The Emergence Of Art-Tech Startups
A growing number of art-centric technology startups have recently emerged, injecting new methods of operation and providing a new set of tools for creating, protecting, viewing and completing transactions in the notoriously static and antiquated art world. Much like industry sectors such as fintech, reg-tech, or med-tech, a rash of startups that could be labeled as falling under the umbrella term of “art-tech” have emergence recently, and these businesses seek to solve a number of issues that have historically caused problems for artists, collectors, and other art industry players.
The number and area of focus of art-tech companies that have emerged recently vary widely, in a series of upcoming posts, I am going to provide overviews on some of the areas that have recently received a fair bit of attention from investors, creators, and other interested parties in the art world. I am going to begin this series by discussing a new series of ventures that are working to increase transparency to the pricing of art, which is an aspect of selling and purchasing art that is notoriously opaque.
For a number of reason, the price of art works is often much less clear and easy to access as the price of almost any other class of goods. This unique aspect of the art world is exemplified by a typical visit to an art gallery in America’s visual art mecca, New York City. Despite a New York regulation (New York New York City Administrative Code, Subchap. 2 – § 20-708) requiring the price to be conspicuously provided on or near all consumer goods, except those featured in a window display, one is rarely going to stroll into a New York City gallery and find a fixed price amount listed next each art work. The fact that this regulation is rarely, if ever, enforced in New York is but one example of how the art world, which is one of the least regulated industries in the world, operates by its own set of rules, regardless of laws or regulations that would seemingly apply to art just as much as they would to any other industry.
The lack of openly-available price information for art works has been attributed as a factor of the reluctance and uncertainty often experienced by people who are looking to begin purchasing or collecting art. In order to alleviate this barrier to entry for new collectors, a number of startups that hope to increase price transparency have recently formed so that buyers may feel more comfortable about taking the leap and beginning the shift from simply being art fans to art collectors.
Magnus: “The Shazam for Art.”
One company that is seeking to address this is issue is Magnus, an app that describes itself as “Shazam for art.” Magnus received increased attention earlier this year when avid art collector and Oscar winning (finally) actor Leonardo DiCaprio invested in the New York based project that was founded in 2013.
The app, which is free to download and use, allows users to walk into a gallery, take a picture of a piece of art, and instantly receive information about the work, such as title, artist, a history of past sale price(s) for the work, and the current price for the work. The app crowdsources its pricing information and can include price information about both primary and secondary market transactions. Although information may be incomplete or unavailable altogether for certain works one may find in a gallery, the app’s website currently states that it returns relevant information on about 70% of the works that people attempt to use it for, and the project’s team is always working towards expanding the library of information available through the app to its users.
According to an interview with Vanity Fair from earlier this year, its founder, Magnus Resch (after whom the app is named), Collectors love [the Magnus app.] They have to pay for the information that they get from our app for free. They take a picture and they get all the information—information that they’ve never had before. It’s changing the art market.” If you would like to learn more about Magnus, you can access its website at the following link: http://www.magnus.net/about/.
[Screenshot of Magnus]
ARTBnk: Real-Time Valuation (“RTV”).
A more recently launched project seeking to increase the availability of pricing information for art works is the Portsmouth, New Hampshire-based company, ARTBnk, which was founded in 2016. Although still in its beta phase (you can request access on the ARTBnk website: https://www.artbnk.com/), ARTbnk is moving towards a full release of its software as a service that provides real-time valuation for works of art. ARTbnk’s software uses a combination of emerging technologies, including image recognition, artificial intelligence, and machine learning to increase transparency in the art market. Rather than crowdsourcing its information like Magnus, ARTBnk has internally gathered and curated the underlying database of information that its real-time valuation relies upon. The company already has almost 40 people on the team it has put together for this venture.
From the ARTBnk website: “’Right now, there are no standards in the art market, leaving everyone susceptible to the consequences of poor, deceptive, or out of date information,’ said Co-Founder and Chief Executive Officer Robert J. Steinberg. ‘ARTBnk’s proprietary RTV algorithm solves the problem, alleviates this disparity, and empowers our users by immediately and accurately uncovering the fair market value of any tradeable piece of art.’
Co-Founder and Chief Product Officer Jamie LaFleur added, ‘No one has ever attempted to build, from primary sources, a modern and truly comprehensive set of data that can be applied to the valuation of artwork. We’ve done it and we have the technology to realize the data’s full potential.’
Artnome: “Think Zillow/Moneyball for art/artists.”
Although Artnome is not as directly focused on price as Magnus or ARTBnk, instead focusing on providing a broader set of information concerning works of art, it is another example of a recent project working to solve the data problem that has long plagued the art world. To be clear, both Magnus and ARTbnk are also working on solving the more general data gap found in the art world and not solely focused on providing price information, which is simply one data point that is relevant to a given piece of art; that being said, Artnome seems to take an approach that is able to provide pricing insights as a result of its wider collection of information related to art rather than collecting art-related information as a means of being able to generate pricing information.
The project, which comes, primarily, in the form of a blog (in contrast to an app or a SasS solution, such as Magnus and ARTBnk, respectively) is a passion project started by self-proclaimed “art nerd,” Jason Bailey. In addition to being less centered on generating price data than how the other projects I have discussed are projected, Artnome’s goals also seem to differ in that they go beyond simply adding transparency to art market. Rather than attempting to speak for Bailey on what it he hopes to achieve, I pulled the following quote from the Artnome website regarding this project’s goals: “Jason is mission driven to use technology and data to improve the world’s art historical record and to improve opportunities for artists from historically underserved or marginalized groups.”
Artnome which comes, primarily, in the form of a blog (in contrast to an app or a SasS solution, such as Magnus and ARTBnk, respectively) also heavily features more specific art-related topics than simply data-related information. The blog also heavily focuses on the intersection of blockchain and the art world, features a podcast related to art + blockchain concepts called Dank Rares, and also touches on other subjects including feminism and art forgery. An example of how Jason utilizes art-related data, much of which he gathered personally by going through as many catalogues raisonnés as he could seemingly get his hands on, is both masterfully displayed and exemplified in an Artnome website post about a Jackson Pollack work, which can be read at the following link: https://www.artnome.com/news/2017/7/17/moneyball-for-art-and-pollocks-tallest-painting. Although likely unbeknownst to Jason, I am a member of several community chat groups in which he participates (most of the time, I am more of a passive follower of discussion topics than actively jumping into conversations), and my experience has been that he is extremely passionate about the art world, using technology to help this area continue to evolve, and also very open to provide helpful information on the data he has collected, the intersection of art and blockchain, and other art-related topics.
Undoubtedly, there are other projects working on resolving the gap in art-market data, especially pricing data. The projects covered in this post only highlight a few of the solutions I have been following and that I wanted to share. I recently downloaded Magnus and was accepted for the ARTBnk beta testing platform, so I am looking forward to begin using both of those platforms over the new few weeks. I also regularly check Artnome for new stories and am always impressed with the content that is provided, and I have no plans to discontinue doing so. I encourage you to check out these projects yourself and let us know what you think!
In some future posts, I plan on discussing a number of other projects that are working to leverage technology in an effort to improve or otherwise impact aspects of the art world, so check back later for new posts on art-tech’s emerging concepts and projects if you are interested in learning more.
About the Author
Ford Harmon is our startup + business law guru and resident tech nerd. Ford helps clients navigate a multitude of business-law concerns. The majority of clients Ford assists are entrepreneurs, startups, or more well-established businesses with creative or tech-centric business models, as well as artists of all mediums.
Learn more about Ford Harmon HERE.