Devang Thakkar was half awake at 4am, Seattle time, and had to blink twice at the live auction at Phillips in Hong Kong on his screen. A client in New Jersey was bidding over Artsy’s app, going after a George Condo painting. The bidder was knocked out once, then twice, but ultimately prevailed, winning the Condo for an above-estimate HK$2.48m. In that moment Thakkar, a trained software engineer and head of auctions for Artsy, knew his vision was working.
With the New York-based start-up’s announcement over the summer of an additional $50m in venture funding, online auction wars are heating up. According to the 2017 Hiscox Online Art Trade Report, the past year has seen increasing competition in the digital sales sphere, causing casualties for online start-ups that had vowed to “disrupt” the estimated $3.75bn segment of the industry. The heritage incumbents are stepping up their game; in a bold move, Sotheby’s announced in late August that it was doing away with buyer’s premium for online-only sales.
No single seller has achieved critical mass, and the model that has gained the most traction is the third-party marketplace, which functions not as a threat to existing, trusted brands but as a facilitator for them. Rather than competing with bricks-and-mortar houses for quality consignments, they help market it to a wider clientele and provide sophisticated live-bidding technology. Read more