Startups focused on the art world have raised over $228M in venture capital financing since 2003. Almost 3/4 of funding has gone to art startups focused on the high-end art market.
Since 2003, startups that facilitate the buying, selling or discovery of art online have raised over $228M. And while venture capital investments are often talked about as democratizing access to markets, VC investments into the art world have been primarily focused on high-end art purchasers. (Note: Our previous post on VC financing to online luxury retailers hitting a 10 quarter high)
Over 73% of the funding going to the art market space has gone to startups targeting the affluent – aka as the 1%. One recent example is Benchmark Capital-funded luxury art and antiques provider 1stdibs which targets the high-end customer. It’s worth noting that Benchmark is not all about the bourgeoisie as they also backed affordable art seller and pre-IPO company Art.com.
There have been some startups like Art.com and others that have targeted the masses. True Ventures and Founder Collective-backed 20×200, which sold affordable art prints, suspended operations in February 2013 leaving behind a slew of angry customers and collectors. The company’s founder Jen Bekman has said the service will come back but a “we’re taking stock and making updates” notice has greeted site visitors since February. Peter Thiel-backed art rental site Artify.it shut down in June (think: Netflix for Art). Whether these failures are an indictment of the “art for everyone” business model or the result of specific issues with these firms is hard to say.
The chart below does a nice job of highlighting the increasing gap in venture capital funding between high-end and mass market art startups.