The high-end art world is known as a closed caste in the service of a mysterious élite that is extremely concerned about its privacy. In this game, where access is by invitation only, those who thrive are already insiders and boast considerable experience. The kind of experience that no university course in economics can teach you and which implies only one way of access: ‘sitting with Nellie’.
But what’s the rationale behind this system? Are all gallery owners really perched in their privileges? And, above all, what do art dealers actually do? How does one go about buying and selling on the private market? What really happens in those private rooms, away from prying eyes?
The false myths circulating in the art world cause a sort of information shortcircuit – a smokescreen if you like – which further fuels the idea that the art market is somewhat “sketchy”.
There is more than one reason why the information leaked to the outside world is deliberately unreliable. On the one hand, it protects the negotiating parties, who are primarily concerned about their confidentiality. On the other hand, it is to safeguard a vulnerable and valuable good whose reputation hangs by a thread, like the virginity of a Victorian young girl: it takes nothing to lose it.
Especially when it comes to blue-chip works (high-end pieces of art, a Picasso, for instance), absolute discretion is the best weapon to preserve their reputation and, consequently, their estimate on the market. Otherwise, the work is ‘burnt’, and the economic damage may be incalculable for the owner.
Yet, this topic is not addressed in textbooks or seminars, let alone in university lectures. It may seem that selling is a simple and unambiguous process governed by a straightforward cause-and-effect mechanism: here’s a painting, here’s a buyer, you agree on a price, and there you go – you got a handshake deal – a simple gentlemen’s agreement.
Unfortunately, this ideal scenario is as far from reality as the Earth is from the moon. The selling process is never that smooth, and conducting negotiations in the secondary market requires specific competencies and capacities: besides robust connoisseurship, you will need to have out-of-the-ordinary negotiating skills, the patience of a Tibetan bonze, the tenacious perseverance of an Olympian, the unflappable aplomb of a poker player, and the diplomatic cunning of Angela Merkel, all rolled into one. Plus, you need to know the techniques.
Negotiation know-how is perhaps the best-kept secret in the most hidden room of the palace. It makes all the difference between a professional and a casual parvenu who comes from nowhere to try his hand at a difficult field. The chaos and confusion resulting from unprofessional players cause 99% of negotiations to fail – even if they started with the best intentions.
Despite what may be said on the outside, this game has its rules.
Understanding the value is the king of rules. Navigating the apparent discrepancy between aesthetic, historical, and market value is key, and it requires a specific expertise that embraces art and finance. This topic will be the subject of my next article: we will start our journey together behind the scenes of the secondary art market. Step by step, I will help you acquire the tools and skills to navigate a treacherous market without risking costly mistakes. I want you to peek inside an art transaction on the private collectors’ market. And to take a chance, if you like. I will provide you with all my experience in the foxhole.
And, if you prefer to make it easy and rely on a professional, Anchorage is always at your side, every step of the way.
