acfpu seminar on alternative investments - the art of investing in art

Alternative Investment Seminar on Art, 6th September, 2013

Association of Chinese Financial Professionals in UK (ACfPU)

英国华人金融协会

HOW MOBILE AND ONLINE ARE CHANGING THE ART

MARKET

I am CEO at ArtfinderMy name is Jonas Almgren

8 years in New YorkCo-Founder VIP Art Fairand oneartworld.com

15 years in Silicon Valley5 scale-ups: 2 IPOs, 3 acquisitions

Swedish, MSc Computer Science, KTH

HOW MOBILE AND ONLINE ARE CHANGING THE ART

MARKET

WHAT MARKET ?

Gagosian

Hauser & Wirth

Marian Goodman Gallery

L&M Arts

Paula Cooper

High end market

•$30 billion global market

•Tiny group of buyers buying from a tiny group of resellers

•Supply is limited (sometimes artificially)

•It is highly opaque and co-dependent

•It can only be marginally improved by internet

ARTSY

Reproductions market

• $70 billion market

• It is a global market

• It is a mass market

• It has already been disrupted

Middle market

What is the Middle market?•Affordable authentic art the middle and middle-upper class can buy

•$60 billion market

•It is operated by local galleries selling to local buyers

•It has not been disrupted yet

How to approach the Middle market?Sell limited edition prints by high end artists?

How to approach the Middle market?Can we combine authenticity, affordability, and investor value with the rich global choices (including unique paintings and sculptures) afforded by the high end?

Disrupting a market

Pre industrial market

Buyers only buy from the local sellers

Industrial market

Mass production and distribution

Modern market

Efficient marketplace providedby players like Ebay or Etsy

How to approach the Middle market?The Art Marketplace

Trusted Two Sided Marketplace

100 million annual affordable art buyers

1 million independent artists(living from making art)

Efficient global marketWide selectionOnline

High liquidityLittle remnant inventory

A Home for Art OnlineTrusted, Quality, Free Returns

Artfinder TechnologyOnline Website

Curated Marketplace, Beautiful & Responsive DesigniPhone App

In-app Purchases, Notifications

Large Engaged Community

130,000 members

122,000 FB fans

189,000 Pinterest

800 sellers10,000 artworks

• More FB fans than Art.sy, Artspace, Paddle8, and 20x200 combined

• Our FB fans on average engage 150 times with each post

• More than 2 million emails sent every month with high open rates. Notifications sent to mobile app.

The marketbecomes Personal

•Buyers and artists interact

•Artists become marketing powerhouses on their own thanks to social media

•It democratizes the market for artists

•You can be a star by popular demand rather than gatekeeper selection

MOBILE is more than MICROTRANSACTIONS

•A big chunk of our sales happen on mobile apps and we were the first surprised!

•A mobile sale always happens at the right moment, in the right place

•Inhibitions disappear

NOTIFICATIONS are HUGE

•Buyers following their favorite artists

•Buyers following other buyers

•Buyers following taste makers

•Buyers discovering local galleries via apps

•Artists receiving real time feedback from their fan base

How STAR ARTISTS will be born

•The power of gatekeepers will diminish

•The relevance of social network popularity will increase

•What will happen if an artist rises to the high end market? Will he keep operating in this global market with other stock?

How does this affect ART INVESTORS?

•Prices are driven by demand

•It is a liquid market

•Prices can go up or down!ARTIST & ARTWORK

VALUE INCREASE

GATEKEEPERS DEMAND

NEW MODELOLD MODEL

JONAS@ARTFINDER.COM