Whitehot Magazine
"The Best Art In The World"
By SHIREEN LOHRASBE, SEPT. 2014
2014’s THIRD QUARTER MARKED SEVERAL MAJOR deals for the online art market. TEFAF’s “Art Market Report 2014 – The Global Art Market” released in March, projected the virtual art trade to reach $13 Billion by 2020. This $13B estimation is widely referenced in these new mergers that follow in the footsteps of Amazon Art (which launched in 2013 to lukewarm reviews).
US-BASED DEMAND MEDIA INC. (NYSE: DMD) purchased Saatchi Online, Inc. that includes Saatchi Art—an online platform which represents 45,000 artists from 95 countries. According to Demand’s site: “The company was acquired for total consideration of approximately $17 million comprised of a mix of cash and stock. In the near term, the company expects this acquisition to contribute revenue of $0.5 million to $1 million per quarter and reduce adjusted EBITDA by $1 million to $1.5 million per quarter.”
PUBLICALLY TRADED SOTHEBY’S (NYSE:BID) and eBay (NASDAQ:EBAY) announced a new partnership mid-July. With 18 collecting categories, the online platform will stream Sotheby’s New York auctions live on eBay's site (evening sales not included). The collaboration combines the auction house’s lengthy expertise dating back to 1744 and eBay’s 145 Million active buyers worldwide.
IN JULY, PUBLISHING COMPANY PHAIDON (owned by private equity titan Leon Black) accquired Artspace—a leading online art sales startup—for $120 Million. This expands Phaidon’s online portfolio to comprise of fine art (offered in the range of $100—$100,000), and better positions Artspace against its main rivals Artsy and Auctionata. Just prior to the acquisition, Artspace raised $12.2 million from venture capital investors.
ARTBINDER—A MOBILE APP FOR GALLERIES—raised $3.17 in Series A round led by Index Ventures. The funds are designated to product innovation and expansion including a new iPad app. Launced in 2011, ArtBinder’s early investors include: Paypal’s Bruce Gibney, Phaidon’s Leon Black, former Facebook VP Product Matt Cohler, former Etsy COO Adam Freed, and 1stDibs CEO David Rosenblatt.
LATE JUNE/ EARLY JULY MARKED LONDON’S contemporary evening sales. Mary M. Lane at The Wall Street Journal detailed: “The art market split in two at London's contemporary evening sales this week, with mediocre material from star artists and midrange artworks faring disappointingly while rising new names received hectic bidding. The weeklong series saw auction house Christie's powering ahead of arch-rival Sotheby's BID -0.23% with $170 million worth of sales, including seven world records, against Sotheby's $158 million. The week's most expensive artwork, offered by Sotheby's, was Francis Bacon's 1964 triptych 'Three Studies for Portrait of George Dyer (on Light Ground)', which went to a European collector for $45 million.”
MID-JULY WELCOMED TWO SIMULTANEOUS FAIRS in the Hamptons. The 4th edition of artMRKT Hamptons presented forty US-based galleries in contemporary and modern art (sales figures have yet to be released). Concurrently, the 7th ArtHamptons presented over 3,000 artworks, with 14,000+ projected in attendance. And the following week Art Southampton, presented by Art Miami, attracted a record 21,000 visitors to its 100,000 square-foot pavilion. The fair hosted 80+ galleries from 43 countries repping 660+ artists.
THE 5TH EDITION OF ARTASPEN ran July 31–Aug 3. This year the four-day fair drew 2,650 visitors, a 10% increase in attendance from 2013. “Limited in size to just 30 dealers, this intimate and impeccably designed setting provides fairgoers an elegant and manageable viewing and buying experience. It is the ideal setting for both art dealers and art collectors to meet and mingle while experiencing the most dynamic marketplace for important art, ranging from 1950-present.”
IN MID-JULY, CHRISTIE’S RELEASED ITS half-year statistics. So far, the auction house has conducted $4.5 billion in sales, up 12% from 2013; 51 works (from all categories) sold for $10 Million+, 482 for over $1 Million. The auction house has seen a 71% increase in online transactions thus far and new clients account for 24% of buyers. For the Post-war Contemporary category, the press release read: “[PwC] had a record breaking six months with total sales of £799.9 million ($1.3 billion) up 20% on the same period in 2013 (30% in $).” By region, New York sales increased by “20% to £1.1 billion ($1.76 billion, up 31%). Sales in EMERI totalled £872 million, up 12% ($1.45 billion, up 22%). Asia sales declined on the same period to £254.7 million, a decrease of 8% ($422.8 million). Sales to clients in Asia grew to 28% of overall activity, and 20% of all new clients to Christie’s were based in Asia. Buyers from Greater China accounted for 24% of total sales, a spend increase of 46% on first half 2014.”
COMPARATIVELY, SOTHEBY’S HAS SEEN a 24% net increase in auction sales for the first half of 2014 at $2.7 Billion. Also, first-time clients make up 26% of buyers this year thus far. Though private sales dropped by half in earnings (more works were sold for less money this year), the Asian market sector grew. Sotheby’s Hong Kong and Beijing sales increased 56% accompanied by a “35% increase in the number of buyers from Mainland China in Sotheby’s auctions globally.” Other categories such as Imp-Mod grew by 21% over the same period in 2013.
Shireen holds a BBA in Design & Management from Parsons The New School for Design and an MA in Art Business from Sotheby's Institute of Art, New York. She has contributed to several online publications including Art Observed, Quintessentially Art, and Whitewall Magazine. Shireen is a regular art market contributor at Whitehot Magazine.
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