The Art World

In 2024, the art world generated roughly $58B in revenue compared to the peek in 2014 at roughly $68B. The industry appears to be only regulated for the purpose of money laundering, and of course fraud but not much else. If I sat on the board of a major art institute and found out that there was going to be a solo show of an artist, and the show would travel throughout the world, I could go out and buy some of their art before the first show hits the museum, and although certainly some ethical questions, this does not go under the category of insider trading.

We have been patrons of the arts as long as I can remember. We shlepped our kids to museums and galleries when we traveled, and now as adults, they also have a love for the arts, all art. We started buying art for our homes right out of college, pieces we loved and wanted to live with, and we have continued to buy the exact same way. Call us crazy but we have never purchased art for any other reason although we could have.

I have invested in a handful of companies that have built businesses in the art world, from backend technology to online marketplaces to authenticity verification. It is extremely hard to get an industry to change its behavior, which is extremely siloed and proprietary.

Just like all businesses over the past few decades, it is always about growth. Galleries have become chains, or exist in multiple markets, casting a large net of artists in their rosters. The ever-ending art shows across the globe are expensive to participate in. The rent of most galleries in urban cities is not inexpensive either. And most importantly, we do not have to be in person to see art anymore.

One can scroll, find artists across the globe, making a physical location is not as important. That access wipes away the secrecy that galleries like to live in. This access has had an impact on “blue chip” artists and their prices that have been jacked up by the gallerists in order to survive, and grow, in this industry.

I have been reading countless articles about the declining sales in the art world, and Tim Blum, the gallerist of Blum and Poe, who recently called it quits, described the situation best. He said, “This is not about the market, this is about the system”. So the question is obvious: how do we change the system?