NEW YORK - The once-sparse landscape of online art sellers has over the past two years become an overgrown jungle of glitzy ventures, big-name backers, and newfangled business models — so much so that it can be hard to remember what, if anything, makes a particular site stand apart from its competitors.
Now into this thicket comes a new site, COMPANY, that is hoping to cut a profitable path by being everything its clients could ever want, and more. It will even have a reality TV show. And the real hook for the site? It's not afraid to break the unwritten rules of the art market.
For people in the greater business world, art commerce is a tricky beast to understand. It's almost entirely unregulated, yet ruled by a tacit agreement between collectors, dealers, and artists that the resale of artworks should be handled with sensitivity, if done at all, for fear of damaging an artist's market. Otherwise, a collector who buys low and sells high, i.e. a "flipper" like Charles Saatchi, gains a reputation for not caring about the artist's well-being, sometimes burning their careers. For this reason resales tend to happen mainly at the higher reaches of the market, whether through auctions or private sales, where the money at stake is high enough for people to violate the taboo.
C.J. Follini, the collector of emerging art behind COMPANY, doesn't think like an art dealer. He thinks like a real-estate investor, which, together with being a venture capitalist, is what made him wealthy. Realizing that there was no space in the market to resell works from his collection — they were not lucrative enough for the big auction houses, and galleries wouldn't touch it for fear of dampening the value of their primary market inventory — he wondered why dealers saw his second-hand art as "used," instead of "available." There are plenty of reasons a collector would want to resell a work that have nothing to do with it being less valuable than it was when they bought it. Seeing an opportunity in the marketplace, Follini and his wife, Renee Ryan, launched COMPANY to bring collectors of emerging art together.
Treating art like a house instead of a car may prove lucrative for Follini. In the five months since launching last March, the Web site has catapulted out of beta into its first phase and is already operating in the black, according to Follini. It has been so successful that plans for the business's future growth has been moved up at least a year since the first projection, and the company just completed a $1.6 million seed-funding campaign to underwrite its growth into two new areas: the art rental market for commercial real-estate firms and major hotels, and the reality television game. The funding came primarily from two angel investors, the Reen Family Office and Ten Paces Capital Partners, which are both high-net-worth families primarily invested in real estate, Follini said. It should be noted that Follini is CEO of the latter partnership, and a call placed to the COMPANY number in the press release was in fact redirected to Ten Paces.
The growth into the art rental business is fueled by Follini's connections to the commercial real-estate world. He told ARTINFO that he knows many real-estate firms and hotels that need to decorate a public space but have trouble finding work that is affordable, aesthetically pleasing, and unlikely to offend. To help solve this particular dilemma, Follini takes a page from the housing book — why buy when you can rent? The rental process won't be in the view of the casual user.
"It's more of a back end thing," noted Follini. "It is not for the non-professional user." Corporate clients will be able to log on and choose works of art which fit in with the decor of their public spaces. They can rent art without having to make a significant capital investment, and the emerging artists gain valuable public exposure.
The second branch of the growth strategy is an already-greenlit TV show. It is part of COMPANY's offline strategy, which Follini believes to be important to any good online business.
"The future of online is offline," he said. The show will air on a local New York City station and feature "art professionals" who will help co-host each episode. Each season will be five episodes, and each will feature a different artist from a different New York City borough. At the end, the hosts and viewers will choose a favorite, who will be rewarded with a solo show for their work.
For the time being, the Web site operates on a model much like some of the Internet's most successful e-commerce sites, like eBay and Craigslist. It takes the diverse sales systems of the art market — art advisors, galleries, and auction houses — and rolls them into one outlet focused on the work of emerging artists. It is a social site bringing together collectors and artists, but the primary draw is a curated secondary market: a place where people can consign and sell work from emerging artists, with "curated" being the operative word. Every piece consigned on the site is selected by a committee made up of the employees of COMPANY — about ten in all — and the process is "completely subjective," according to Follini. If the committee doesn't like it, it doesn't make the cut.
The works that do make the cut generally are priced between $1,000 and $20,000, with $3,000 to $5,000 being the average. There are two ways to sell: directly from the seller, which costs nothing, or through a consignment system, which currently produces most of the site's revenue. COMPANY charges nine percent for the service of making sure the sale goes smoothly — and for turning the art world's handshake niceties on their head.
Site by Artimin
