Happy Wednesday,
Jake and I are on the ground in Louisville this week as part of the Churchill Downs social media team for the 152nd Kentucky Derby. I'm making TikToks while Jake is organizing the terabytes of footage that flow through from 10-15 photographers and videographers throughout the week. We wanted to use our experience here to tell you what this thing actually is as a business.
This week on Sportonomics, we went solo to discuss the full history, traditions, betting, and business of the Kentucky Derby.
375,000 attendees over Derby Week. The Churchill Downs Inc CEO called it 'five Super Bowl crowds over eight days.'
How They Got Here
1875: Meriwether Lewis Clark Jr. (grandson of explorer William Clark) builds Churchill Downs. First race draws 10,000 spectators. 13 of 15 jockeys are Black. Black jockeys win 15 of the first 28 Derbies.
1895: A 24-year-old draftsman adds the Twin Spires to the grandstand. No symbolic meaning. He just felt the roofline needed something.
1902: Colonel Matt Winn takes over and turns the Derby into a national event.
1938: The Mint Julep becomes the official drink. The souvenir glass tradition starts by accident since fans kept stealing the commemorative water glasses. CDI leaned in, and now, 700,000 are produced annually.
Today: Churchill Downs Inc. ($CHDN ( ▼ 0.87% )) is publicly traded on NASDAQ, generated $2.93B in revenue in 2025, and posted $383M in profit — up 7% YoY.
The Big Idea: Two Minutes of Sports, (Basically) Infinite Content
The Derby has a fundamental problem: the race is two minutes long and only happens once a year. By every conventional logic, it shouldn't work at the scale it does.
Yet somehow, $349M is wagered in a single day, and it has a bigger TV audience than the Masters, the Indy 500, and the Daytona 500.
CDI's solution wasn't to make the race longer. It was to make everything around it worth showing up for:
The garland of 554 hand-sewn roses
The hat competition that doubles as a fashion show
The post position draw that shifts betting odds in real time
The sound of 100,000 people hitting the homestretch
In 2025, that formula went fully digital. Influencer Griffin Johnson became a fractional owner in a horse named Sandman, documented his week on TikTok, and generated 212M+ impressions from 51 posts. Comments flooded in from 18-26-year-olds watching the Derby for the first time.
That's the template: own the two minutes and build a universe around everything else.
5 Tactical Takeaways
5 Tactical Takeaways
1. CDI makes more money from tickets than from betting. Decades of investment in premium hospitality (Millionaires Row, tiered access, sponsored experiences) now outpace the wagering handle as a revenue line.
2. Pari-mutuel betting is why horse racing stayed legal. You're betting against other bettors, not a house. All money goes into a shared pool, divided among winners after the track takes its cut. Same legal logic as fantasy football. Col. Matt Winn championed this model in 1908.
3. Post position matters more here than almost anywhere.
Post 5: 10 winners since 1930, ~10.5% win rate
Post 17: never produced a winner in 40+ attempts
The draw is a genuine news event; odds shift the moment it happens
4. Fractional ownership is how horse racing solves its audience problem. Griffin Johnson didn't go viral because he made good content. He went viral because he genuinely cared about his horse. That's what the "A Stake in Stardom" program created: skin in the game.
5. CDI is playing a long game. A $280-300M capital project breaks ground after Derby 2026. They bought back $425M of their own stock in 2025. The CEO says the Derby is in its third inning. Given that it's a 152-year-old event, I tend to believe him.
Why It Matters
Nothing here happened by accident. The roses came from a party in 1883, the Twin Spires came from a 24-year-old with a feeling, and the souvenir glasses started because people kept stealing them. Every tradition has a story, and every story has been deliberately amplified into something bigger.
That's the lesson: you're not just building a product, you’re building rituals people want to be part of. The Kentucky Derby figured that out 152 years ago.
I’ll have more from inside Churchill Downs in Friday's Bottom of the Ninth.
See you then,
Tyler & Jake