The Viability of the "Project Horse"

So it's been a few years and your farm is up and running. You feel pretty good about the care you're providing your horses, and you're no longer drowning in start-up projects. I think it's pretty natural at this stage (if not sooner!) to start thinking about acquiring more horses. After all, you have the space and you can tell yourself that spreading the fixed costs across more horses actually means that each horse costs you less. You're saving money, right!? (Okay, not really, but this is how we horse people think.)

One idea you may have is to take on a project horse, something you will buy, train up, and sell--hopefully at a profit. The recipe for success with a project horse is complex:

• One sound, sane horse with potential for success in your discipline, acquired for a reasonable price (bonus points if said horse is flashy, but at the very least it should be a desirable breed, size, sex, and color)
• Minimal-cost horse care/board (here is where it is crucial to have your own farm because it's much less feasible to profit on a project if you're paying $500-1000+ for board per month)
• Regular doses of skilled riding and training (with support from trainers as needed)
• Required registrations and competition entry fees, and success at those competitions
• Good luck so that horse will remain sound, sane, and marketable

If you have all those ingredients, making money on a project horse is possible, but I wanted to relate my experience with this in the hopes that it helps anyone thinking of taking on the same thing. This isn't exactly related to farm management, but it's a topic that does often come up for farm owners.

The Project Pony

I bought Gwen in July of 2018. Here's another tip: if you buy a resale project, you're off to a good start if it's totally adorable! Just look at this cute face and big poofy forelock:

Gwen meets Dominick the Donkey for the first time, in a showdown of adorableness.

Gwen was a green-ish 7-year-old who had been through a couple of owners and was currently at a very small lesson barn where she wasn't quite suitable to the beginner clientele due to her forwardness and sensitivity. As far as I could tell when I first bought her, her pros as a project were:

• Adorable (see photo for proof)
• Well-kept and apparently healthy
• Not too old
• Clean legs, eyes, etc
• Good feet
• Decent gaits
• Described as pretty unflappable (this turned out to be true)
• Game to jump (very true!)
• No apparent vices (also true)
• Registerable with a breed association

Her cons were:

• Plain bay mare
• Too small for most adults
• Too forward/sensitive for many kids
• Some holes in her training (rushy canter, no concept of correct contact)

The Project Plan...and Reality

When I bought Gwen in July I planned to sell her within 3 to 9 months. I charted out expected monthly expenses, added in a buffer for unexpected extras, and calculated the price I'd need to sell her for to break even at 3 or 9 months. (I deleted that document a while ago but remember it not being terribly far off reality as far as monthly and occasional expenses.)

The first thing I discovered was that three months was wildly unrealistic. She hadn't been in consistent work when I bought her so I conservatively spent about a month legging her up to avoid injuries. It was a good way to get to know each other too. We spent most of that month on the trails, first just walking and then as the weeks passed adding in trot and canter. She proved to be a phenomenal trail horse--brave, confident without other horses, and very surefooted. My young horse was lame at that time with an uncertain future, and riding Gwen through the woods and fields was very therapeutic.

Nothing soothes the soul like a view of nature through a good horse's ears.

We started jumping lessons after about a month and I learned that although she was extremely game, she was also greener than I expected. She had a lot of scope and could get around a course, but tended to get flat and fast. Jumping lessons proved crucial to bringing her along well. Most of my experience is in dressage, so I don't think I could have added as much value to her without jumping lessons.

At the end of three months, we had just done our first horse trial (starter/elementary-level). She tied for first in dressage and jumped double clear despite some nasty weather and slick footing. I was thrilled with her performance and with how much fun I'd had. That was probably about the time I realized I wasn't selling her before winter, and resigned myself to buying some pony-sized blankets.

In month five we did our first Beginner Novice horse trial (still unrecognized) and she was just as fabulous. We spent the winter dabbling in foxhunting (not her strength...she got uncharacteristically wired) and working on our dressage and jumping.

Pony's got springs! In a demonstration of her scope, 13.2 hh Gwen easily clears a 3'3" oxer during a winter lesson.

In month nine, when spring rolled around, we did another unrecognized Beginner Novice then moved up to recognized, where she still excelled at the jumping phases while turning out respectable (though not usually top-placing) dressage tests. Now I felt like I had created demonstrable value, because in addition to being much much more rideable over fences and correct on the flat, she was logging recognized show miles.

At the end of month eleven I put her on the market and she was sold within two weeks. I still miss her but am thrilled with the home she found, with a smaller adult amateur who is a better size for her and spoils "the princess" rotten.

The Project Profitability

Although I kept her for longer than expected, I recognize that I got pretty damn lucky with this project all-around. She was super easy to add to my menagerie because she was happy to live outside alone when needed but also got along when turned out with others. She wasn't "mare-ish" at all. She didn't turn out to be chronically unsound or nutty. She didn't have any devastating injuries. I found a buyer pretty quickly once I decided to sell.

And yet, I still didn't make any money. Let me break it down for you. As you may have learned already, I'm kind of a spreadsheet person so naturally I tracked every single expense related to the pony in an Excel document. I didn't factor in my time/labor or any general property-related expenses since she was an "add-on" to my existing herd.

Here is a summary of my expenses:

Pony purchase: $1,600
One year of "board": $598 (yes, you read that right...less than $50/month for grain, hay, and bedding)
Trims/shoeing: $740 (she was barefoot until shortly before I sold her)
Vet/dentist/meds: $2,439 (about $1,000 routine and $1,500 to resolve a specific issue)
Equipment (saddle fitting, pony-sized girth, fly mask, blankets, etc): $690 but I sold some of it with her for $320, so net of $370

Factoring in only the above expenses, I pretty much broke even when I sold her after a year.

However, I spent about $2,200 on shows, foxhunting, and clinics. Obviously those were fun and educational for me but the shows were also required to justify her sales price, which was a good amount above the $1,600 I had spent on the good-natured but green pony.

I also spent about $2k in dressage and jumping lessons during that time. Again, those were partially for my education and enjoyment, but I would not have created as much value in the pony without them. I could have brought her along fairly well on the flat because I have a strong dressage background, but I was getting back into jumping after some time off and both the pony and I really benefited from the jumping lessons.

In the end, I decided it was fair to apportion half of the shows, clinics, lessons, etc to the pony's development costs and half to myself because I was benefiting too. Adding up all the expenses I mentioned above plus half of those costs, I lost about $2,500 on my project pony. I don't regret it at all because I think $2,500 is a small price to pay for a year of fun with a freakin adorable pony, but it's certainly not a good business model. Good thing I'm not in horses for the money!

I can't say I won't ever do the project horse thing again, but I do worry that I wouldn't get so lucky twice. I would also be careful to start with one that I think will be easy and low-maintenance like Gwen, but you really never know what you've got until you bring a new horse home and work with it for a bit.

Just some food for thought if you find yourself wondering whether you can fill that extra stall with a money maker!