarty Jones, who won the Derby and Preakness but fell short in the 2004 Belmont, was syndicated in a deal that put his value at $39 million, according to published reports -- financial terms weren't disclosed. Big Brown, who lost the 2008 Belmont after winning the first two races, was reported to have sold in a $50 million deal.
The horse industry was healthier when those deals were made. Stud fees have fallen sharply from bubble-like levels before the recession, reflecting in lower prices for stallions. There are fewer potential buyers -- maybe a half-dozen farms in Kentucky, plus a few deep-pocket foreign buyers.
Terence Collier, the director of marketing at Thoroughbred auction house Fasig-Tipton, said most people he talks to value Chrome at $15 million to $20 million if he wins Saturday. That's based on a formula that includes an estimate of the horse's stud fee.
Some sires who have produced winners of top races can command fees of $150,000 per mare. As an unproven sire, Chrome would be likely price anywhere between $20,000 and $50,000, breeders said. There are famous sires in Chrome's pedigree if you go back three or four generations, but breeders say it is more significant that his father and mother weren't great runners and haven't yet produced other winners.
"Using horses like Big Brown and Smarty Jones as benchmarks, (Chrome) could easily be worth $20 million if he becomes the next Triple Crown horse -- and that's probably on the low side," said Mike McMahon, who runs breeding and racing operations in Kentucky and New York and had one of the most upbeat appraisals of Chrome's value.
McMahon figures that the only way Chrome can overcome doubts about his pedigree is to run a terrific race in the Belmont -- good enough to evoke comparisons with Secretariat's 31-length victory in record time in 1973.
Besides breeding value, owners of popular racehorses can earn money from marketing and book and movie deals.
Funny Cide was a bargain horse who won the Kentucky Derby and Preakness in 2003 and developed a fan following partly because of his everyman owners -- a bunch of high school pals who rented yellow school buses to drive to the track on race days. His owners landed a $1 million book deal -- a movie fell through -- and other lesser endorsements.
A movie or television deal for California Chrome is possible but not a sure thing, said veteran producer Dan Paulson, whose credits include the new Hallmark Channel movie "The Color of Rain."
"It's a story about an underdog, that's the most interesting part of it," Paulson said. The return of movies and miniseries to networks that once shunned them helps by expanding the list of potential buyers, he added.
A website operated for Secretariat's owner, Penny Chenery, sells about 150 items ranging from bobbleheads to photographs signed by his jockey. A nail that held the horse's shoes in the Belmont sold for $6,100.
Leonard Lusky, who handles marketing of the horse, thinks that Chrome would have opportunities that didn't exist for Secretariat and could top $1 million in merchandise sales. "With social media, Facebook, Twitter, you can reach beyond the core fan. It will be a frenzy," he said.
Chrome's owners could also try to earn more money at the track. They could enter him in high-stakes races such as the Breeders Cup Classic this fall in his native California, where a win would be worth $2.75 million. It might do the sport good for a champion to keep running.
Racing again poses challenges. Superstars usually don't stick around long enough for most fans to see them because the best are often retired at 3 to earn big stud fees rather than risk catastrophic injury.
"Sometimes when you're offered so much money, it's hard to refuse," Chrome's trainer, Art Sherman, said this week when asked if the horse would race another year.
But it's possible.
"(The owners) just got him insured for a lot of money. You don't pay the insurance premium and sell him right away."