It’s a common scene across the country: an art auction with a piece of work at the center that is allegedly worth a ton of money. However, in certain auctions, "estimated price range" isn’t realistic.
ARTBnk created a SaaS solution for art collectors of all sizes, giving them a chance to evaluate pieces of art...no need for an expert to come in and put a price on them.
We spoke with Rob Steinberg, ARTBnk’s Co-Founder and CEO, to learn more about the startup and how it is disrupting the fine art collection industry. Steinberg also spoke in detail about the technology behind the product.
Colin Barry [CB]: How did ARTBnk come together?
Rob Steinberg [RS]: My Co-Founder Jamie LaFleur and I met through a mutual acquaintance. Jamie, at the time, was operating a gallery in Portsmouth and I grew to like him as a dealer and as a friend. He started his business selling poster art in tourist communities and grew to sell multi-million dollar paintings. But, that wasn’t every day.
At the time, the company was I running, NAPC, was selling into the late majority market, which has little attraction for me. Jamie and I were talking about what was next for us. He was facing a lot of the same problems with the business side of art that I had been and trying to figure out the future.
We thought, what is fun, innovative and disruptive, that has to do with art? We noted that there wasn’t a good collection management system, but that was a minor problem. More importantly, day to day, most collectors don’t know what their paintings are worth. There are databases that report gallery and auction results, but that either gives you historical data without context or the prices may not be reported at all. You can go to an appraiser to spend the money and wait, but then you’re waiting and paying for an opinion, not an objective reality.
Jamie and I believe this is revolutionary. If you can instantly generate a value of an object, that’s remarkable and important. In the beginning, I remember saying the scariest words in the English language, “Well, how hard can it be?” Jamie knows art, and I know technology. It seemed to be a natural fit and we started in. And that’s when you find out how hard it is.
We now demonstrate the technology using the artist Albert Bierstadt as an example. There are 862 public auction records that go back to when digital auction records became commonplace. We chose one of his paintings to generate the valuation and found two comparables out of 862 works. Normally, you’d have to sort through the data manually, but our system was able to do it in seconds.
CB: What are some of the biggest problems in the art industry that ARTBnk is looking to solve?
RS: Art doesn't have big data; there certainly aren’t petabytes and aren’t even terabytes. We need to use AI with small data, and that's a breakthrough. Looking at the historical databases will give you auction records, but that doesn’t give you qualitative information. The equivalent of that would be reading a 2006 issue of The Wall Street Journal and trying to buy stocks tomorrow. What’s the worth of that?
The other problem is that the existing data is wildly inaccurate. One example is an auction with paintings by Pablo Picasso that had successive lots showing different variations of Picasso. One said he was born in the US, another that he was born in Spain, and a third in France. AI can’t make sense without accurate data.
CB: So, let’s say I am an avid art collector and I wanted to start using ARTBnk. Explain to me how ARTBnk’s SaaS product works.
RS: Right now, you need to know the artist’s name and you need a picture of the piece. If it’s in our database, it will either autofill or give suggestions about which is the right work. If it hasn’t been in our database, you’ll have to enter more information yourself, usually a couple of fields. Once the painting is in the database, and if it has a secondary market value, we can give you a Real Time Valuation in seconds.
If you’re using our app, you can also take a picture with your smartphone and go from there.
CB: If applicable, who are some of ARTBnk’s users and are there any use cases from them that have stood out to you?
RS: We have about 500 early access users right now, and we are looking forward to launching in June of this year.
We can’t give you the names of our users because most collectors want to stay private, but we just on-boarded a collector with 150 pieces. His insurance company required an appraisal in order to get these pieces insured. A similar collector we now work with, just finished a three months long exercise, and paid many thousands of dollars in fees. As a test, our platform was able to duplicate the same work in less than three days, although he previously had virtually no information about his collection. And it will now stay current.
We're seeing demand in family offices, wealth managers, trust and estate attorneys, insurance companies, even people with small collections who are just looking for organization, in case they have a loss.
CB: Any other additional comments you’d like to make?
RS: It’s fun to be a disruptor. This is the last market of its size that's unregulated and operated as a guild with restricted insider knowledge. Insider trading is the norm and those who are outside of it expect to be taken advantage of. Why not disrupt that market?
Images courtesy of ARTBnk