Episode 29: Building Success That Lasts with Craig Bernick

Welcome to this episode of the Million Dollar Mastermind. I'm Larry Weidell, and let's get started. I'm excited today to be talking to Craig Burdick. He's in the horse business and he's, you know, it's a unique business to be in at all times, but especially now. He's got a horse farm in Ocala, Florida. He lives in Lexington, Kentucky, and he knows what it's like to be in charge, to be in leadership, to move up, to succeed, to face challenges. Right now we're talking to you from the center of the coronavirus craziness, and none of us really know how to respond. We don't know if this is a great time to be doing podcast, but I was thinking about this, so welcome, Craig. Appreciate you taking the time to get on.

Thanks, Larry. I don't know how many people you've had on your podcast from the horse business, so it might be a little bit of learning about that and about, you know, and about our conversations. I'm really, I'm really excited to be on, on your podcast. Thanks for having me.

Well, thanks so much for having, having me Take some of your time. I know it's a busy time, you got a lot of obligations, but I was thinking about this, Craig, and, you know, I want to get a little background, let bring people up to scale on where you are and all that. But it's really times like this, that focus, it brings out what you believe in. It really challenges all of us. It's almost like it's a direct, almost life or death type challenge to all of us instantly, which is really unusual that we all face it all at once, something unknown, something life altering. But you have to respond, you have to keep moving forward because we all know we're going to come out the other side and you want to have as much momentum with you as possible. And so the people that understand that stay focused on what they can be doing and don't let themselves get overwhelmed are the ones that come out the other side of these things with dramatically improved positions in, in a lot of areas of their life simply because they just stayed on track. And, you know, you do it in minor ways as you go through life, but now this is just a huge one. But you really get challenged in what you believe. And so maybe we're going to get into some of those things. I'd love to hear your take on that, but bring everybody up to speed on who you are, where you are, how you got to where you are in life, so they'll understand your perspective and where you're speaking from.

Well, thanks. I mean, I'm 41 years old. I grew up outside Chicago, Illinois. My family had a consumer packaged goods business called Alberto Culver. We were Aaron Skin care, beauty business. My grandfather founded it. My mother went to work there. After she graduated College in the 70s, she met my father. They ran the business together. And then I was kind of the third generation, very close with my grandfather, obviously close with my parents, and, you know, sort of fully expected to grow up in that business. Sold products in over a hundred countries. We had retail stores called Sally beauty supply, over 3,000 retail stores. And really grew up immersed in that business. You know, every summer job in high school and college was a different part of that business. And then I spent about seven or eight years, you know, really growing up in that business in a variety of roles, did some business development and acquisitions, did investor relations, working on our, you know, annual report, our, you know, communication to the street. Buy side and sell side, both doing investor conferences. I transitioned into sales job, got to make sales calls on most of the large customers, you know, around the country. Moved into marketing on the international side. Really did a lot of travel. And, you know, I was kind of learning that business and being groomed. Interestingly, I was good at it, but I didn't. I probably didn't have the same passion and love for it that my. That was really needed to take it over. And my real love was thoroughbred racehorses, which was always essentially a hobby for my grandfather. He bought a horse farm in the 60s, and I spent every school holiday, Thanksgiving, Christmas and Easter, this farm that I'm at now in Ocala, Florida, and really liked it. In the summers I go to Del Mar, California, and it's all I've ever really wanted to do. And I was lucky enough that my grandfather, he was. He only died a few years ago. I was very close with him, and it was hard leaving Alberto Culver, but I really wanted to transition our horse farm, which had been a really, like a family property and kind of a losing proposition, into a sustainable business, you know, and thankfully, I was able to do that while he was alive. And, you know, so I took over the horse business in 2008 and have been doing it for 12 years. It's a, it's a, it's an interesting business. It's global. There's breeding, racing, buying and selling, you know, kind of in most of the major countries. It's a. It's a huge business. In the US our business was 100% US based. When I took it over, we, we now have a really nice business in Europe. We operate in Ireland, England and France. We're getting started in Australia. We don't participate yet in Asia or the Middle east. And there's also racing in South America and South Africa. It's really a global business and I've learned a lot about it, you know, helped turn our business from a, you know, frankly, a money loser and really a hobby's a bad word with the irs, but, you know, really not one focused on making money and sustainability and have transitioned it into a nice, really investment portfolio. So that's what I've been doing and was lucky enough to have dinner with you, Larry, a couple weeks ago and, you know, mostly listen to your story. So it's flattering to be, you know, to be on your show.

Well, what you've been able to accomplish and the exposures you've had really gives you an advantage in many ways in knowing how to think and how to respond and how to react to life. The challenges that get thrown at you, whether or not you're a common laborer, just, you know, dealing with, you know, family health, normal finances, and the experiences life throw you all the way up to where you're running a Fortune 500 CEO situation. Life is life and there's challenges. You know, we're currently here as the coronavirus unfolds, and I found it's a waste of time to try and talk logic to anybody about it. You know, it's almost like people, it's almost like it comes to believing in God or believing there is no God, believing in capitalism or communism, you know, democrat or republic, liberal or conservative, you believe what you believe. And it's almost impossible to talk someone out, you know, off their point. So I've given up trying to have logical discussions with people that are scared out of their minds with the, the virus. And because you put out, you know, you put, put out one wild scare and they come up with 15 more. And, you know, if you go through life, you're going to have the opportunity to either run from problems or you're going to face problems. And, you know, you never get anywhere running for problems, you know, you know, they come, they're challenges, you know, one form or another. Life is. It's called living, dealing with these challenges. And you've certainly faced a lot of challenges to overcome and climb as high as you have in the horse business, especially taking the horse business, which, you know, as we were talking about, I love horses. I had a little Small horse farm in North Carolina and did the show jumping as a hobby for 16 years. And I did this as a hobby because the way I did it, our family did it. There was no way we were going to be able to turn it. We tried to turn it into a business, but it's a hobby. So you actually turned this complex, confusing mil, you know, millions of variables type situation where you're dealing with the, you know, these fragile animals. And right now we're, you know, right now we're dealing with a weird virus. But you know, horses could have all kind of things go wrong with them. And you know, just from walking, you know, in a paddock, you know, they can get spooked by something and kick the wall and then, you know, there goes a tendon and, and there goes a huge investment. And so, you know, you've been able to survive in that. I've got insane respect for you. And to turn it into where you can actually call it a, you know, investment portfolio that people can invest with you and all the challenges you've had to face and overcome. And it starts with a love. You got to have the love or you're just not going. You can have the challenges in any walk of life, marriage, kids, businesses. If you don't have the love for it as a starting point, you're pretty much doomed, aren't you, Craig?

I mean, I think so. It's, it's, you know, I, there's plenty of people that work hard that aren't successful in the horse business, but I don't know anybody that's successful that it's, that they don't just work super, super hard. It's, it's, it's an all consuming, it's an all consuming job. It's an all consuming lifestyle. And yeah, I mean, it's, you know, like, as you would know, you have problems with horses. Whether you know about it or not. Every time the phone rings, something can be happening. Horse can be getting pregnant, not being pregnant. Horse can, you know, be doing well, not doing well. You know, they're, they're like, they're like fruit. And at certain point, you know, a horse, you know, they're, they're, the fruit is in a perfect condition and other people want it and when you wait too long or you, or you know, it becomes rotten. It's a really interesting business. You know, we've been able to take out some of the variables because we've invested a bit more in stallions and stallion shares and so on. That's more predictable revenue Because a stallion can breed, you know, X amount of mares for, you know, sort of Y price and you can predict their, and you can predict their revenue over time. And we've been able to, we've been able to make a little bit more sense of that business than, you know, just breeding horses and hope they run well. I think that's, we do that very well, you know, but it can go in cycles. You can have, once in a while you can have three or four horses that look like, you know, you can do no wrong and then it can be years before you have a good one again. So, you know, we've, we've tried to get into a little bit more of the stallion portfolio business as a, you know, as a more of a consistent, you know, to put a little bit more consistency into the business. And that's, that's a big change we've made. And you know, the business in America is probably less of a lifestyle than it is in other parts of the country. It's really a sport in other parts, excuse me, other parts of the world. If you go to Europe and go to a horse race, it has much the same feeling as if you went to a polo match or a three day event or something like that. It's very, very social. Parties or gatherings before, after and so on. I think our business here is much more focused on gambling. People gamble essentially from home where they can have better technology than they can with cash in their pocket and going up to a window to make a bet. And we've diversified a little bit into the business in Europe and starting in Australia. So I think it's, in many ways there are healthier businesses there than we have in the States. We have, we have huge variety of buyers in the States, maybe more depth of market than they might have overseas. But I think the fundamentals of horse racing are probably a little bit healthier in other parts of the world than they are right now in the States. Hopefully we'll get that turned around. But that's kind of some of the things that we've done to try to try to make the business, the horse farm, you know, make a little bit more sense.

Well, Craig, you're, you're going to have to forgive me, I dropped the ball. Let's go ahead and let people know exactly the name of your business and how to find you online and how to follow you. People get fascinated with this because one thing I know about the horse business, the horse racing business, is how fascinating and how intriguing it is and how much you can get caught up in it. You know, that's why I try and keep my distance from it. You know, it's a. It's highly addictive for a person like me who loves horses, too.

So our business is called Glen Hill Farm. G L E N H I L L and then Farm, there's one in California that has nothing to do with us. And they've got the website, and I know we predate them, but I did enough contract, excuse me, enough trademark law when I was at Alberto Culver that I really don't want to go back and fight that. So they've got the. They've got the website, but it's actually. It's called Glen Hill Farm. I'm on Twitter and my Twitter handle is craig c r a I g b1818. And then Glen Hill Farm has a Facebook page where we keep people updated, you know, mostly general public and fans with pictures of our horses, our young babies and so on. It's a really good way to communicate directly with, you know, the consumer and the fan. So we do a bit of that. We're not a public, commercial horse operation. You know, like with Borders, where we. Where we take care of other people's horses and they pay us, so we don't have a ton of direct advertising and a big need to do that. We really, you know, it's a family farm. My family still comes here, My direct family, my wife and my three daughters and I, we come here all the time. But my extended family comes for holidays and so on. So it's in some ways a family gathering place. But for me, it's the. It's the business, you know, and that's. I guess that's. I guess that's where we should have started it. But that's how you can follow what. What I do.

How big is your operation become at this point? What's. What. What is the. What's the size it is? And what's your. What is your goals in terms of size and numbers and. And what, you know, scale of the direct operation that you are running now? You know, like where. When you started in terms of size, what size was it when you took over and. And where is it now? And where would you like to head?

I think it's generally similar in the total number of horses we have. Depending on the time of year, we'll have between 90 and kind of 110 horses. But what we've been able to do is really increase the value of the horses that we have. I mean, a horse, whether They're a good horse or a bad horse, they cost the same to take care of and they eat as much. Their veterinary care is the same. So we've done a good job of upgrading the stock. I get asked that question a lot of what the perfect number of horses are. I mean, you always have too many horses and not enough good ones. It sometimes takes a little while to identify whether a horse is good or not. So if you have a broodmare, which is a female horse that's done racing, sometimes it takes three or four years of production. Where they're producing foals, you're either selling those foals, try to get a return on your investment, or you're racing them, which is more of a long game where you're really trying to build value for that whole female family. And sometimes it can take three or four years before you know if you've gotten a good branch of the family tree or not. So it's every year we call it culling. We kind of, we sell number of horses, try to reinvest that money behind, you know, a couple good ones. If we can sell. If we can sell sort of 16 and buy four with the same money, try to upgrade the stock that way. It's kind of a, you know, the 80, 20 rule that everybody has in every business. We try to follow that, you know, the. Some of this. I don't know if you have people that know horses on the tune into the podcast, but the stallion investment business that we have is called Elevage, which doesn't have anything crazy about the name. It was just a bottle of wine that my partner and I were drinking when we came up with the idea and we were looking for a name. But we've been able to take positions in some really good horses, such as Curlin, you know, who's one of the best stallions in the country now. Like when we bought him, I think he had a. We bought 20% of the horse and he had a 31 million dollar valuation when we bought in. And we still own 20% of the horse. And he probably. We've made a return on our investment every year. And, you know, the value of the horse now would, would likely be sort of 60 or 70 million. We've had plenty that have gone the other way too, you know, but the stallions that we're involved in, and we have positions in Curlin, we have a couple shares and a horse called War Front. He's a very successful stallion. At Claiborne Farm in Kentucky, we have positions in a Horse called Kittens Joy, a large position in him. He's been the number one sire in the country on turf, which is grass racing. So I think for five or six years running. And then we have a bunch of kind of up and coming stallions that we're promoting and trying to make work. And, you know, we combine that business with the business of our sort of long term broodmares, the families we're trying to develop, and then we sell some horses too to, you know, to cover our nut, as much of it as we can. Generally, we try to break even from a cash flow perspective on the farm. When you combine the international business, the stallion portfolio and the farm, and if we can increase the value of our holdings and kind of break even from a cash perspective when you blend the whole horse business together. And we think we had a good year.

So the whole enterprise is run under the umbrella of Elevage Investments. Is that, Is that.

Yeah. So the stallion portfolio is called. The stallion portfolio is called Elevage Bloodstock and the farm is called Glen Hill Farm. So you can kind of find out who we are under both of those, both of those names.

Okay. And I want to wrap up this particular first segment because I like to do these in segments so people can follow and listen to it in chunks as they're driving around and they're going through life. I like to help break it up for them. So in this first chunk, what stood out to me, one thing that stood out that I'd like to get you to comment on one more time and then we'll move over to another thing you said that I want to ask, but you said plenty of people, because these principles, I just hear these same principles that you're talking about. The way you approach logically, your horse business in terms of turning it into a real business, increasing the odds on, you know, making it, build consistency into it. The idea of plenty of people who work hard and aren't successful, but there's no way you're going to be successful without working hard, you know, and it starts with a passion. What would you add to that? You know, what does that really mean that people need to pick up on? That can be. That right there sounds so simple, but that can be a life changing concept for people that are on their way up that you can't ever get away. One thing that can happen, you get challenges. Right now we're all in a snow globe where we're all being shaken up and down the whole world, we're all upside down, turning this, that and the other. But there's certain principles, non negotiables you could never let yourself get away from. If, you know, even in a snow globe, think things eventually settle down. And so when things settle down, if you've gotten away from your beliefs and your approach to life and your activity schedule, you know, you're going to, you know, you're going to be a loser. You know, you're going to have let this thing disrupt your success in life. So talk about when you said that, you know, these things that, that come out that we take for granted. Craig, people don't get, you know, what would you say?

I've always been taught to try to, to try to find a really good boss, really somebody that you look up to. It doesn't matter what you get paid. It doesn't matter how quickly you're moving up in an organization. You really just want to understand how your boss, if you, if you're lucky enough to work for, to be able to pick them or really find a mentor and then learn what goes into their process for decision making. When it's time to hit the gas pedal, when it's time to obviously slow down and kind of view the scenery, you know, when I, when I say, you know, work hard, you know, in my specific business and, you know, it's, it's, it looks glamorous. I mean, people can watch the Kentucky Derby and you see the people in the paddock and it looks great. But there's, there's a lot of hard work that goes in behind that. Taking care of the horses, learning the lineage of the horses, the bloodstock, like their pedigrees, finding patterns, you know, in bloodlines that seem to, the best families seem to repeat themselves. Learning the way horses move. Like I go biomechanically. I grew up in Chicago loving horse racing, but I didn't, I didn't grow up, you know, with my hands and eyes on a horse. So I learned how to read the racing form. I was a gambler when I was young. My grandparents would take me to the track and give me 20 bucks and there was 10 races, dollars a race. And if I blew it, it was gone. And if I, if I won, I got what I could keep. So I learned how to handicap races. I devoured thoroughbred publications when I was growing up and then all of the sales catalogs. Learning about the families when I got in the business full time, you know, I've gotten better at picking out horses, looking at horses, so on, but I've been able to identify people that work for me. That, you know, are expert in that field. I really let them do their job, give me the information, I can decide what they're worth based on their, their, their breeding and then the, the, essentially the potential if they're successful, the downside if they're not. I go to as many conferences that are associated with my business as I can. I said it a few minutes ago, I don't have a business where I'm looking for customers. I think when you can meet somebody and you're not actually trying to sell them something, but you're trying to learn from them, the conversations are much more open and you can really get a feel for somebody else's experience in the business and so on and so forth. Another thing I really try to do, our business is one with everybody has connections and they have family that have association with the business. I think I've done a good job of trying to help people that, you know, don't have family connection to the horse business. And, you know, I'm going to be in the horse business hopefully the rest of my life. And if I can find a few kids that are really motivated, even if I don't employ them, but I try to give them advice, I try to introduce them to people if I know they're going to work hard and not embarrass me, you know, in 10, 20, 30 years, you know, I'll have an army basically of people that, you know, they don't owe me anything and I don't owe them anything. But, you know, you really treat people well before they're in a, in a successful position. And, you know, if you can, if you can find the ones that, you know are going to work hard and stick with it, at some point they're going to be running major operations and you're going to be able to do business with those people. And, you know, it's, it's in our business. You know, we have rich people that come in. You know, they can sometimes they're rulers of countries, like literally sheiks and princes and the Queen owns horses. And you've got people that have sold their businesses for nine or 10 figures that want to jump in and take over the horse business. And I think they, you know, maybe it doesn't matter to them because they've got so much money, but I think that a lot of times they fail because, you know, they like, they show up at the sales and they buy the most expensive, expensive horses and they get their names in the paper. But the only thing that really matters is when your name's in the paper. When you, when you win important races or you can, you can, you can buy horses that, you know, before they've become apparent to everybody else. Buy a horse, you know, maybe before they've won a good race or notice a horse that looks like a fantastic prospect and figure out, figure out, you know, where the mother is or where the sisters are and try to acquire those horses before everybody else understands. The only way you're going to do that in my business is just to be totally immersed in it. And having come from a completely different business, consumer packaged goods, you know, so many of the same principles that I learned there, you know, they directly apply. So all that advice, you know, with whatever career somebody's in, you know, the networking, the really, really engaging the young people, you know, because that's, that's very important. Anybody can kiss ass to somebody that's, you know, the boss's son or, you know, somebody in like a senior VP position. But you may, you build so much deeper relationships with people that, you know, can't necessarily help you that minute. But just somebody that you can teach or you can learn from and so on so forth, just borrow their brain when you, you know, when you have an idea or so on. So that's really what I meant. I don't know if that answers your question or not, but that's, that's kind of how I look at it.

Well, you've done more than answer the question. And I know you've got to run. I want to. Rather than keep going. I'd like to bring you back in a few weeks, a few months if you don't mind and kind of pursue some of these things a little bit more. And you made so many great points about building a business that lasts, building a life that lasts, having an eye on the long term. Thanks for listening to this episode of Million Dollar Mastermind with me, Larry Wydell. If I've helped you in any way, leave us a five star rating and review on Apple Podcasts. For more information like this, listen to our other Million Dollar Mastermind episodes and check out my Wydell Academy YouTube channel and visit us on widelawnwinning.com I'm the million Dollar Mastermind. And until next time, go go.