Online tools like Zillow’s ‘Zestimate’ can help potential buyers estimate a fair price for a house. Kelley Blue Book does the same thing for buying a used car.
Fine art, though, has always been more subjective, and more subject to huge price swings, making price valuations difficult.
ARTBnk, a Newmarket-based company, is offering a new approach to valuing fine art, relying on huge reams of data combined with human appraisers to create real-time pricing of tradeable works of art.
“We are not telling anyone not to buy something because it is more or less what ARTBnk says. We are just telling you to use this information to make the best decisions you can,” says the start-up’s co-founder Jamie LaFleur.
(Editor's note: we highly recommend listening to this story)
Last month, LaFleur and I met up in Miami at the annual Art Basel art fair to see the app in action.
“It’s galleries from all around the world showing all different types of art in one spot, one location. I would say it’s about three football fields filled with art,” he says.
LaFleur spent years running a gallery in Portsmouth, but the scene at Art Basel doesn’t quite match up with that experience. The event is prestigious, with well-off buyers looking to make major purchases from eager galleries. Even with deep pockets, nobody here wants to get ripped off.
“No one wants to be the fish,” says LaFleur. “You walk around here, and they are all putting the bait out trying to find the fish.”
ARTBnk wants to help art lovers be more savvy with their purchases.To use the app, snap a photo of a piece of art hanging on the wall, and then enter in a few key details, such as its year, size and medium. Within seconds, the algorithm sifts through both publicly available auction sales results for that artist, as well as guidance from in-house appraisers. It then spits out a fair market value of the painting.
With the company still in its early stages it only can produce valuations for approximately 75 artists.
“People like Andy Warhol, Pablo Picasso, Jean Michel Basquiat. Major artists, right?” says LaFleur.
The list of artists is expected to reach 500 by the end of the fall. But at Art Basel, it’s easy to find already covered works.
LaFleur walks over to a painting by Joan Mitchell, an abstract expressionist.
He takes a photo, and enters in the title: “Untitled.”
The medium: “Oil on canvas.”
Size, year, and then presses enter:
“And the real time valuation on the work is $3,765,246,” says LaFleur.
He then speaks briefly with a man in expensive looking eyewear who works for the gallery, and comes back with the asking price: $5.5 million
“So they’re priced up a little bit. In this environment, that’s not uncommon. And they probably value this piece tremendously,” says LaFleur. The company hopes that with an ARTBnk evaluation in hand, buyers have a potential starting point for negotiating a lower price.
(ARTBnk says it recently revised its estimate for this painting to $5,009,014, based on removing an outlier from its Joan Mitchell data set.)
ARTBnk makes its money by charging a subscription fee, ranging from $100 per year to a professional-grade package priced at $1,000.
The company says that fee is cheaper than hiring professional art appraisers, which is the traditional and still most accepted way to value a painting.
“That’s the sort of thing that has only been done well by humans, to date,” says Don Thompson, an art economist based in Toronto and author of The Orange Balloon Dog: Bubbles, Turmoil and Avarice in the Contemporary Art Market.
Thompson says even if an app can one day replace an appraiser, buyers could still wind up over-paying: art is an emotional purchase, not a rational one.
“People do overpay for art because they fall in love with it. You love it, you want it on your wall,” says Thompson.
LaFleur says ARTBnk isn’t trying to get between you and the painting you want to own. The opposite in fact. He thinks better information will lead collectors to make even more purchases.
“We want to find people that love art, that live with art, that collect art, that support artists, that engage with it,” he says, “ and give them the confidence to do even more than they feel they can do, and to bring other people into the marketplace.”
If more people can get the paintings they want at a fair price, he believes they’re more likely to buy more of them.