Seth Klarman grew up three blocks from Pimlico Race Course on Whitney Avenue in Baltimore, close enough to walk across Northern Parkway and into the gates at the place they call Old Hilltop.
He regularly attended the Preakness Stakes in those days, especially so in the 1970s and watched from the infield as legends like Secretariat and Affirmed etched their names into the history books with victories in the second jewel of the Triple Crown. Klarman dreamed of one day being there and winning races – any races really – and especially the biggest prizes in America.
A long successful career as a long-term value investor provided the means for Klarman to go after that dream. Funny thing about dreams though. As anyone involved in racing will tell you – from Arab sheikhs to European billionaires to American businessmen – the means don’t always guarantee success.
The means combined with sound decisions and talented horsemanship can certainly help and they did Saturday in front of 140,327 at Pimlico as Cloud Computing upset the field in the 142nd running of the Preakness Stakes.
Raced in partnership by Klarman in the name of his Klaravich Stable with longtime partner Bill Lawrence, Cloud Computing won by a head over last year’s champion 2-year-old Classic Empire in a pitched stretch run with Kentucky Derby winner Always Dreaming a disappointing eighth in the field of 10.
“I grew up right here, on Whitney Avenue, and this is the first place I went the races,” Klarman said, on his way through the infield at Pimlico on his way to the airport. “I remember being here for Secretariat, Bee Bee Bee, Affirmed, horses like that. Obviously that’s a lot in the ‘70s.”
A few moments earlier during the post-race press conference, with the base blaring from a party inside The Stronach Group’s tent just past the finish line, Klarman further explained his early interests in racing.
“I started out as a teenager handicapping, enjoying the races, enjoying the athletic performances and enjoying the puzzle of trying to figure out who might win a race,” he said. “As an adult I was offered the opportunity to participate in a small partnership and gradually became an owner about 25 years ago. And this is the culmination of 25 years of hard work and learning to try to figure this game out.”
Chad Brown, who trains Cloud Computing, has also spent his lifetime trying to figure out and win in the racing world. He’s done a lot in a short amount of time, winning both the Eclipse Award as North America’s outstanding trainer and the coveted Saratoga training title in 2016, but he’d never won a classic from limited attempts.
Brown could have attempted to win the Kentucky Derby two weeks ago with Cloud Computing since the son of Maclean’s Music earned enough points to earn a starting spot in the starting gate, but opted to bypass the race and wait for the Preakness. He ran Practical Joke in the Derby, finishing fifth behind Always Dreaming, in his fourth attempt in America’s great race.
Cloud Computing fit the second jewel of the Triple Crown a bit better, Brown said, liking the six-week gap between his third in the Wood Memorial and the smaller field for a colt who was unraced at 2 and only raced three times in his career.
“We always liked this horse as a 2-year-old,” Brown said. “He got injured up at Saratoga. … So we rested him and Seth and Bill have always been extremely patient with their horses, no rush and do whatever is best for them to do. We knew he was good right away. How did we know he was this good? Preakness good? I’d say in his second start in the Gotham, when he was kind of chasing a fast pace and then made another run in the lane, he just never quit.
“We huddle up and said, ‘this horse is really special and he can go that far. How do we get to the Derby?’ It just didn’t work out in the Wood. We just ran out of time. Looking back on it, it was a bit of a speed biased track that day, and he was one of the only horses that closed ground.”
Javier Castellano, winning his second Preakness following eventual champion Bernardini in 2006, rated Cloud Computing in a perfect spot to close ground in the Preakness. The two raced third down on the inside while Always Dreaming and Classic Empire threw down the gauntlet early, making true on many observer’s belief that the Preakness was indeed a two-horse race.
Cloud Computing stayed in that spot most of the trip while Always Dreaming cut through fractions of :23.16, :46.81 and 1:11 over the slowly drying out track. Always Dreaming threw in the towel first, looking tired around the far turn as Julien Leparoux and Classic Empire engaged him turning for home.
Leparoux cracked Classic Empire with a strong right hand into the lane and last year’s Breeders’ Cup Juvenile winner surged past Always Dreaming and into a clear lead. Castellano stayed busy on Cloud Computing, never panicked and drew on even terms with Classic Empire a sixteenth of a mile from home. The two raced side by side briefly before Cloud Computing edged clear in the final jumps. He won by a head and it was 4 ¾ lengths back to longshot Lexington Stakes winner Senior Investment in third, with Derby runner-up Lookin At Lee fourth. The final time was 1:55.98.
“I had a lot of confidence in the horse,” Castellano said. “I spoke to Mr. Brown before the race and we had a plan. We’re sticking to the plan. It worked out great. We analyzed the race, we handicapped it together. We had a lot of talks. So we put it together, and I think that’s the most important thing in a relationship when we have great communication. That was the key to win the race.”