It’s been a whirlwind of a year for horse racing in Lexington, and Connie Hale and Shan- non Cobb have been spinning together right through the middle of it.
From the Red Mile’s $42 million renovation project to Keeneland’s hosting of the Breeders’ Cup to the joint venture created to introduce historical racing wagering to Lexington, 2015 brought one groundbreaking initiative after another to the city’s two historic racing venues, along with a level of collaboration between them that has not been seen in recent decades. For Cobb and Hale, who serve as CFOs for the Red Mile and Keeneland respectively, having a friend to share the financial reins for that wild ride has been a welcome support.
“Everything we could do we did in one year,” Cobb said, with a quick elbow nudge to Hale and a shared sidelong grin. “And we’re still smiling.”
Hale and Cobb share an easygoing familiarity with each other that belies the intensity of the transformation they have been helping to oversee. While Cobb has been working to help bring the Red Mile back onto solid and self-sustaining financial footing, Hale’s long-term mission has been to provide strong financial stewardship to reinforce Keeneland’s existing assets and longstanding racing traditions. Both goals have required the women to navigate new territory in their industry, often in tandem.
Historical racing brings it together
With the advent in Kentucky of historical racing, a pari-mutuel offering based on previously run, anonymous races, both the Red Mile and Keeneland quickly identified the advantages of a collaborative launch and jumped on board. The result has been a renovated and expanded Red Mile facility featuring 902 historical racing terminals. The improvements have created an ex- panded source of revenue to bolster racing for both Thoroughbreds and Standardbreds, along with an estimated 200 jobs and related economic impact to the community.
In its first six months, the joint venture, KRM Wagering LLC, has performed better than either group had hoped. The historical horse racing handle at the Red Mile has grown every month since November, Cobb said, and the total recently surpassed the $100 million mark.
“Everyone recognizes that the equine industry must survive and thrive as a whole, and not just as individual breeds through individual efforts,” Cobb said.
The organizations, which are equal partners in the endeavor, cemented the partnership further by transferring Keeneland’s year-round simulcasting operations to the Red Mile. Both organizations hope the consolidation of simulcast, historical racing and live racing in one entertainment destination will attract a new clientele to the sport, with renewed interest in all forms of racing entertainment.
“It’s so critical to the whole commonwealth that it makes sense for us to work together, and it has worked out even better than any of us thought it would,” Hale said.
Having known each other since Hale started at Keeneland in 2012, both women knew they would work well as a team, but they said they were surprised at how quickly the cooperative spirit spread throughout both organizations. In addition to the executive leadership, Keeneland and the Red Mile now share information and resources regularly across multiple departments, they said, from finance to human resources to marketing.
Rising through the ranks in finance
For both Cobb and Hale, their current positions are the first they have held in the equine industry, which necessitated a swift learning curve for each of them. Both followed similar career paths before being recruited to take the financial helm for horse racing in Lexington.
Cobb, who grew up in Owenton, Kentucky, worked as a CPA at Deloitte & Touche for
two years after graduating from the University of Kentucky, followed by 13 years as vice president of finance/CFO for Treasure Isles, a large employee-owned franchise operation for Fazoli’s and Long John Silver’s restaurants. Aside from fond memories of rides on a pony named Star at her grandfather’s tobacco farm, she didn’t have equine experience when she was approached about the CFO opening at the Red Mile. Red Mile President and CEO Joe Costa convinced her to make the jump to the racing industry in 2002, she said, with the chance to play a part in turning around the struggling harness-racing track with a storied local history.
“His enthusiasm to revitalize the Red Mile was contagious,” Cobb said.
Hale, a Battle Creek, Michigan, native, graduated summa cum laude from Albion College in her home state before cutting her teeth for four years in the tax and audit departments at Ernst & Young, then known as Ernst & Whinney. She spent 26 years in Raleigh, North Carolina, with CAPTRUST Financial Advisors and Critical Health Systems before being wooed to Lexington to serve as CFO of Unified Trust Company. When a recruiter approached her in 2012 about joining Keeneland’s team, she said she jumped at the chance.
“It was such a unique opportunity and an awesome place,” Hale said. “And a chance to try something different.”
Both Cobb and Hale serve actively on boards in the local community, with organizations that carry personal interest for them. Cobb currently serves as treasurer for the Race for Education, a group that shares her passion for supporting advancement through mentorship. For Hale, who was widowed at age 35 when her husband, a Raleigh police detective, was killed in the line of duty, serving on the board of the Kentucky State Police Foundation has given her the chance to help others who have endured the same tragic experience. She is also active on the board of God’s Pantry.
The women at the table
As female CFOs, Cobb and Hale are a rare breed among management circles within
the horse racing industry. A 2015 report by Fortune magazine found that, although the number of women in executive leadership has grown slightly in recent years, only 58 of the CFOs serving at Fortune 500 companies, or 11.6 percent, were women. Although official numbers are hard to come by, executive leadership on the boards for horse racing associations across the country are also heavily weighted toward men.
Both Cobb and Hale said that personally, the gender gap isn’t something they have given a lot of thought, aside from cracking an occasional water-cooler joke about the dearth of estrogen in the room. Males have heavily outnumbered females in all their workplaces throughout the years, and while both said they are pleased to see that starting to change, it’s not something that has ever held them back. Both Hale and Cobb also credit strong men- tors in their formative years with encouraging them to immerse themselves in all aspects of the business and helping them to build the competence and confidence to do that.
But that’s not to say that gender doesn’t color their management style. Having competitive personalities is a prerequisite in their industry, Cobb and Hale said, but for them, it’s more about being tenacious in pursuit of their own high goals than beating the next guy, which has helped the recent collaborative efforts to come naturally. And both are passionate about protecting the future of the sport and the legacies of their respective institutions.
Red Mile renaissance
For years, the operation of the Red Mile has required cash flow support from its ownership groups, but the transformation jumpstarted by the addition of historical racing is aimed at changing that, Cobb said.
The organization knew it had to build a new income stream to preserve and support its racing traditions. Its management team had been preparing the business and the property for its next iteration in racing entertainment for more than a decade, Cobb said, without knowing exactly what would anchor that transformation. Historical racing stepped in with the answer.
As part of its improvements, the Red Mile established a new central roadway, known as the Town Green, designed to serve as an open corridor for further development. The long-term vision for the venue would transform it into a potential tourist attraction, complete with restaurants, retail shops and an on-site hotel.
“In the long term, it will be a full mixed- use development of residential, commercial, retail and entertainment, while preserving the track and its historical parts at the same time,” Cobb said.
“You’ve got to have cash flow to keep those things going.”
For Cobb, the part of her job that she loves the most is helping to chart the Red Mile’s course through strategic management.
“The numbers tell a story. They are a key component that tell you how to keep score, and you have to have that, but marrying the financial side with the management side is the fun part to me,” Cobb said.
Keeneland’s year to shine
The culmination of Keeneland’s year came with its hosting of the 2015 Breeders’ Cup World Championships in October, an event that drew a record-breaking Saturday crowd of 50,150 to the venue to bear witness to Triple Crown winner American Pharoah’s Breeders’ Cup Classic win. Although attendance and handle were down slightly from the previous year’s Breeders’ Cup held at Santa Anita Park, ticket revenue more than doubled, as racegoers signed on for numerous high-end hospitality packages offered throughout Keeneland’s grounds for the event. Reviews of the event praised the racetrack for its successful execution of a formidable undertaking.
In addition to the Breeder’s Cup, the joint venture with the Red Mile on historical racing and the simulcast move, Keeneland also took over the management of its own food and beverage service in 2015 (as did the Red Mile) and underwent the transitioning of its track surfacing back to dirt the previous summer.
For the moment, Hale said, life at Keeneland has been about getting back to what the track does best.
“We are concentrating on our core business lines right now,” Hale said.
This year’s spring meet opened with a record-setting handle for Keeneland in its first weekend, Hale said, with expectations for a strong season to capitalize on its exhilarating Breeder’s Cup debut.
While Hale enjoys the racing meets, she said her favorite part of Keeneland’s business is the sales.
“All the science and research that goes into buying a horse, I find it fascinating. I love everything about it,” Hale said. “I have a little office down in the sales pavilion, and I’m down there from before it starts until after it ends, watching every horse go through the ring. It’s very exciting.”
On the financial side, managing annual sales of more than $535 million per year with a guaranteed payout within 30 days can be harrowing, but Hale said she likes the challenge of it.
“There’s a tad bit of stress there, ... but juggling all that, I just thrive on it,” Hale said. “I really love it.”
Shooting another smile and a wink across the table in Hale’s direction, Cobb added, “I’m going to hold you to that.”