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@rrhoover @michael_d_angelo The art market has grown at about 7.5% YoY, and current art funds have returned 10% YoY. By applying cutting edge data science to the market, we easily beat the benchmark.
A couple of surprising facts:
There are $2B in Art funds to date
90% of investment worthy art is held in storage
72% of collectors view their collecting activities as an investment
The majority of sales happen below the $250K mark.
@madelaine_d_angelo @rrhoover @michael_d_angelo This is quite cool. What are you applying ML on? Historical price data?
@dylankbuckley @rrhoover @michael_d_angelo That's exactly what we are doing! Our CTO did his Ph.D. work at Stanford in ICME. We're treating the art market as one big machine learning problem.
@madelaine_d_angelo @rrhoover @michael_d_angelo I met a guy a while back in Chicago who built a ML model that predicted art price at auction. If I remember who it is ill send you his details. Best of luck.
what's changed since i posted you guys 3 years ago? : https://www.producthunt.com/post...
the design looks very nice btw
why are you not taking any management fee with these funds? is it because you're just getting stated?
re "Three-year investment period with two-year divestment and distribution period" does that mean that you'll spend 3 years spending the money, then 2 additional years divesting the works. so a total return time of 5 years?
@madelaine_d_angelo @michael_d_angelo Congrats on the launch!
Long-term, how do you think about diversifying sources of capital, e.g. retail <> accredited <> institutional? Any plans to take advantage of Title III or Reg A+ to open up to non-accredited investors? Or is the plan to have institutional capital eventually be the primary source of capital once you have a more mature track record?
Cool idea! How does the team think about liquidity as it relates to the overall value of a portfolio or piece? I'd hate to learn that broker fees / auctions / etc. would wipe out too much of the growth/appreciation earned over time. I don't know the nuances of the art market so apologies in advance.
@jawise we'd be happy to speak to you about liquidity if you can elaborate. We only look at artists that have high sell-through rate at auction, meaning that they have a hight chance of selling when we exit them. We also focus on acquiring assets below the 250K mark which account for over 80% of sales in Modern, Contemporary, and Emerging- which is where we invest.
This is one of those ideas that leave you like "This is so obvious, but I would have never thought about it on my own."
Congrats on the launch! Killer team. 🚀🚀🚀
Really enjoyed the Arthena pitch last year at the 43North competition. I think it's a great idea and investment alternative.
Cool idea. This paper may interest you: http://bit.ly/2naxcIG, "I exploit this insight to explain why the measured risk premium of a portfolio of artworks is low compared to other risky assets."
If you want maximum risk-adjusted ROI, art is probably not the vehicle. By transforming this into a pure ML problem, have you thrown away some of the most important aspects (non-pecuniary) of art ownership? Still, it's a very interesting and admirable venture.
@j_jason_bell Hi Jason, Thanks for the share! Looking forward to reading the article.
Arthena solves this problem, "If you want maximum risk-adjusted ROI, art is probably not the vehicle." I would agree if you were just ad-hoc investing and collecting assets, instead of investing in a quant fund.
This is one of the problems that inspired us to found Arthena.
Additionally, Over 90% of art purchased at auction is purchased by private investors and thrown into storage. In addition to displaying our art through our online platform, we’re going to physically display our art, by loaning it out to museums and galleries, and by leasing it to commercial spaces.
@madelaine_d_angelo @j_jason_bell
> In addition to displaying our art through our online platform, we’re going to physically display our art, by loaning it out to museums and galleries, and by leasing it to commercial spaces.
Was going to ask if it'd be possible to have the art on display, and you've already answered my question. Awesome work guys!
Arthena is the first quantitative investment product for art. We apply cutting edge data science to the art market and create funds that buy art. We are the best way to invest in the inefficient, 70 billion dollar per year art market which has low correlation to the S&P. Old-school art funds are already generating returns of 10% year on year.
Arthena has built the world's most advanced pricing model for Art. Through our methodology, we can outperform the market massively, and our funds have generated 23% returns to date.
Our Methodology can:
Discover market inefficiencies
Take advantage of arbitrage opportunities
Determine when to buy and sell
Buy undervalued artists
Build diversified portfolios, focused on risk adjusted returns.
The growth of the art market is directly correlated with the growth of high net worth individuals, which is growing faster than any other segment on earth. Unlike real-estate is growing with the middle class. Art is growing with the high net worth, growing faster than any other segment on earth. In this world where commodities prices continue to decline because of technological advancement, High net worth individuals will look to put their money in things that have natural scarcity. Art will continue to have scarcity and because wealth is growing, the prices of the asset will continue to grow.
Like a hedge fund, we take a 2% management fee per year and 20% performance fee.
Over 72% of art is purchased for investment, and Over 90% of art purchased at auction is purchased by private investors and put into storage. Arthena aims to display our art, by loaning it out to museums and galleries, and by leasing it to commercial spaces.
In addition to displaying our art through our online platform, but we’re going to physically display it by
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