Working the wind

Once mostly a proving ground, the Sydney to Hobart yacht race is now also a stomping ground for Australia’s business elite

The Sydney to Hobart yacht race is outsized in every sense, from the distance it covers to the bank balances of many of its participants.

In its 55-year history, the race has attracted more than its fair share of BRW Rich 200 members past and present: Bob Oatley, Neville Crichton, John Kahlbetzer, Denis O’Neil, Peter Kurts and Alan Bond, to name a few.

A mixed roll-call like that raises the question: can owning or even getting a spot on the crew of a Sydney to Hobart yacht benefit your business?

There are certainly easier ways to get to Hobart, just as there are also cheaper ways to experience some of the conditions you’re likely to encounter en route.

“Have buckets of 12-degree water thrown at your head for three days straight” is a faithful way of bringing the Sydney-Hobart into your home, one experienced participant says.

Why then do those three days in December spark such passion from those who have experienced them?

“I like the long races. They’re tactical and they require stamina,” says 84-year-old Syd Fischer, a veteran of 42 Sydney to Hobart races, most of which he has sailed on one of the eight yachts he has owned named Ragamuffin. Fischer has secured line honours in the race twice, and handicap honours once during the 37 Sydney-Hobarts he has completed.

He is also a successful property developer and a once perennial candidate for inclusion in the Rich 200.

Although it’s the thrill of the race that keeps Fischer coming back, he admits the Sydney to Hobart experience is not such a bad thing for business either. “Running a team is great training for business – you’ve got people to handle and you’ve got circumstances changing all the time, and you need to be able to cope with that. That’s what business is really about.”

For other entrants, like Neville Crichton, the link between participating in the Sydney to Hobart and business is much more pronounced.

Crichton is a former member of the Rich 200, with a wealth estimated to have peaked around $200 million. He also is an enduring identity on both the Australian and international sailing circuits, taking line honours in the Sydney to Hobart on two occasions (in 2002 and 2009).

For Crichton and his sponsor Alfa Romeo, the Sydney to Hobart race was an integral part of a co-ordinated campaign that brought in upwards of $40 million of PR exposure annually for the Alfa Romeo global brand. “[The Alfa Romeo sailing team is] totally a business deal; the more races we win, the more publicity we get, and the more sponsorship we get,” Crichton says.

As a marketing initiative, he says, winning the Sydney to Hobart appears to be one of the most effective out there.

“We got five front-page newspaper photos after winning the race [in 2009]. Money can’t buy that sort of exposure.

“When the financial crisis hit in 2008, Alfa Romeo stopped their motor racing team before they stopped their sailing team.”

Crichton reckons his involvement with the sailing team has also been a boon for his own business interests. As founder and owner of Ateco Automotive, the Australian distributor for Alfa Romeo, Fiat, Maserati, Ferrari and a swag of other car brands, Crichton believes that his sailing interests were crucial in securing several key contracts for his business.

“The contacts that you generate from the sport open up doors for you. Without our sailing involvement, we wouldn’t have secured the Ferrari franchise,” Crichton says.

For multimillionaire accountant and fledgling ocean racer Anthony Bell, Crichton represents a lot of what can be achieved on the water.

“I first raced against him in 2009 and made it my purpose to go and meet him and get to know him. He knew how to run a boat and run a racing team,” Bell says. “I look at him as someone who knew how to do everything you could in the sport.”

Crichton now acts as a mentor to Bell, providing crucial advice on how to manage Bell’s own Sydney to Hobart campaign on 100 foot super yacht Investec Loyal.

Unlike Crichton’s campaign, which formed a crucial plank of both Ateco and Alfa Romeo’s business strategy, Investec Loyal is a charitable venture, raising money for groups such as the Humpty Dumpty Foundation, which provides children with medical equipment and help.

The Loyal campaign involves former Wallabies players, television hosts and other Australian celebrities getting sponsored to team up with professional sailors to brave the journey south.

Behind the smiles and media-friendly spectacle of seeing the likes of Olympic swimmer Geoff Huegill and boxer Danny Green finding their sea legs in the midst of the roughest race in the country, it’s an initiative that has raised almost $3 million since its first race in 2009.

At $500,000, Investec Loyal’s campaign doesn’t run on a pittance, but it runs on a shoestring compared to those of Alfa Romeo or Wild Oats IV, owned by billionaire Hamilton Island owner and winemaker Robert Oatley.

“We’re a different sort of campaign – we’re aspirational and we do it for charity.” Bell says.

Neville Crichton maintains he didn’t put on one new sail for the 2009 Sydney to Hobart, in which his super maxi, Alfa Romeo, beat long-term rival and sister yacht, Wild Oats IV. The win, however, came at the end of a competition season that Crichton estimates to have cost in the vicinity of $3 to $5 million.

“We just used what we had been using throughout the rest of the season. But it really depends on what you’re prepared to spend.”

Insiders speculate that rival Wild Oats IV’s campaign would cost more than $3 million for a Sydney to Hobart race alone. A big sum it might seem, but it’s one that stacks up when you look at the costs of some of the components.

Michael Coxon is managing director of North Sails, and sailmaker to both Crichton and Bell’s Investec Loyal. He says a “launching inventory” of sails for a boat of Alfa Romeo or Investec Loyal’s size costs upwards of $1 million.

“You’re looking at anything from $75,000 to $180,000 per sail, depending on what you use it for. But campaigning costs go up from there.”

Coxon says that a super maxi yacht running a “top of the line, grand prix racing, nothing- spared campaign” would expect to replace one to two sails per regatta. Then there’s the other equipment, which is just as costly. A fully automated carbon-fibre winch, of which you’ll find about six aboard Alfa Romeo, will set you back more than $30,000. A simple pulley – or a “block” as they’re known – big enough to handle the loads of a super maxi yacht seem like spare change at $1000 apiece.

And this all comes before you factor in the full-time crew needed to keep the boat operating in top condition. “If you’re wanting to run a professional campaign you’re looking at running costs that equal about 10 per cent of the launch value of the boat. So if you’ve got a $15 million launch cost, then you’re looking at least $1.5 million for the year,” Coxon says.

And the big sums don’t just apply to the super yachts.

Jim Cooney is the current owner of Brindabella, the 79-foot maxi that was built and owned by Rich 200 alumnus George Snow. Built in 1993, the yacht completed the race 12 times with Snow at the helm, securing line honours twice, in addition to setting a slew of east coast race records throughout the 1990s.

As a businessman, Cooney has shown some serious form himself, heading up TCI Renewables, a company developing renewable energy infrastructure projects throughout the United Kingdom, Ireland and North America.

He bought Brindabella in 2009, “not as a move to get into ocean racing, but as an opportunity to own a wonderful piece of history.”

Restoring the boat to its former glory after years of neglect hasn’t been a cheap exercise.

“Its cost us about $500,000 for two Hobart campaigns, but that’s not a fair reflection of a cost per race,” Cooney says. “We’ve spent a fair bit rectifying some years of low maintenance. We’ve had to buy new sails, and there’s a whole lot of new gear.”

Cooney is notable as a maxi owner for a campaign that isn’t backed by a corporate. While Bell, Crichton and others such as Bob Oatley are able to finance their campaigns through commercial sponsorship, Cooney receives none of the positive flow-on effects like tax deductibility and brand exposure of a corporate-backed sailing campaign.

That doesn’t seem to faze Cooney, however, who’s in it to “restore the name” of a yacht that is widely regarded as a darling of Australian ocean racing history.

“It was fairly easy to become known once I’d bought [Brindabella]. The boat already had such a profile, and there was so much support for restoring the boat to do her best,” he says. “The name deserves the race.”

In any case, it’s not necessarily the deepest pockets that win. A healthy bank balance may help, but it won’t guarantee you to get over the line first or even finish.

Fischer has been forced to turn Ragamuffin back ive times before crossing Bass Strait. “We lost the mast one year. Another time we dived off a big wave in 65 knot [winds] and the boat dropped on its side into the trough. We virtually ruined one side of the boat.”

Deep pockets may afford you a fast ride, just as they can help you assemble a first-rate crew. But little can be done to tame Bass Strait.

Since 1998, the Sydney to Hobart has been haunted by the spectre of the six lives lost in the race, during a squall that whipped up hurricane-force winds and waves as high as houses. The race may have morphed into a magnet for the most determined of Australia’s business elite, but it is still a pursuit that carries a measure of risk.

Investec Loyal, in its former life as Maximus, had a dark day when its mast crashed down, injuring six crew members, three critically.

Bell himself had a hair-raising experience in 2010 when he went forward to change some sails during very big seas. “I thought I was close to going into the water – and all I could think was ‘there are three things I need to do with my epirb [beacon] before going in the water, and I can’t think of any of them right now’.”

But for some entrants, there’s nothing like the feeling of the wind in their hair. “Everyone thinks ‘what the hell am I doing this for?’ when they hit rough seas,” Syd Fischer says. “But I suppose you think about the good parts and forget the bad parts. I don’t dwell on any of it. I just think the race is a good thing to do.”

BRW

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