Art is a viable business. What is left is for investors to apply the principle of commerce into running an art business. This was the view expressed by the Principal, Sub-Saharan Africa Master Card Advisors Business and Co-Founder, Red Door Gallery Bola Asiru at the Monthly discourse: “Point Of View,” organised by Ben Enwonwu Foundation (BEF).
The event was made possible in collaboration with the Society of Nigerian Artists. It took place recently at the Alliance Franncaise/ Mike Adenuga Centre, Ikoyi Lagos, and mirrored the topic, “Raising Capital against High Value Works of Art.”
Taking the floor on “Presentation on the Nigerian Art Market in Transformation: New Direction in Lending, Investment and Wealth Management,” Asiru revealed that one of the drivers for art demand was pure training and commerce.
He noted that, sometimes in the art world, profitability in terms of commercial art was not considered proper. He stressed that art was a viable business and people must apply the principle of commerce into running an art business. “So, training and commerce are forms of demand to the galleries, auction houses etc., which can actually drive the demand,” he added.
He said that art was an asset class which required research, the same way people research into whether to buy a property in the Island or Mainland. “People need to do their analysis with regards to previous sales prices over a period; the threats and projections; get adviser, acquire and store the art, and decide when the next exit should be. It could be five or fifty years,” he posited
He told the audience consequently, “When you are setting up a firm, it is up to you to decide on what you want to use as the underline assets. It could be gold, property or mix of securities and bonds. There are several firms that use art and collectibles as their underline assets.”
He established that had economic value, owned by either individual or corporate. But the expectation was that it should provide future benefits so that at some point in the future, one should be able to liquidate it.
He cited the World Street Journal, noting that, last year; the best investment was art, followed by cars in terms of basic returns, adding that “in Nairobi, security exchange are proposing to introduce fine art as an asset class and we have an expectation that in future our art would be worth a lot more than it is today. Even though structurally, we are still playing catch up in Nigeria,” he said.
In his presentation on “Data Driven Valuation: Financial Decisions and Investment Opportunities in the Nigerian Art Market,” Chairman Editorial Board, Business Day, Tayo Fagbule, hinged his presentation on data and hunch, saying that the same premonition saw the discovery of jazz impresarios, Aretha Franklin and Billy Holiday, by Paul Hammond.
On how data is driving the Nigerian art market and financial decisions, he said, “This is nothing but data influencing the price of Nigerian art sold at auction market all over the world. Many people who bought works of the Enwonwu and other artists with high value works of Art basically bought it based on hunch and data, so data can be used intelligently. Last year, Tutu sold for $1.5m. This year, it sold $1.4m. Basically, you have a trend based on artists you can tell their performance, and future.”
Fagbule said that behind the huge amount that was put against Christene’s Davis portrait by Ben Enwonwu in 1971, philosophers of art, cultural agents to museum, foundations, galleries, Journalists, dealers, and private collectors contributed to the art that was sold weeks ago. “They, one way or the other inform the value that eventually was paid, or would be paid or higher in future for that work commissioned by her husband as a gift, when it ever reappears again at auction,” he added.
Fagunle’s appearance was followed by a four man panel of discussants composed of Professor Koyinsola, AjayI, Managing Partner, Olaniwun Ajayi LP, Yemisi Adedoyin Shyllon, Founder Yemisi Adedoyin Shylllon Foundation, (OYASAF) Kavita Chellaram, Chief Executive Officer, Arthouse Contemporary and John Opubor, Managing Partner, Coronation Capital. The panel discussion moderated by Dapo Adeniyi, publisher, Position Magazine X-rayed the challenges, risks and regulatory frameworks.