Description
Equine Industry Program
B. Thomas Joy
Windsor, Ontario, Canada
1996 Galbreath Award
(Transcript of Lecture)
The John W. Galbreath Award for Outstanding Entrepreneurship in the Equine Industry has been presented each
year since 1990 to one individual whose success within the industry has been due to the utilization of uncommon
abilities or innovative approaches to business management. Each recipient has had a positive impact on the equine
industry because of his entrepreneurship, and has gained widespread respect for it.
John W. Galbreath, in whose name the award is presented, distinguished himself internationally as both a
horseman and a businessman. No one else has ever bred and raced winners of the Kentucky Derby (Chateugay and
Proud Clarion) and also the Epsom Derby (Roberto). He was the owner of Darby Dan Farm (producer of over 90
stakes winners) and the Pittsburgh Pirates baseball team, as well as chairman of the board of Churchill Downs. His
business interests included large-scale development projects around the world.
Winners of the Galbreath Award have been: John A. Bell, 1990; James E. Bassett, 1991; Cothran Campbell,
1992; John R. Gaines, 1993; Ami Shinitzki, 1994; Robert Clay, 1995; and B. Thomas Joy, 1996. Recipients are
invited to the UofL campus in the fall of their award year to deliver the annual Galbreath Lecture to students,
faculty, and guests, usually dealing with their own experiences and their personal philosophies.
B. Thomas Joy, the 1996 recipient of the Galbreath Award, is chairman and CEO of Windsor Raceway, a pari-
mutuel harness track located in Windsor, Ontario, Canada. Joy purchased the track in 1989 as a passive investment,
but became active in its management after losing $10 million within three years. In spite of competition from a
casino in downtown Windsor, and simulcasting in Detroit, across the river, Windsor Raceway had its most
profitable year ever in 1995. Innovations at Windsor include a satellite uplink system, new software enabling the
pooling of U.S. and Canadian wagers, top simulcast programs from Hong Kong, etc., and dramatically higher
purses.
The John W. Galbreath Award is a project of the Equine Industry Program (EIP), an academic unit of the
University of Louisville’s AACSB-accredited College of Business and Public Administration. Created by an act of
the Kentucky State Legislature, the EIP is the only equine program in North America that offers a BS degree in
business administration. Through 1996, nearly 300 undergraduate students have taken EIP courses. Other EIP
functions, in addition to teaching, are industry research and professional service.
Copyright 1996, Equine Industry Program
Equine Industry Program
College of Business and Public Administration
University of Louisville
Louisville, KY 40292
Dr. Robert G. Lawrence, Director
Office: 502.852.7617
Fax: 502.852.7672
ROBERT G. LAWRENCE:
All of us in this room understand what has happened to this industry since 1989 due to
technological advances and increased competition. Pari-mutuel horse racing has probably
changed more in the last decade than in any other period in its history.
This affected our speaker, who bought Windsor Raceway right around that time. Instead of
having a comfortable passive investment to enjoy, he suddenly found that he owned a liability,
one that began losing a great deal of money. Now, I have heard from his associates that there’s
nothing like a money-losing investment to precipitate Tom J oy's entrepreneurial juices, but I am
going to let him tell about some of the steps they took and about the success they had in turning
this harness track around.
Unfortunately, just about the time that he and his management team began getting things
turned around, the “Casino Windsor” opened up practically in their parking lot. Also, over on the
Detroit side of the river, the racetracks were opened up for simulcast wagering. We in Kentucky
are beginning to have to deal with that kind of competition, so we can certainly sympathize with
Windsor’s plight.
Tom J oy's reaction to those two moves was essentially to say, "We’re just going to have to
compete better and smarter," and, again, I'll leave the description of how they competed, and are
competing, for him to talk about. But Windsor is a remarkable story, which why Mr. J oy was
named winner of this award given annually to an entrepreneur, especially one who has gained the
respect of his peers.
One of those is an old friend of this program, Stan Bergstein of Harness Tracks of
America. Stan said, " I really don't know how you guys in the business school define
entrepreneurship, but there is no one in my acquaintance who is more qualified for an award
based on entrepreneurship than Tom J oy.” Well, Mr. J oy does have exactly the characteristics
we look for, and his selection honors this university, this industry, and the memory of J ohn
Galbreath himself. I give you Tom J oy.
Tom Joy
Thank you, Dr. Lawrence, for that kind introduction.
Ladies and gentleman, it is indeed an honor to be here. Several months ago, when they told
me that I had been awarded the J ohn Galbreath Award, I was absolutely surprised, and actually
somewhat shocked. I realized that when you go to purgatory, there is a little heaven ahead.
In Washington, when I was accepting the award, I said that any honor given for achieving
something with a business is probably as much deserved by associates and employees, and, in
the case of this particular award, nothing could be more truthful, and I include the horsemen at
Windsor Raceway in that. When I went to Windsor, I was fortunate enough to gather together
wonderful and outstanding people.
I also want to say that one of the great joys to me about receiving this award was the fact
that I was nominated by Stan Bergstein. Stan, in my judgment, is one of the most competent
individuals that I have known in any industry. On many occasions, I’ve said that Stan is the
engine behind harness racing in America. He is an outstanding executive. In fact, on the very
first day I bought the track, he phoned and introduced himself and asked if he could be of any
help. I am very grateful to Stan for that, and so his having nominated me just makes this award
that much sweeter.
And, of course, the people who received the award in the years prior to mine are certainly
people of tremendous prestige in the horse racing industry. Many of them I know and have
tremendous admiration for. So, I am also very proud and grateful to be in their company. I am
also pleased to be here today to have this opportunity to lecture. I have a 26-year-old daughter,
and while I have never been very successful in lecturing her, maybe I'll do better here today. I
wrote a speech, but I'm not going to pay attention to it. The idea here is to discuss my
background and how I got into buying a racetrack, which, initially, should have got me
committed into a mental institution.
I grew up in a small town in southern Ontario. My parents were Canadian, but I was born in
the United States, so when I was 18 years old – which was many years ago – I went into the
American Army. I stayed in the army for five years and, during most of the time, was overseas.
When I got out, I took a job in the Orient, where I ran retail stores and food operations
throughout the 1950s. In 1959, I came back to St. Catherine's, a little town in southern Ontario,
where I borrowed $2000, and started a plastics business. That grew over the years to the point
that my brother and I at one time owned 18 different companies in North America. So I had a
great deal of success.
But I’ve also had a lot of failures. I am an entrepreneur from the tip of my toes to the top of
my head and with that goes both success and failure. I have gone broke a number of times, and I
have always learned a lot more in the times I went broke then when I was on top of the
mountain. For you young people, never be afraid or ashamed of failure. Be ashamed of not
trying. There is nothing to be ashamed of if you are honest and you go out and have endeavors
that fail. Don't be ashamed to fail, and don't neglect trying to do things because of fear of failure.
It happens. Most people that I know have learned far more from their failures than their
successes. When you succeed in things, you get the idea that you are pretty smart, even when it’s
only luck. But when you fall on your fanny, you’re forced to reexamine yourself and to figure
out what went wrong, and you become a stronger person.
I love horse racing, and I have loved it all my life. When I was a young boy, there were eight
or nine tracks in southern Ontario, and they were the worst looking tracks you ever did see in
your life. Well, I started to go to the races when I was only eight or nine-years-old, and I
absolutely loved it. I bought my first racehorse in the early 1960s from Mr. E. P. Taylor, who at
that time was the ultimate capitalist in Canada. He was a fabulous man with tremendous vision:
he created the Ontario J ockey Club; he built Woodbine, where the Breeders' Cup was held this
year; he was the godfather of racing in Canada; and he was the breeder and owner of Northern
Dancer, which, of course, you all know.
Mr. Taylor sold me my first horse, a 3-year-old gelding, for $3,500. After I had owned this
horse for about six or seven months, and it had run maybe six or eight times with some success, I
was in New York and happened to run into Mr. Taylor. He asked me how I was and then told me
exactly what that $3,500 horse had done in every one of his races. Now, here was a man who
was, as I said, the top industrialist in Canada, at that time building an entire city, yet he loved
racing so much that he knew exactly what that inexpensive horse he had sold to me had done. So
I realized right then that no matter how successful you are in other businesses, once you get into
racing, it captures you. And that lesson, I think, has been important to me in understanding the
true nature of the racing business.
So, how did I get into the racetrack business? First of all, it was a terrible mistake; the worst
business decision I ever made, so I'd like to plead guilty before I go into it. What happened was
that I was sitting in my office in Toronto. We had sold off most of our businesses, and there is
nothing more dangerous than a entrepreneur with a little money in the bank. It's a terribly
dangerous position. The late Louie La Vecque, an industrialist and financier down in Montreal,
called me one day and said he had this racetrack in Windsor. Well, I had never been there. To
me, Windsor was someplace I would stop to get coffee on my way to Detroit. I didn't know
anything about Windsor, and if anybody had told me then that I was going to end my business
career in Windsor, why it would have been like being sentenced to a penitentiary.
Anyhow, I bought the racetrack. I had looked at the figures. It had been there for 25 years or
30 years, it had always made a little bit of money, and it had 177 acres of land just 10 minutes
from downtown Windsor. I said to myself, "How can I go wrong here?" They can just send me
my check every quarter. With inflation, the price of land is going to go up, and this is going to be
a heck of an investment. I thought I was the smartest guy in the world, and so I bought it. The
first year went by and they kept calling me every month and I had to write them a check and send
it down. I sort of thought maybe it was just until they got organized and got things going.
In that first year, we lost $3 million dollars. In the second year, we lost $5 million dollars. In
November of 1990, my accountant said, "Let me tell you something, J oy.You better burn down
that racetrack or you are going to be in pauper's prison, because you can't afford it." Well, I
agreed, and I made the decision that I would go down there to close up the track. I figured I’d go
down, pack everything up, sell off the land, take my licks, and disappear. So, I went down to
Windsor, I checked into the Hilton Hotel, and then I went out to the racetrack.
Let me say something to you young people in business administration, who are going to go
out into the world. If you want to go and close down something, don't go and look people in the
eye. Do it from a distance. It's a lot easier to sit in New York and close a plant. I never used to
have trouble. I used to be considered a pretty mean SOB, but, of course, when I was sitting in
Toronto and closing my plant in Pea Water, Ontario, it was an easy thing to do. Well, I moved
down there to Windsor, went into the racetrack office, and started to go around meeting all the
people. I discovered that our average seniority there was over 20 years. Some of the employees
were waitresses, educating their children from the track. Many people had been there for years
and they were completely dependent on that operation.
I would wander out to the backstretch where those horse-people are. Those of you who are
in equine management know it very well, but there are no more dedicated people in the
world. These are people you can’t help but fall in love with. They get up early in the morning
and they work until late at night, but they do exactly what they love doing. It is a wonderful
environment and culture to be around because you’re with people who are doing what they want
to do. They are all independent and they are fighting all the time and they are tough to handle,
but they are marvelous people because they are doing something they love doing; they are in
business for themselves.
After meeting all these people, I started to think, if I close this track, where are they going to
go to race? This fellow is going to lose 10 horses, and this fellow is going to lose his farm. There
were about 50 horse farms that depended on Windsor Raceway. So I went home one night and I
said to myself, “I can't do this. I don’t want to do it.” Besides, my pride would have been crushed
if I had had to end my career in a complete failure. So, I decided I was going to turn this thing
around, and I started to spend each day trying to figure how we were going to do it. Let me tell
you something, it was the hardest business turnaround that I have ever experienced.
People don't realize what a racetrack really is. For instance, Windsor is a only a medium-
sized track. You have Churchill Downs down the road, and there are other large tracks, such as
Santa Anita, but we are a medium-sized racetrack. Yet, this year we will do about $200 million
in volume. We are the largest food-service operation in all of western Ontario. We have our own
print shop. We have a huge construction crew on our payroll. We have 38 janitors, if you can
believe it. (I still can't believe we have 38 janitors, but we do!) And on and on. Windsor
Raceway is a huge business but people don't understand that. They don't realize that this is a
huge industry.
Let me give you some statistics. The horseracing industry – the racetracks, the horsemen, the
breeding farms, and all – in the Province of Ontario alone employs over 26,000 people. That is
more people than the automotive and steel industries employ combined. I didn't know that five or
six years ago. I had had a modest stable of racehorses for 30 years, but I never looked upon it as
a part of any huge industry. But it is, and, as a result, it's very difficult to turn this industry
around.
We have huge overheads. Windsor is the fifth largest city in Ontario, and our medium-sized
track is the fifth-largest taxpayer in Windsor. We are the sixth-largest user of utilities. We buy 95
percent of all of our supplies for the racetrack, which is worth about $10 to $12 million a year,
locally there in Windsor. Between our backstretch and our front, we employ 1,600 people. So,
we are a very large industry in that town, and one which, when I came down, was getting hit
from all over.
The lotteries came in about 25 years ago. In fact, I was appointed by the then premier around
1975-76 to sit on a lottery commission. In those days, I thought the lotteries were wonderful – I
didn’t own a racetrack at the time – and I thought this will be wonderful. It was to be called
“Winterio,” and it was going to be modest. They planned to sell $100 million dollars, which
seemed like a huge figure, and all the money would go into building ice arenas all over Ontario
for the hockey people.
But like any other government project, once it gets started, it is like weeds in the driveway, it
just keeps growing. The next thing you know, the lottery is a multi-billion dollar business in
Ontario. As soon as the lottery came in, it began growing bigger and bigger, and some of that
growth came from the racetrack. Starting about 15 years ago, or maybe a little bit sooner than
that, attendance at the racetrack started to erode. It happened slowly at first but gradually it
increased. Of course, when attendance falls, purses come down, and that’s the engine behind
horse racing.
If we get rid of the horses, we don't have anything -- we might as well go home. You have to
pay purses because that's what horse-people live by. People see racing as for the wealthy because
of what’s read in the paper – the glamorous sport of kings – but most people in racing earn their
living in racing. On our backstretch, I would say that virtually all the owners of our horses
depend on their purses to replenish themselves. So, the racing business requires purses to buy
horses and to upgrade. Everyone talks about “gypsies,” but I have never run into a horseman
who said he didn't want a good horse, that he’d rather stay with bad ones. Everybody gets up in
the morning dreaming about a great horse. In any case, make no mistake about it, this industry is
made up of a lot of people who depend on purses.
Well, as the attendance started to go down, purses started to go down. Our lowest level was
in 1992. Our purses were so low it was a disgrace. Our racing was poor, we weren't attracting
good horses, and our top drivers were leaving. As a result, we reached the point where we
absolutely could not compete for fans. We did a survey around 1992 to see what the solutions
might be and one of the things that shocked me was that we were losing attendance because
of sports on television, meaning a lot of illegal gaming. When you get six or eight football
games on a weekend, you'd be surprised at the number of gamblers who stay home and bet on
sports instead of going to the racetrack. So it was an accumulation of things that had been
eroding our attendance.
There is an old saying, “You have to study the past to understand the present and to predict
the future.” There is no better example of that, in my judgment, than the racing business. For
many years, racetracks were monopolies. Complacent, the only game in town, they opened their
gates six months of the year. They were rude to you, charged a lot for parking, and charged a lot
for admissions. Their food wasn't that good, you had to tip the guy to get a table, and, if you
wanted a set of binoculars, you had to leave your birth certificate for a deposit. You had to buy
tout sheets from everybody going in, and you were lucky to get in because they usually filled the
place.
They made all kinds of money, and, while the government taxed them, they never
complained much because they had a monopoly. When their meets were over, they would close
up and lock the gates. Their horsemen and their employees, who were part-timers or being paid
by the day, would just go to another racetrack. The tracks didn’t have any professional
management because they didn't need it. They didn’t have any real marketing because, when
you’re the only game in town, you don’t need to do any marketing. They wouldn't even give
anybody a pass. So when lotteries, and then casinos, suddenly appeared on the scene, racetracks
weren’t prepared. They had no strategic plans.
That's why I love to be here talking to you young people. I can't think of another industry in
my business career where there is greater opportunity. If I were starting over again as a young
person, and knew what I know now about the racing industry, I'd be in management course just
like yours, one that would lead me right into racing. Racing is hungry for professional
management. If 26,000 people are employed in the horse industry in Ontario, how many are
there in North America? It’s staggering. Yet, I could take all the top executives in the racing
industry and put them on a coffee table.
Professional trained managers don't exist in racing because you didn’t need them when
tracks were monopolies, and usually owned by someone who was part-time. Now there is an
industry that is trying to compete, and we’re crying out for professional managers, crying out for
people to come and figure out how to do it.
I think we, somehow, have to turn ourselves into an entertainment complex. I intend to keep
horse racing as our core business, our identity, who we are. But we just built a 700-seat bingo
parlor in our grandstand. I’m a horseman and I could care less about bingo, but I am trying to
figure out how to get higher purses, and how to get more people into my building. We did a
survey and we found out that a surprising number of older, retired men would come to the races
two more times a week if they could bring their wives to bingo. So we built a bingo hall and the
next thing you know, we have the guy coming to the races, he drops “Molly” off at the bingo
parlor, and he goes out and bets horses. He doesn't have to lie to her anymore. Everybody is
happy.
And we’re doing some screwy things. We were the first people to bring in Hong Kong. We
had 800 people in at 1:00 in the morning watching horse races from Hong Kong. Three weeks
later, I said, “If we can get this many people in, let's race at night ourselves.” They were going to
put me in a crazy house and take my citizenship away. But I got the horsemen in and they went
along. We raced ten races, 1:00 a.m. post, and we had 1,400 people there. And half the 1,400 had
never been inside a racetrack before! Young people came. It was different. I don't know why
they wouldn't come at 7:00 p.m. but they came at 1:00 in the morning. So we got a new crowd.
We are going to have video lottery terminals (VLTs) going into our racetrack in J anuary. I
know it's controversial in Kentucky. One person says we don't want VLTs, another says if we
don’t get them we’ll die. I hear all the arguments from every side. But the root of the issue is,
what is our goal? In my case, it’s twofold and it’s pretty straightforward: one, I want to make a
profit, and two, I want my horsemen to have the highest purses they can possibly have.
At almost every track, horsemen and management are fighting, but I have wonderful
relations with my horsemen. You know why? Because we have a common goal. I am trying to
make money and I am trying to give them more purses. I own the track and run it like a dictator,
but horsemen can come over and have lunch with me, and I will tell them what I am doing and
my rationale for doing it. Two years ago, before anybody had talked about VLTs, I called my
horsemen in and said, “Someday we may have VLTs because I read about them somewhere. I
want a contract with you right now to say what we'll do in that event.” We wrote a contract two
years about sharing the revenue. So, when VLTs came in, we had it all set up. We didn't have
any trouble with horsemen.
Let me tell you another thing. Racing is just like a utility in its dependence on government. I
didn't like that at first. I never filled out so many forms in my life. We are surrounded by
alphabet agencies, and if we want to bring in a race from Hong Kong, we have to fill out 11
forms from three levels of government. But that’s the game we are in – governments control it.
Yet, I was absolutely shocked to learn that government officials knew nothing about us.
The racing industry tried to keep casinos out with "CASINO NO" buttons and by marching
on the legislature. But it didn’t work. The casinos came in anyway, so what we have to do is
figure out how to stay alive with casinos. Part of our problem was that government officials
simply didn't know anything about us. J ohn Millson, who is here with me today, was successful
and popular as the youngest mayor of Windsor. When he decided not to stay in politics, I
brought him in as president of the raceway. He understands the workings of government.
I said, "J ohn, we have a problem. They don't know who we are." We started to print booklets
and brochures. (I thought I was in the publishing business for awhile!) We began to teach
government officials about us – how many people we employ, how important we are to the
economy, and mainly how important it is to work with racetracks. We paid a monopoly tax, but
were no longer a monopoly. Gradually, we got farmers in the area to start talking to politicians
and they began to understand. They started to realize that even though they wanted casinos,
because they are greedy, they had to be careful not do it at the expense of an industry as
important as horse racing.
What was the result? We had been charged a 7.5 percent racetrack tax – one of the highest in
North America – and in October of this year it was reduced to .5 percent. Tremendous!!! They
allowed VLTs in the racetrack, and, as I said, they’ll be installed in J anuary. They are trying to
level the playing field. In the long term, everything might go down the drain. But the truth is, at
least our politicians now realize how important we are and how necessary it is for them to work
with our industry. For too long, there has been a complacency and an arrogance because of the
monopoly position. You know, “To hell with them - we are the king of sports - we don't have to
talk to them.” Well, they’re going to bulldoze us over if we don't tell them how important we are
and how necessary it is for them to work with us.
These are some of the things we have done, and I am very proud. We have accomplished a
great deal. I get up every morning and there are a hundred more problems on the plate. It is an
obstacle course most of the time. But it is a wonderful and exciting industry to be in. It's an
industry that, after years of stagnation, is in its infancy, where it can grow. I can close my eyes
and visualize 25 years from now racetracks can be dynamic entertainment centers. The horse
industry can be stronger than it has ever been, as long as it's handled right and there is good
strategic planning.
The future is in your hands right here. This is the center of the world’s horse country. I am
going to start encouraging young people to go in this direction. They ask me now if I can give
them a job, but when I ask what they have a degree in, they reply, “Ancient Greek History.” I'd
love to have them come in and say, “I have a business administration degree with a major in
equine.” I'd be putting a hook on them and hiring them, putting them in our departments,
teaching them our business, letting them grow. Pretty soon, 10 to 15 years from now, this
industry would have that nucleus of top executives that we so desperately need.
Thank you very much.
Patrick Vinzant, Equine Club President:
Question: What advice would you give to the Kentucky tracks that are facing competition from
the riverboats?
Joy: Being a diplomat, none. I am reluctant to answer, and I shouldn't presume to answer
it. But if you came and said to me, "Do you want VLTs at your race track? Do you want bingo
parlors at your race track?", I’d say, "If you won't allow a casino within 500 miles of my race
track, and if you won't allow a lottery within 500 miles of my race track, I wouldn't want VLTs
or bingo.” So I start out with a purist attitude.
On the other hand, let’s take Churchill Downs, which is a magnificent and well-managed
track. We at Windsor think Tom Meeker is an outstanding track operator. We follow everything
they do, and we know they have a strong balance sheet. They have made very clever moves over
the years. So we think that they are a very well managed track. I’d hate to see purists say "Let's
limit it to racing" and have the casinos come up the river and take customers away. Three or four
years from now -- when the purses are a third of what they were, and attendance is down by 40
percent, which would be disaster -- they might decide they made a mistake. I think there is more
likelihood of that happening than not.
Our big organization is the Ontario J ockey Club, a billion dollars a year in handle and 75
percent of all the racing in the province. Some time ago, David Wilmot took over as president.
David is a lawyer by training but has worked for the last 25 years with his father, Bud, in the
breeding business. The J ockey Club is nonprofit, all the trustees are horsemen and, to a great
degree, the “swells.” They own the horses and they’re against everything. Never mind slot
machines, you have to wear a top hat and morning suit to get in the joint. But David Wilmot
recently came out with the most articulate article – in The Blood-Horse, I think -- about moving
toward other forms of gaming, slot machines and VLTs. There is a purist who, after he spent a
year running a racetrack, came from absolutely the side of “we don't want any of it” to another
side of it. I think he answers your question better and more articulately then I could.
Question: You have been a formidable competitor to casinos in your area. How would you
describe your relationship with the casino management?
Joy: I was interviewed a while back – I get in trouble often, but, at my age, what can they do to
me? – and I said they were “barracudas.” When they came into Windsor to see about putting a
casino in town, they arrived in private jets and had limousines the size of football fields. They
promised everything, and they were going to do everything. Butter wouldn't melt in their mouths.
But as soon as one of them got the contract, all the others were gone and never seen again. The
guy who got the contract never calls back. Since that was the way I saw it, I called them
“barracudas.”
But they are mostly bottom-line, tough business-people. I got to know most of them, and I
really do think they are honorable, decent and nice, but they are very tough businessmen and I
think in doing business with them, you have to realize that. They are interested in one thing – the
bottom line. They’re going to sweet-talk race tracks, which they view as obstacles. I think some
of them are realizing that some of us are politically strong in our areas, so they are beginning to
give a bit more attention to racetracks. But they don’t do it because they like it, just because it's
necessary.
Question: Do you foresee any backlash against gambling in your community in the next 10
years?
Joy: Yes, I do. Taking off my track owner’s hat and putting on my citizen’s hat, it is difficult for
me to believe that we are going to keep going in this direction. I think ten years or so from now,
people are going to say “Stop, you are draining all this money out of the community. That casino
in Windsor makes a million dollars a day, and they are going to put three more into Detroit. I
would say there will be a backlash because there will be horror stories, and eventually there will
be saturation. I think there will be a rebellion and I think the citizens in many places will react.
I think if racetracks are smart, they will manage their affairs knowing that this may happen.
In fact, that's why I say that the worst mistake a race track can make is, when moving into these
new gaming areas, to become mesmerized by all the money in these other areas and to neglect
racing. Because if they do that, they will just be another gaming joint, whereas if they don't do
that, when the eventual backlash comes, they can go back to their core business. No one ever got
mad at the racing, so our strength in competing is to emphasize our racing core. When there is an
ultimate backlash, I think that racing will survive. Every place you look, boats coming down
rivers and more and more casinos, eventually there has got to be a backlash – in my judgment.
Question: Do you have any programs in place at Windsor to aid and detect compulsive
gamblers?
Joy: Yes. All of our daily programs say, “If you have a compulsive gambling problem, call this
number.” We contribute to Gambler's Anonymous, and we contribute to an organization in
Ontario for compulsive gamblers. I am also a board member of a huge rehabilitation center for
alcoholism and drug abuse that was started 25 years ago in Windsor by a Catholic priest.
Recently, the raceway gave $2 million dollars to build a youth center at that center. That's kind
of a personal thing, because I have been in Alcoholics Anonymous for 37 years. When I came
back to open up my plastics business, I had a drinking problem, so I joined AA a long time ago,
when I was very young.
That’s why I have always been grateful for those programs being available to help me before
my life was completely destroyed, and over the years I have been sensitive to that. But I also
know enough about all these slogans and everything that you cannot give help people with their
problem – whether it is alcoholism, drug addiction, or compulsive gambling – until they ask for
it. What we try to do is let people know that there is help available and let them know where they
can go, because no one will make them ready until they are ready. We are very sensitive to the
problem.
Question: As part of your restructuring, did you buy the tote equipment in use at Windsor, and
if so, would you please tell why you bought the equipment and your relationship with other tote
companies in receiving simulcasts, and any plans for tote company investment in the future?
Joy: That's a good question. I bought the tote equipment because I didn't want to be dependent.
The way it worked is that tote companies would come in and they would put all their equipment
in and charge you a percentage of your handle. As a part of this, they'd send in people who were
working for the tote company. Well, I don't like people working in my building that don't
answer to me. If they weren’t showing up, I couldn't fire them. And when I hollered down the
hall, they’d say, “To hell with you, we don’t work for you.” So one day I decided that was
enough.
We went to the tote company we were doing business with and said we want to buy their
tote system. They said, “We don't sell our equipment.” So I went to another tote company, and
then I had to go to a third one. Well, I guess they needed money because they sold it to me. We
paid a million and half dollars for a tote system and we went out and hired our own people. I call
them my nerds. They are inoculated against charisma, but they can do absolutely everything in
the world to work the system and it has been one of the best decisions we made.
J ohn Millson has been the engineer behind that. J ohn loves the technology and he's good at
it. We have ten people in the department now but we won't limit it to that. Our bingo is tied into
all our computers and our tote systems, and we'll tie the VLT system in. All our reporting and
accounting are tied in, so it has been a great thing. The Ontario J ockey Club has a tote company
different than ours, and it’s a terrible system. It’s going to have change because day by day we
are becoming more and more global. We are bringing in Australia, Hong Kong, and the
American tracks. We'll do a million dollars off-track tonight and we'll do $200,000 on track if we
are lucky.
We have to stop this provincial type of thinking, everybody protecting their own thing. We
have to look at ourselves as global. We're going into the United States, we're going all across
Canada, we're going to 200 outlets tonight, and we fully intend to grow. I am going to go over
soon to the Scandinavian countries and have them come into us. I think simulcasting is a global
thing. We'll race around in different time zones that fit. I visualize ten years from now that we
can do a $100 million a month in Europe with our races going in. The tote companies aren't
making any money, so pretty soon somebody is going to say, why don't we figure out how to do
it a better way.
Again, thank you very much. It has been a real pleasure.
Copyright 1996, Department of Equine Business, CBPA, University of Louisville, Louisville, Kentucky.
doc_209191639.pdf
Equine Industry Program
B. Thomas Joy
Windsor, Ontario, Canada
1996 Galbreath Award
(Transcript of Lecture)
The John W. Galbreath Award for Outstanding Entrepreneurship in the Equine Industry has been presented each
year since 1990 to one individual whose success within the industry has been due to the utilization of uncommon
abilities or innovative approaches to business management. Each recipient has had a positive impact on the equine
industry because of his entrepreneurship, and has gained widespread respect for it.
John W. Galbreath, in whose name the award is presented, distinguished himself internationally as both a
horseman and a businessman. No one else has ever bred and raced winners of the Kentucky Derby (Chateugay and
Proud Clarion) and also the Epsom Derby (Roberto). He was the owner of Darby Dan Farm (producer of over 90
stakes winners) and the Pittsburgh Pirates baseball team, as well as chairman of the board of Churchill Downs. His
business interests included large-scale development projects around the world.
Winners of the Galbreath Award have been: John A. Bell, 1990; James E. Bassett, 1991; Cothran Campbell,
1992; John R. Gaines, 1993; Ami Shinitzki, 1994; Robert Clay, 1995; and B. Thomas Joy, 1996. Recipients are
invited to the UofL campus in the fall of their award year to deliver the annual Galbreath Lecture to students,
faculty, and guests, usually dealing with their own experiences and their personal philosophies.
B. Thomas Joy, the 1996 recipient of the Galbreath Award, is chairman and CEO of Windsor Raceway, a pari-
mutuel harness track located in Windsor, Ontario, Canada. Joy purchased the track in 1989 as a passive investment,
but became active in its management after losing $10 million within three years. In spite of competition from a
casino in downtown Windsor, and simulcasting in Detroit, across the river, Windsor Raceway had its most
profitable year ever in 1995. Innovations at Windsor include a satellite uplink system, new software enabling the
pooling of U.S. and Canadian wagers, top simulcast programs from Hong Kong, etc., and dramatically higher
purses.
The John W. Galbreath Award is a project of the Equine Industry Program (EIP), an academic unit of the
University of Louisville’s AACSB-accredited College of Business and Public Administration. Created by an act of
the Kentucky State Legislature, the EIP is the only equine program in North America that offers a BS degree in
business administration. Through 1996, nearly 300 undergraduate students have taken EIP courses. Other EIP
functions, in addition to teaching, are industry research and professional service.
Copyright 1996, Equine Industry Program
Equine Industry Program
College of Business and Public Administration
University of Louisville
Louisville, KY 40292
Dr. Robert G. Lawrence, Director
Office: 502.852.7617
Fax: 502.852.7672
ROBERT G. LAWRENCE:
All of us in this room understand what has happened to this industry since 1989 due to
technological advances and increased competition. Pari-mutuel horse racing has probably
changed more in the last decade than in any other period in its history.
This affected our speaker, who bought Windsor Raceway right around that time. Instead of
having a comfortable passive investment to enjoy, he suddenly found that he owned a liability,
one that began losing a great deal of money. Now, I have heard from his associates that there’s
nothing like a money-losing investment to precipitate Tom J oy's entrepreneurial juices, but I am
going to let him tell about some of the steps they took and about the success they had in turning
this harness track around.
Unfortunately, just about the time that he and his management team began getting things
turned around, the “Casino Windsor” opened up practically in their parking lot. Also, over on the
Detroit side of the river, the racetracks were opened up for simulcast wagering. We in Kentucky
are beginning to have to deal with that kind of competition, so we can certainly sympathize with
Windsor’s plight.
Tom J oy's reaction to those two moves was essentially to say, "We’re just going to have to
compete better and smarter," and, again, I'll leave the description of how they competed, and are
competing, for him to talk about. But Windsor is a remarkable story, which why Mr. J oy was
named winner of this award given annually to an entrepreneur, especially one who has gained the
respect of his peers.
One of those is an old friend of this program, Stan Bergstein of Harness Tracks of
America. Stan said, " I really don't know how you guys in the business school define
entrepreneurship, but there is no one in my acquaintance who is more qualified for an award
based on entrepreneurship than Tom J oy.” Well, Mr. J oy does have exactly the characteristics
we look for, and his selection honors this university, this industry, and the memory of J ohn
Galbreath himself. I give you Tom J oy.
Tom Joy
Thank you, Dr. Lawrence, for that kind introduction.
Ladies and gentleman, it is indeed an honor to be here. Several months ago, when they told
me that I had been awarded the J ohn Galbreath Award, I was absolutely surprised, and actually
somewhat shocked. I realized that when you go to purgatory, there is a little heaven ahead.
In Washington, when I was accepting the award, I said that any honor given for achieving
something with a business is probably as much deserved by associates and employees, and, in
the case of this particular award, nothing could be more truthful, and I include the horsemen at
Windsor Raceway in that. When I went to Windsor, I was fortunate enough to gather together
wonderful and outstanding people.
I also want to say that one of the great joys to me about receiving this award was the fact
that I was nominated by Stan Bergstein. Stan, in my judgment, is one of the most competent
individuals that I have known in any industry. On many occasions, I’ve said that Stan is the
engine behind harness racing in America. He is an outstanding executive. In fact, on the very
first day I bought the track, he phoned and introduced himself and asked if he could be of any
help. I am very grateful to Stan for that, and so his having nominated me just makes this award
that much sweeter.
And, of course, the people who received the award in the years prior to mine are certainly
people of tremendous prestige in the horse racing industry. Many of them I know and have
tremendous admiration for. So, I am also very proud and grateful to be in their company. I am
also pleased to be here today to have this opportunity to lecture. I have a 26-year-old daughter,
and while I have never been very successful in lecturing her, maybe I'll do better here today. I
wrote a speech, but I'm not going to pay attention to it. The idea here is to discuss my
background and how I got into buying a racetrack, which, initially, should have got me
committed into a mental institution.
I grew up in a small town in southern Ontario. My parents were Canadian, but I was born in
the United States, so when I was 18 years old – which was many years ago – I went into the
American Army. I stayed in the army for five years and, during most of the time, was overseas.
When I got out, I took a job in the Orient, where I ran retail stores and food operations
throughout the 1950s. In 1959, I came back to St. Catherine's, a little town in southern Ontario,
where I borrowed $2000, and started a plastics business. That grew over the years to the point
that my brother and I at one time owned 18 different companies in North America. So I had a
great deal of success.
But I’ve also had a lot of failures. I am an entrepreneur from the tip of my toes to the top of
my head and with that goes both success and failure. I have gone broke a number of times, and I
have always learned a lot more in the times I went broke then when I was on top of the
mountain. For you young people, never be afraid or ashamed of failure. Be ashamed of not
trying. There is nothing to be ashamed of if you are honest and you go out and have endeavors
that fail. Don't be ashamed to fail, and don't neglect trying to do things because of fear of failure.
It happens. Most people that I know have learned far more from their failures than their
successes. When you succeed in things, you get the idea that you are pretty smart, even when it’s
only luck. But when you fall on your fanny, you’re forced to reexamine yourself and to figure
out what went wrong, and you become a stronger person.
I love horse racing, and I have loved it all my life. When I was a young boy, there were eight
or nine tracks in southern Ontario, and they were the worst looking tracks you ever did see in
your life. Well, I started to go to the races when I was only eight or nine-years-old, and I
absolutely loved it. I bought my first racehorse in the early 1960s from Mr. E. P. Taylor, who at
that time was the ultimate capitalist in Canada. He was a fabulous man with tremendous vision:
he created the Ontario J ockey Club; he built Woodbine, where the Breeders' Cup was held this
year; he was the godfather of racing in Canada; and he was the breeder and owner of Northern
Dancer, which, of course, you all know.
Mr. Taylor sold me my first horse, a 3-year-old gelding, for $3,500. After I had owned this
horse for about six or seven months, and it had run maybe six or eight times with some success, I
was in New York and happened to run into Mr. Taylor. He asked me how I was and then told me
exactly what that $3,500 horse had done in every one of his races. Now, here was a man who
was, as I said, the top industrialist in Canada, at that time building an entire city, yet he loved
racing so much that he knew exactly what that inexpensive horse he had sold to me had done. So
I realized right then that no matter how successful you are in other businesses, once you get into
racing, it captures you. And that lesson, I think, has been important to me in understanding the
true nature of the racing business.
So, how did I get into the racetrack business? First of all, it was a terrible mistake; the worst
business decision I ever made, so I'd like to plead guilty before I go into it. What happened was
that I was sitting in my office in Toronto. We had sold off most of our businesses, and there is
nothing more dangerous than a entrepreneur with a little money in the bank. It's a terribly
dangerous position. The late Louie La Vecque, an industrialist and financier down in Montreal,
called me one day and said he had this racetrack in Windsor. Well, I had never been there. To
me, Windsor was someplace I would stop to get coffee on my way to Detroit. I didn't know
anything about Windsor, and if anybody had told me then that I was going to end my business
career in Windsor, why it would have been like being sentenced to a penitentiary.
Anyhow, I bought the racetrack. I had looked at the figures. It had been there for 25 years or
30 years, it had always made a little bit of money, and it had 177 acres of land just 10 minutes
from downtown Windsor. I said to myself, "How can I go wrong here?" They can just send me
my check every quarter. With inflation, the price of land is going to go up, and this is going to be
a heck of an investment. I thought I was the smartest guy in the world, and so I bought it. The
first year went by and they kept calling me every month and I had to write them a check and send
it down. I sort of thought maybe it was just until they got organized and got things going.
In that first year, we lost $3 million dollars. In the second year, we lost $5 million dollars. In
November of 1990, my accountant said, "Let me tell you something, J oy.You better burn down
that racetrack or you are going to be in pauper's prison, because you can't afford it." Well, I
agreed, and I made the decision that I would go down there to close up the track. I figured I’d go
down, pack everything up, sell off the land, take my licks, and disappear. So, I went down to
Windsor, I checked into the Hilton Hotel, and then I went out to the racetrack.
Let me say something to you young people in business administration, who are going to go
out into the world. If you want to go and close down something, don't go and look people in the
eye. Do it from a distance. It's a lot easier to sit in New York and close a plant. I never used to
have trouble. I used to be considered a pretty mean SOB, but, of course, when I was sitting in
Toronto and closing my plant in Pea Water, Ontario, it was an easy thing to do. Well, I moved
down there to Windsor, went into the racetrack office, and started to go around meeting all the
people. I discovered that our average seniority there was over 20 years. Some of the employees
were waitresses, educating their children from the track. Many people had been there for years
and they were completely dependent on that operation.
I would wander out to the backstretch where those horse-people are. Those of you who are
in equine management know it very well, but there are no more dedicated people in the
world. These are people you can’t help but fall in love with. They get up early in the morning
and they work until late at night, but they do exactly what they love doing. It is a wonderful
environment and culture to be around because you’re with people who are doing what they want
to do. They are all independent and they are fighting all the time and they are tough to handle,
but they are marvelous people because they are doing something they love doing; they are in
business for themselves.
After meeting all these people, I started to think, if I close this track, where are they going to
go to race? This fellow is going to lose 10 horses, and this fellow is going to lose his farm. There
were about 50 horse farms that depended on Windsor Raceway. So I went home one night and I
said to myself, “I can't do this. I don’t want to do it.” Besides, my pride would have been crushed
if I had had to end my career in a complete failure. So, I decided I was going to turn this thing
around, and I started to spend each day trying to figure how we were going to do it. Let me tell
you something, it was the hardest business turnaround that I have ever experienced.
People don't realize what a racetrack really is. For instance, Windsor is a only a medium-
sized track. You have Churchill Downs down the road, and there are other large tracks, such as
Santa Anita, but we are a medium-sized racetrack. Yet, this year we will do about $200 million
in volume. We are the largest food-service operation in all of western Ontario. We have our own
print shop. We have a huge construction crew on our payroll. We have 38 janitors, if you can
believe it. (I still can't believe we have 38 janitors, but we do!) And on and on. Windsor
Raceway is a huge business but people don't understand that. They don't realize that this is a
huge industry.
Let me give you some statistics. The horseracing industry – the racetracks, the horsemen, the
breeding farms, and all – in the Province of Ontario alone employs over 26,000 people. That is
more people than the automotive and steel industries employ combined. I didn't know that five or
six years ago. I had had a modest stable of racehorses for 30 years, but I never looked upon it as
a part of any huge industry. But it is, and, as a result, it's very difficult to turn this industry
around.
We have huge overheads. Windsor is the fifth largest city in Ontario, and our medium-sized
track is the fifth-largest taxpayer in Windsor. We are the sixth-largest user of utilities. We buy 95
percent of all of our supplies for the racetrack, which is worth about $10 to $12 million a year,
locally there in Windsor. Between our backstretch and our front, we employ 1,600 people. So,
we are a very large industry in that town, and one which, when I came down, was getting hit
from all over.
The lotteries came in about 25 years ago. In fact, I was appointed by the then premier around
1975-76 to sit on a lottery commission. In those days, I thought the lotteries were wonderful – I
didn’t own a racetrack at the time – and I thought this will be wonderful. It was to be called
“Winterio,” and it was going to be modest. They planned to sell $100 million dollars, which
seemed like a huge figure, and all the money would go into building ice arenas all over Ontario
for the hockey people.
But like any other government project, once it gets started, it is like weeds in the driveway, it
just keeps growing. The next thing you know, the lottery is a multi-billion dollar business in
Ontario. As soon as the lottery came in, it began growing bigger and bigger, and some of that
growth came from the racetrack. Starting about 15 years ago, or maybe a little bit sooner than
that, attendance at the racetrack started to erode. It happened slowly at first but gradually it
increased. Of course, when attendance falls, purses come down, and that’s the engine behind
horse racing.
If we get rid of the horses, we don't have anything -- we might as well go home. You have to
pay purses because that's what horse-people live by. People see racing as for the wealthy because
of what’s read in the paper – the glamorous sport of kings – but most people in racing earn their
living in racing. On our backstretch, I would say that virtually all the owners of our horses
depend on their purses to replenish themselves. So, the racing business requires purses to buy
horses and to upgrade. Everyone talks about “gypsies,” but I have never run into a horseman
who said he didn't want a good horse, that he’d rather stay with bad ones. Everybody gets up in
the morning dreaming about a great horse. In any case, make no mistake about it, this industry is
made up of a lot of people who depend on purses.
Well, as the attendance started to go down, purses started to go down. Our lowest level was
in 1992. Our purses were so low it was a disgrace. Our racing was poor, we weren't attracting
good horses, and our top drivers were leaving. As a result, we reached the point where we
absolutely could not compete for fans. We did a survey around 1992 to see what the solutions
might be and one of the things that shocked me was that we were losing attendance because
of sports on television, meaning a lot of illegal gaming. When you get six or eight football
games on a weekend, you'd be surprised at the number of gamblers who stay home and bet on
sports instead of going to the racetrack. So it was an accumulation of things that had been
eroding our attendance.
There is an old saying, “You have to study the past to understand the present and to predict
the future.” There is no better example of that, in my judgment, than the racing business. For
many years, racetracks were monopolies. Complacent, the only game in town, they opened their
gates six months of the year. They were rude to you, charged a lot for parking, and charged a lot
for admissions. Their food wasn't that good, you had to tip the guy to get a table, and, if you
wanted a set of binoculars, you had to leave your birth certificate for a deposit. You had to buy
tout sheets from everybody going in, and you were lucky to get in because they usually filled the
place.
They made all kinds of money, and, while the government taxed them, they never
complained much because they had a monopoly. When their meets were over, they would close
up and lock the gates. Their horsemen and their employees, who were part-timers or being paid
by the day, would just go to another racetrack. The tracks didn’t have any professional
management because they didn't need it. They didn’t have any real marketing because, when
you’re the only game in town, you don’t need to do any marketing. They wouldn't even give
anybody a pass. So when lotteries, and then casinos, suddenly appeared on the scene, racetracks
weren’t prepared. They had no strategic plans.
That's why I love to be here talking to you young people. I can't think of another industry in
my business career where there is greater opportunity. If I were starting over again as a young
person, and knew what I know now about the racing industry, I'd be in management course just
like yours, one that would lead me right into racing. Racing is hungry for professional
management. If 26,000 people are employed in the horse industry in Ontario, how many are
there in North America? It’s staggering. Yet, I could take all the top executives in the racing
industry and put them on a coffee table.
Professional trained managers don't exist in racing because you didn’t need them when
tracks were monopolies, and usually owned by someone who was part-time. Now there is an
industry that is trying to compete, and we’re crying out for professional managers, crying out for
people to come and figure out how to do it.
I think we, somehow, have to turn ourselves into an entertainment complex. I intend to keep
horse racing as our core business, our identity, who we are. But we just built a 700-seat bingo
parlor in our grandstand. I’m a horseman and I could care less about bingo, but I am trying to
figure out how to get higher purses, and how to get more people into my building. We did a
survey and we found out that a surprising number of older, retired men would come to the races
two more times a week if they could bring their wives to bingo. So we built a bingo hall and the
next thing you know, we have the guy coming to the races, he drops “Molly” off at the bingo
parlor, and he goes out and bets horses. He doesn't have to lie to her anymore. Everybody is
happy.
And we’re doing some screwy things. We were the first people to bring in Hong Kong. We
had 800 people in at 1:00 in the morning watching horse races from Hong Kong. Three weeks
later, I said, “If we can get this many people in, let's race at night ourselves.” They were going to
put me in a crazy house and take my citizenship away. But I got the horsemen in and they went
along. We raced ten races, 1:00 a.m. post, and we had 1,400 people there. And half the 1,400 had
never been inside a racetrack before! Young people came. It was different. I don't know why
they wouldn't come at 7:00 p.m. but they came at 1:00 in the morning. So we got a new crowd.
We are going to have video lottery terminals (VLTs) going into our racetrack in J anuary. I
know it's controversial in Kentucky. One person says we don't want VLTs, another says if we
don’t get them we’ll die. I hear all the arguments from every side. But the root of the issue is,
what is our goal? In my case, it’s twofold and it’s pretty straightforward: one, I want to make a
profit, and two, I want my horsemen to have the highest purses they can possibly have.
At almost every track, horsemen and management are fighting, but I have wonderful
relations with my horsemen. You know why? Because we have a common goal. I am trying to
make money and I am trying to give them more purses. I own the track and run it like a dictator,
but horsemen can come over and have lunch with me, and I will tell them what I am doing and
my rationale for doing it. Two years ago, before anybody had talked about VLTs, I called my
horsemen in and said, “Someday we may have VLTs because I read about them somewhere. I
want a contract with you right now to say what we'll do in that event.” We wrote a contract two
years about sharing the revenue. So, when VLTs came in, we had it all set up. We didn't have
any trouble with horsemen.
Let me tell you another thing. Racing is just like a utility in its dependence on government. I
didn't like that at first. I never filled out so many forms in my life. We are surrounded by
alphabet agencies, and if we want to bring in a race from Hong Kong, we have to fill out 11
forms from three levels of government. But that’s the game we are in – governments control it.
Yet, I was absolutely shocked to learn that government officials knew nothing about us.
The racing industry tried to keep casinos out with "CASINO NO" buttons and by marching
on the legislature. But it didn’t work. The casinos came in anyway, so what we have to do is
figure out how to stay alive with casinos. Part of our problem was that government officials
simply didn't know anything about us. J ohn Millson, who is here with me today, was successful
and popular as the youngest mayor of Windsor. When he decided not to stay in politics, I
brought him in as president of the raceway. He understands the workings of government.
I said, "J ohn, we have a problem. They don't know who we are." We started to print booklets
and brochures. (I thought I was in the publishing business for awhile!) We began to teach
government officials about us – how many people we employ, how important we are to the
economy, and mainly how important it is to work with racetracks. We paid a monopoly tax, but
were no longer a monopoly. Gradually, we got farmers in the area to start talking to politicians
and they began to understand. They started to realize that even though they wanted casinos,
because they are greedy, they had to be careful not do it at the expense of an industry as
important as horse racing.
What was the result? We had been charged a 7.5 percent racetrack tax – one of the highest in
North America – and in October of this year it was reduced to .5 percent. Tremendous!!! They
allowed VLTs in the racetrack, and, as I said, they’ll be installed in J anuary. They are trying to
level the playing field. In the long term, everything might go down the drain. But the truth is, at
least our politicians now realize how important we are and how necessary it is for them to work
with our industry. For too long, there has been a complacency and an arrogance because of the
monopoly position. You know, “To hell with them - we are the king of sports - we don't have to
talk to them.” Well, they’re going to bulldoze us over if we don't tell them how important we are
and how necessary it is for them to work with us.
These are some of the things we have done, and I am very proud. We have accomplished a
great deal. I get up every morning and there are a hundred more problems on the plate. It is an
obstacle course most of the time. But it is a wonderful and exciting industry to be in. It's an
industry that, after years of stagnation, is in its infancy, where it can grow. I can close my eyes
and visualize 25 years from now racetracks can be dynamic entertainment centers. The horse
industry can be stronger than it has ever been, as long as it's handled right and there is good
strategic planning.
The future is in your hands right here. This is the center of the world’s horse country. I am
going to start encouraging young people to go in this direction. They ask me now if I can give
them a job, but when I ask what they have a degree in, they reply, “Ancient Greek History.” I'd
love to have them come in and say, “I have a business administration degree with a major in
equine.” I'd be putting a hook on them and hiring them, putting them in our departments,
teaching them our business, letting them grow. Pretty soon, 10 to 15 years from now, this
industry would have that nucleus of top executives that we so desperately need.
Thank you very much.
Patrick Vinzant, Equine Club President:
Question: What advice would you give to the Kentucky tracks that are facing competition from
the riverboats?
Joy: Being a diplomat, none. I am reluctant to answer, and I shouldn't presume to answer
it. But if you came and said to me, "Do you want VLTs at your race track? Do you want bingo
parlors at your race track?", I’d say, "If you won't allow a casino within 500 miles of my race
track, and if you won't allow a lottery within 500 miles of my race track, I wouldn't want VLTs
or bingo.” So I start out with a purist attitude.
On the other hand, let’s take Churchill Downs, which is a magnificent and well-managed
track. We at Windsor think Tom Meeker is an outstanding track operator. We follow everything
they do, and we know they have a strong balance sheet. They have made very clever moves over
the years. So we think that they are a very well managed track. I’d hate to see purists say "Let's
limit it to racing" and have the casinos come up the river and take customers away. Three or four
years from now -- when the purses are a third of what they were, and attendance is down by 40
percent, which would be disaster -- they might decide they made a mistake. I think there is more
likelihood of that happening than not.
Our big organization is the Ontario J ockey Club, a billion dollars a year in handle and 75
percent of all the racing in the province. Some time ago, David Wilmot took over as president.
David is a lawyer by training but has worked for the last 25 years with his father, Bud, in the
breeding business. The J ockey Club is nonprofit, all the trustees are horsemen and, to a great
degree, the “swells.” They own the horses and they’re against everything. Never mind slot
machines, you have to wear a top hat and morning suit to get in the joint. But David Wilmot
recently came out with the most articulate article – in The Blood-Horse, I think -- about moving
toward other forms of gaming, slot machines and VLTs. There is a purist who, after he spent a
year running a racetrack, came from absolutely the side of “we don't want any of it” to another
side of it. I think he answers your question better and more articulately then I could.
Question: You have been a formidable competitor to casinos in your area. How would you
describe your relationship with the casino management?
Joy: I was interviewed a while back – I get in trouble often, but, at my age, what can they do to
me? – and I said they were “barracudas.” When they came into Windsor to see about putting a
casino in town, they arrived in private jets and had limousines the size of football fields. They
promised everything, and they were going to do everything. Butter wouldn't melt in their mouths.
But as soon as one of them got the contract, all the others were gone and never seen again. The
guy who got the contract never calls back. Since that was the way I saw it, I called them
“barracudas.”
But they are mostly bottom-line, tough business-people. I got to know most of them, and I
really do think they are honorable, decent and nice, but they are very tough businessmen and I
think in doing business with them, you have to realize that. They are interested in one thing – the
bottom line. They’re going to sweet-talk race tracks, which they view as obstacles. I think some
of them are realizing that some of us are politically strong in our areas, so they are beginning to
give a bit more attention to racetracks. But they don’t do it because they like it, just because it's
necessary.
Question: Do you foresee any backlash against gambling in your community in the next 10
years?
Joy: Yes, I do. Taking off my track owner’s hat and putting on my citizen’s hat, it is difficult for
me to believe that we are going to keep going in this direction. I think ten years or so from now,
people are going to say “Stop, you are draining all this money out of the community. That casino
in Windsor makes a million dollars a day, and they are going to put three more into Detroit. I
would say there will be a backlash because there will be horror stories, and eventually there will
be saturation. I think there will be a rebellion and I think the citizens in many places will react.
I think if racetracks are smart, they will manage their affairs knowing that this may happen.
In fact, that's why I say that the worst mistake a race track can make is, when moving into these
new gaming areas, to become mesmerized by all the money in these other areas and to neglect
racing. Because if they do that, they will just be another gaming joint, whereas if they don't do
that, when the eventual backlash comes, they can go back to their core business. No one ever got
mad at the racing, so our strength in competing is to emphasize our racing core. When there is an
ultimate backlash, I think that racing will survive. Every place you look, boats coming down
rivers and more and more casinos, eventually there has got to be a backlash – in my judgment.
Question: Do you have any programs in place at Windsor to aid and detect compulsive
gamblers?
Joy: Yes. All of our daily programs say, “If you have a compulsive gambling problem, call this
number.” We contribute to Gambler's Anonymous, and we contribute to an organization in
Ontario for compulsive gamblers. I am also a board member of a huge rehabilitation center for
alcoholism and drug abuse that was started 25 years ago in Windsor by a Catholic priest.
Recently, the raceway gave $2 million dollars to build a youth center at that center. That's kind
of a personal thing, because I have been in Alcoholics Anonymous for 37 years. When I came
back to open up my plastics business, I had a drinking problem, so I joined AA a long time ago,
when I was very young.
That’s why I have always been grateful for those programs being available to help me before
my life was completely destroyed, and over the years I have been sensitive to that. But I also
know enough about all these slogans and everything that you cannot give help people with their
problem – whether it is alcoholism, drug addiction, or compulsive gambling – until they ask for
it. What we try to do is let people know that there is help available and let them know where they
can go, because no one will make them ready until they are ready. We are very sensitive to the
problem.
Question: As part of your restructuring, did you buy the tote equipment in use at Windsor, and
if so, would you please tell why you bought the equipment and your relationship with other tote
companies in receiving simulcasts, and any plans for tote company investment in the future?
Joy: That's a good question. I bought the tote equipment because I didn't want to be dependent.
The way it worked is that tote companies would come in and they would put all their equipment
in and charge you a percentage of your handle. As a part of this, they'd send in people who were
working for the tote company. Well, I don't like people working in my building that don't
answer to me. If they weren’t showing up, I couldn't fire them. And when I hollered down the
hall, they’d say, “To hell with you, we don’t work for you.” So one day I decided that was
enough.
We went to the tote company we were doing business with and said we want to buy their
tote system. They said, “We don't sell our equipment.” So I went to another tote company, and
then I had to go to a third one. Well, I guess they needed money because they sold it to me. We
paid a million and half dollars for a tote system and we went out and hired our own people. I call
them my nerds. They are inoculated against charisma, but they can do absolutely everything in
the world to work the system and it has been one of the best decisions we made.
J ohn Millson has been the engineer behind that. J ohn loves the technology and he's good at
it. We have ten people in the department now but we won't limit it to that. Our bingo is tied into
all our computers and our tote systems, and we'll tie the VLT system in. All our reporting and
accounting are tied in, so it has been a great thing. The Ontario J ockey Club has a tote company
different than ours, and it’s a terrible system. It’s going to have change because day by day we
are becoming more and more global. We are bringing in Australia, Hong Kong, and the
American tracks. We'll do a million dollars off-track tonight and we'll do $200,000 on track if we
are lucky.
We have to stop this provincial type of thinking, everybody protecting their own thing. We
have to look at ourselves as global. We're going into the United States, we're going all across
Canada, we're going to 200 outlets tonight, and we fully intend to grow. I am going to go over
soon to the Scandinavian countries and have them come into us. I think simulcasting is a global
thing. We'll race around in different time zones that fit. I visualize ten years from now that we
can do a $100 million a month in Europe with our races going in. The tote companies aren't
making any money, so pretty soon somebody is going to say, why don't we figure out how to do
it a better way.
Again, thank you very much. It has been a real pleasure.
Copyright 1996, Department of Equine Business, CBPA, University of Louisville, Louisville, Kentucky.
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