Investing in Art Market Businesses – artmarketblog.com
Everyone knows that the art market is booming and that the businesses involved with the art market such as art dealers, auction houses, art bankers, art investment funds etc. are raking in the money. So why aren’t more people investing in these companies? The answer is probably that people are more focused on the art than the companies serving the art market and are more than likely unaware of the opportunities that exist to invest in such companies to begin with. What if I was to tell you that you can not only invest in businesses serving the art market but you can actually invest in an investment fund that invests exclusively in businesses serving the art industry. Interested? – so you should be.
The Art Industry Fund has been created specifically as a means of investing in the companies that provide services to the art world and is being managed by the extremely savvy people at the New York based investment banking company Index Atlas which is headed up by the world renowned entrepreneur Sergey Skaterschikov. As well as being the founder and CEO of IndexAtlas (http://www.indexatlas.com), Skaterschikov is also responsible for the highly regarded Skate’s Art Investment Handbook (http://www.skatepress.com). The IndexAtlas Art Industry Fund is a private equity fund which, according to the Investopedia (http://www.investopedia.com), can be defined as consisting of investors “that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of public equity. Capital for private equity is raised from retail and institutional investors, and can be used to fund new technologies, expand working capital within an owned company, make acquisitions, or to strengthen a balance sheet”.
Basically, the way such a fund works is that the fund invests the money it has raised from it’s investors in a series of companies (in exchange for equity in the companies) which, is then used by the companies to undertake activities aimed at increasing the revenue and value of each company. By investing the money in these companies, the fund hopes to increase the value of the equity it has in the company so that when the fund’s equity positions are liquidated (or equity value is recouped in another way), the fund ends up with a profit which can then be passed on to those that have invested in the fund. As well as the private equity investment, the IndexAtlas Art Industry Fund will also be investing (on a limited basis) in a small number of publicly traded (stock market) companies that are involved in the art industry.
According to a press release from Index Atlas, “The fund’s primary objectives are to bring increased transparency to art investing and to support development and expansion of lasting institutions that will serve the art world and the greater alternative investment market as a whole. We seek to attain that mission in challenging art market environment by actively adding value in the boards of our portfolio companies and adhering to the ethical and transparency standards of today’s mainstream financial markets.” If you can afford the USD$1,000,000 minimum investment and have an interest in art and the art market, I would suggest you seriously consider this opportunity. For more information check out the IndexAtlas website at http://www.indexatlas.com/alternative_investments/artfund.html and for more information on the Skate’s Art Investment Handbook go to http://www.skatepress.com
**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications.