Thank you Cheryl Karim and Ellen Hoener Ross of Gallagher for inviting me to speak this week to your young collector group. It was an honor to lead the group, and it was an exciting moment to do so, at the end of The Art Business Conference day, with so many interesting conversations fresh in mind.

The talk dealt with strategies for starting an art collection and navigating the complexities of buying art at galleries and at auction, and caring for a collection.

Among the issues discussed were: 1. defining the parameters of a collection; 2. factors that might signal potential market growth; 3. the relative advantages of buying art at auction vs. in retail contexts, for different types of work; and 4. assembling the right team to help you with your collection, including but certainly not limited to an advisor, an insurance broker, a framer, an appraiser, and logistics experts.

Selling the Purchaser

This spring I had the honor of being a guest on the “Private Client Risk & Resilience” podcast, hosted by Kurt Thoennessen, CAPI, Area Vice President, Private Client at Gallagher, and President of our New York Chapter committee of the Private Risk Management Association.

Kurt’s show broadly explores wealth protection and risk management strategies for high-net-worth individuals and families. He invites guests from a range of adjacent fields who address these topics in conversation with him. On this episode, I spoke with Kurt largely from the perspective of the art advisory side of my practice.

An excerpt from our conversation:

KT: “It’s almost as if the artist can choose who to sell to, if they’re at a certain level, and you as the art advisor are selling the purchaser. You’re making a sell to the artist — to sell your client.”

DS: “If a show has seven works of art and, and there are 30 interested parties, you have to explain why your client is somebody who should be among the seven and not the 23. Museums often get priority, because galleries are interested in boosting the profile of the artist, expanding their career, expanding visibility. That’s understandable, but the advisor can put forth an explanation as to why a certain collection is the place for the work to be. Being part of the right private collections is something that is beneficial for the artist. There are a lot of factors […] and collector profile is indeed one of them.”

If the collector (frequently with the help of an art advisor) is unable to secure such a purchase opportunity in the coveted primary market, one may have to resort to buying a similar work in the secondary market — at auction or otherwise. Whereas now, in a moment of market contraction, the gap between primary and secondary prices may be narrowing for some artists, that difference of prices, especially in a growth moment can be severalfold. To the extent to which high-value art is understandably recognized as an asset class, the advisor’s role in securing advantageous primary-market pricing can be key.

You can freely listen to the whole episode here.