There are two things in life where obtaining more is fundamentally impossible – time and talent. Certainly, we can stretch the days, make better use of our time, … we can even push our own mortality. As for talent, we can take an existing attribute and enhance it through application and training. However, both have their limits.
And yet, over the centuries, art has provided a method of exploiting one and nurturing the other. Throughout history, art collectors have been investors in time and talent, taking two precious resources and benefitting from the rare value which accumulates: the marriage of scarce talent and a creative, time-limited output.
Commissioning Wealth: The Medicis
Sometimes the talent is obvious, credibility borne of decades of acclamation but on other occasions it has required more of a leap of faith. Faith which led to committed patronage. The Medicis, the Italian banking family and political dynasty that ruled Florence from the early 1500s, are arguably the ultimate example of how wealth in one field can be harnessed to provide sponsorship for artists. Their commissions allowed artists such as Donatello, Botticelli, and Michelangelo, to concentrate on their work free from day-to-day worry. Their farsightedness helping foster the Renaissance and endowing the Medicis and, in time, a grateful world with breath-taking art.
Superficially, while many regard art as a luxury purchase; the Medicis demonstrated it was a shrewd investment. An investment in the artist but also in their own family, building equity that demonstrated their culture and contribution to society. In time, it also became a store of financial value. As bankers they, better than most, understood the importance of diversifying their wealth.
Their leadership has been replicated over the centuries.
American Collectors & Modern Fortunes
At the outset of the Second World War, Peggy Guggenheim, a scion of Solomon Guggenheim, was rumoured to have bought a painting a day, building up an almost peerless collection of works by the world’s most celebrated 20th century artists: Chagall, Picasso, Ernst, Miró, Magritte, Man Ray and Dalí. A keen eye and an ability to make friendships with artists ultimately resulting in a collection which is housed in her former home, Palazzo Venier dei Leoni, on the Grand Canal in Venice.
Just ahead of Peggy Guggenheim, the American midwestern ‘oil baron’, J. Paul Getty, took advantage of art prices dropping ahead of the same war and collected European paintings. When he died, he left most of his estate to the J. Paul Getty Museum Trust, the trust that runs the J. Paul Getty Museum in Los Angeles with assets, including the art, of around $10 billion. He also authored one of the most powerful thoughts on art – “The beauty one can find in art is one of the pitifully few real and lasting products of human endeavour”.
Before crossing the Atlantic, it would be remiss not to mention David Rockefeller, who followed in his parents’ footsteps when it came to art. His mother helped found New York’s Museum of Modern Art. Throughout his lifetime, he collected around 15,000 works of art, donating paintings by Picasso, Cézanne, Gauguin and Matisse to the Museum. In 2007, he sold a painting by Mark Rothko at Sotheby’s in New York for almost $73 million. He had bought it in 1959 for $10,000.
Contemporary French Titans
Which takes us to France and the modern day art rivalry of François Pinault and Bernard Arnaud. Pinault, as the founder and head of the Kering Group, has created a luxury good behemoth and a personal fortune of €40 billion euros, which has allowed him to maintain his devotion to contemporary art. A personal collection of works spearheaded by Post-War and Contemporary art luminaries like Andy Warhol, Mark Rothko, Roy Lichtenstein, and Jackson Pollock is housed in his personal temples to art and his collection of over 10,000 works by almost 400 artists: a reimagined Bourse de Commerce in Paris, and the Palazzo Grassi and Punta della Dogana in Venice.
Pinault’s endeavours are rivalled by Bernard Arnaud, who elevated his love of art with the inauguration of the Fondation Louis Vuitton, a $135 million Frank Gehry–designed museum in Paris’s Bois de Boulogne. With a collection that spans the 20th and 21st centuries, exhibitions have brought together celebrated artists from Claude Monet and Joan Mitchell to Andy Warhol and Jean-Michel Basquiat.
Undoubtably, like the Medicis, those five examples of buying, collecting, and gifting art to be enjoyed by others is a potent demonstration of success and of taste. Money invested providing a constant dividend of cachet and, as auction performances show, significant financial return.
In this article we have looked back in time and there is one more moment in history which some would argue is the pivotal moment in the commercialisation of art.
The Big Reveal: the Sale of Robert C. Scull
Robert C. Scull, a New Yorker and passionate collector of both Abstract Expressionist and Pop Art, sold 50 of his best paintings at auction in October 1973. That auction was the catalyst for a new era in the art world ashe artworks sold for many multiples of their original purchase prices. A painting by Cy Twombly sold for $40,000, over 50 times the original $750 Scull had paid. A Jasper Johns painting, Double White Map, went for $240,000, it had been bought originally for $10,200.
The sale totalled over $2 million, ($12 million in today’s dollars) and established new records for living artists. It revealed to the wider world what those historic collectors knew already: money could be made in contemporary art and that investing in art was a credible option for many.
The Art Market Now
The intoxicating attraction of social, cultural, and monetary currency in a commercial environment where the value and volume of art transactions are increasingly advertised, has created a genuine dynamic marketplace where collectors not only buy and hold, but also buy and trade. In 2021, the total value of transactions in the global art market amounted to just over $65 billion. In 2022, new records were set for the most expensive Post-War & Contemporary work of art at auction – Warhol’s Shot Sage Blue Marilyn for $195 million – and most expensive single owner sale – over $1.6 billion for the Paul G. Allen Collection. The market continues to flourish.
Before ending, let us turn back to the Medicis. The last Medici ruler died without a male heir in 1737, but to this day over one million people visit the Palazzo Vecchio to view their collection every year. In investing in art and supporting the talents of Botticelli, Michelangelo and Leonardo da Vinci, they amassed great wealth. Inflation adjusted and with appreciation their wealth would stand at around $129 billion. A competitor for Jeff Bezos.
Yet their mark on history, the value beyond financial, is simply priceless.
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