tag:blogger.com,1999:blog-3057826380522065501.post591406915922553870..comments2023-12-28T23:27:33.142-05:00Comments on DLK COLLECTION: A Contemporary Photography Investment VehicleDLKCOLLECTIONhttp://www.blogger.com/profile/14875914464454488384noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-3057826380522065501.post-58693033727246155662010-05-15T19:32:26.797-04:002010-05-15T19:32:26.797-04:00what is missing in the art market is a tool to me...what is missing in the art market is a tool to measure the price of an artist , because this is what is primarily sold "the name of the artist ", the bigger the higher the price is , so if there was a tool that could somehow measure transactions of a single artist at each given moment around the globe the market for fine art photography would be a much more reliable market to invest for example let's say i like a specific photograph of roger ballen i would like to see what is the range of his previous prices so that i have a measure of comparison with the price the gallery gives ,i think that if this is somehow solved then the problem of liquidity would dissapear ...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-66250751847005176152010-05-14T16:14:28.637-04:002010-05-14T16:14:28.637-04:00I've gotten a couple of pointers to the Art Ph...I've gotten a couple of pointers to the Art Photography Fund, run out of Austria and focused on vintage photography (it sounds like). Gallery owner Johannes Faber is involved.<br /><br />The site is here:<br /><br />http://www.artphotographyfund.com/<br /><br />There is a podcast with one of the managing directors here: <br /><br />http://www.arttactic.com/podcasts.php?showall=1&category=6DLKCOLLECTIONhttps://www.blogger.com/profile/14875914464454488384noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-68938871770357037432010-05-13T14:35:57.224-04:002010-05-13T14:35:57.224-04:00Here's a link to the 2007 NYT article referred...Here's a link to the 2007 NYT article referred to by Anonymous (JB):<br /><br />http://www.nytimes.com/2007/07/13/business/worldbusiness/13exotic.html<br /><br />The fund seems to have started with WMG and gone over to Toscafund at some point, and seems to have still existed in 2009. I couldn't verify that it still exists today, though all I had to work with was google results.<br /><br />At the very least it's an interesting footnote to the history of photography.John Legweaknoreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-16442352143029883782010-05-13T13:27:12.555-04:002010-05-13T13:27:12.555-04:00Very interesting post. A number of art funds have...Very interesting post. A number of art funds have been started over the years, of course, and as other comments have noted, the fees, overhead and so forth pose a big problem, as does the illiquidity and lack of transparency in the marketplace. I always think that it is the sign of a top when these art funds start proliferating and getting a lot of press. I can only think of one, The British Railway Pension Fund, which had a documented positive return (and the political grief it caused was considerable).<br><br />Nonetheless, this is a very valuable thought exercise indeed and I think serious collectors and acquisition committees should take note...thank you.JayGnoreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-28714806534474789702010-05-13T09:58:42.908-04:002010-05-13T09:58:42.908-04:00I think John gets at one of the key questions that...I think John gets at one of the key questions that would need to be answered definitively before one could go forward: how many 10X winners are there in the contemporary photo market on average? Or how many have there been in the past 5 years, say? I haven't done the pencil work, so I don't really know. Intuitively, I'd like to think there are enough to generate the returns needed, but I haven't got the proof one would need to actually convince potential investors.<br /><br />Other overnight readers have touched on the other obvious pitfall: the relationship between the small size of the fund and the costs/fees. The costs have to be managed to a minimum or the fund infrastructure will overwhelm the underlying assets, driving down returns. Maybe there's a way to defray some costs by being under the umbrella of a gallery, where costs could be shared. And the fund size needs to be optimized to be reasonably large (meaningfully larger than the 1M I used for illustration purposes), without becoming too large of a market player that it becomes hard to unwind its investments. <br /><br />As with any fund, the devil is in the details. Is there a capital model that can make it work? And are there enough oppotunities to warrant the effort? These are the questions that would require intense investigation to get such a vehicle beyond the pie in the sky stage.DLKCOLLECTIONhttps://www.blogger.com/profile/14875914464454488384noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-31121120291458470512010-05-12T23:42:20.725-04:002010-05-12T23:42:20.725-04:00One strategy that surprisingly hasn't been men...One strategy that surprisingly hasn't been mentioned yet is to stock up on older, established photographers who aren't likely to have too many years left then sell after they die. Sadly, I think this is a strategy that some collectors actually follow.<br /><br />Another strategy would be to buy portfolios instead of individual prints since this tends to be a cheaper way to by on a per-print basis.BChttps://www.blogger.com/profile/18168711407154404366noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-42473705695167767032010-05-12T20:05:41.494-04:002010-05-12T20:05:41.494-04:00I’m not a collector but I read your blog all the t...I’m not a collector but I read your blog all the time and really enjoy it. From an investment standpoint I think it’s fair to view art photography as a sector within the art market. My question for you would be, do you view this sector as healthier or richer in growth potential ("hotter") than other sectors within the broader market, particularly contemporary painting, or is it simply a sector you’re devoted to and know well enough to be confident in your picks? I’m wondering in particular how frequent and big the home runs are likely to be in emerging photography vs. emerging painting.John Legweaknoreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-20533479535432746772010-05-12T18:17:42.045-04:002010-05-12T18:17:42.045-04:00Indeed, just like in venture capital, you'd be...Indeed, just like in venture capital, you'd be expecting to fail with 8 of the 10 emerging photogs and reap big enough rewards from the other 2 to cover your losses. <br /><br />Yes, where are the patrons these days...?J. Wesley Brownhttps://www.blogger.com/profile/13978967238356104467noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-47599737548808773342010-05-12T17:19:41.293-04:002010-05-12T17:19:41.293-04:00Let me know when you set-up the fund. I'd like...Let me know when you set-up the fund. I'd like to invest.rcpnoreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-87077354192857702142010-05-12T15:30:42.339-04:002010-05-12T15:30:42.339-04:00I think Wesley's idea heads down the road of t...I think Wesley's idea heads down the road of the Medici patron model, only updated for the 21st century. It could certainly work that a fund could purchase the rights to a stream of income from work produced, in addition to "adding value" through supporting the artist's career. <br /><br />If you think of the structure I originally outlined as a "mid stage" fund, it is also possible to do a "seed stage" fund, by buying work from MFA shows and the like. In this case, the percentage returns might be higher - a $500 piece goes to $2500, but the ultiamte failure rate will also be larger. In the mid stage fund, the "cash on cash" returns would likely be higher - a $50K Ruff later sells for $100K, and the downside is a bit more protected. <br /><br />There are clearly lots of potentially viable ways to do this...DLKCOLLECTIONhttps://www.blogger.com/profile/14875914464454488384noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-6691014621538310712010-05-12T15:02:23.339-04:002010-05-12T15:02:23.339-04:00Music to my MBA ears. Now, I've often wondere...Music to my MBA ears. Now, I've often wondered about the venture capital itself and how it could work for a photographer / investor vs. the fund you discuss. Could someone invest in the whole body of work, or all future earnings by an initial investment and then career guidance, management and promotion? I'm talking about a hard equity and not an agreement like the galleries have.<br /><br />Someone with experience and connections sees promise in a fledgling photographer and invests with a managerial / board member role and then when the value of the work rise, that stake could in turn be sold back to the photog. or to another interested investor. <br /><br />I know, it sounds evil but interesting to ponder.J. Wesley Brownhttps://www.blogger.com/profile/13978967238356104467noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-3092847324967176462010-05-12T13:50:22.731-04:002010-05-12T13:50:22.731-04:00I think Gabriel's observation is mostly a quir...I think Gabriel's observation is mostly a quirk of timing, and the global diversification would likely somewhat even out in the long run. For example, in 2010, there have been 9 contemporary "selling" shows so far that received 2 or 3 stars, with a slightly better mix of international photographers. They were:<br /><br />Deal, Eggleston, Maisel, Misrach, Miyamoto, Parr, Ruff, Struth, Tillmans<br /><br />And we still have the rest of the year to see what else surfaces before choosing the 10 or so in the "best of 2010" basket.<br /><br />I do believe from a liquidity standpoint that the photographers chosen need to have a presence in the major photography markets, which likely does mean coming through NY at some point.DLKCOLLECTIONhttps://www.blogger.com/profile/14875914464454488384noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-8805133665347530352010-05-12T11:52:18.415-04:002010-05-12T11:52:18.415-04:00Fascinating idea, I would only add international d...Fascinating idea, I would only add international diversification to the basket, as you have 7/10 Americans in your list (8 if you count Ballen). Unless, that is, you assume that whatever's good anywhere else will eventually make it to NYC (this assumption would in itself make for an interesting discussion).Gabriel Benaimhttps://www.blogger.com/profile/10023922898706307650noreply@blogger.comtag:blogger.com,1999:blog-3057826380522065501.post-54414698328062109252010-05-12T11:50:09.803-04:002010-05-12T11:50:09.803-04:00See Zelda Cheatle's fund mentioned in July 200...See Zelda Cheatle's fund mentioned in July 2007 NY Times article for existing photography portfolio investment vehicle,<br /><br />JBAnonymousnoreply@blogger.com