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How I Gained Access to the Rarified World of Famous Art Investing

Jude Phillips
ByJude PhillipsAug 3, 2022In partnership with Masterworks

Part of the reason I became a professional account executive at a newer and big technology company is that I like investing in nice things. Do I love the challenge of drafting an iron-clad contract? Sure! Do I get fired up talking about things like tortious interference? Totally! But if I’m honest, I’ve always been a little bit more “Elle Woods” than “Erin Brockovich.” I like being able to afford a certain level of luxury. Whether it’s enjoying a drink at SoHo House, splurging on a pair of Manolos, or booking the chef’s table at Nobu, I’m a sucker for exclusivity. So when a friend told me she’d “invested in a Picasso,” I was all ears.

When it comes to the most famous works of art, let’s get real: they’re out of reach for most of us mere mortals. Only about the top 100 richest people in the world can comfortably afford to pick up a recognizable piece of art from one of the top masters. So when my friend dropped that little tidbit on me, I was immediately intrigued. (Was she a secret heiress?) Come to find out, she’d found a way to tap into this ultra-exclusive asset class typically reserved for the uber-rich. She’d found Masterworks.

What is Masterworks

With Masterworks, you can invest in shares of art from some of the most famous artists of all time. (Think Monet, Banksy, Warhol, and yes, Picasso.) Regardless of whether your budget is “G6,” “first class,” or “coach,” you’re in.

But despite the glittery curb appeal, shares are not a novelty buy; Masterworks takes investing seriously. Over the last 26 years, contemporary art prices have outpaced the S&P, and Masterworks employs a team of experts to make sure they’re buying the right pieces that are most likely to increase in value. They watch sale trends and keep an eye out for artist markets that are gaining momentum. The acquisitions team will then locate the right piece at a fair price and make a purchase. Just like me when I’m browsing the wine list for that perfect bottle of Bordeaux, the Masterworks team is picky. Less than 2.2% of all pieces that are reviewed make the cut.

How does it work?

Masterworks purchases and securitizes the artwork, allowing anyone to invest in it.  This means you no longer need to be an oligarch or an oil baron to invest in a piece of art history.

Pieces are held for up to 10 years, and when they sell, you receive your portion of the profit, net of fees. Need to sell early? There’s a secondary market where you can list your shares for purchase by other investors.

As someone who appreciates great service, I was most impressed by the onboarding process. I was able to set up time with an advisor who talked me through the various available artworks and answered my questions. Even though the consultation was free, the experience was truly white glove. My advisor wasn’t rushing to get on to the next call and he didn’t give me the hard sell. (Which honestly probably led me to spend more.)

Final Thoughts

Now, don’t get me wrong. I don’t have any plans to cash out my 401k anytime soon and go all-in on oils and canvas, but I love having a small portion of my portfolio in some of the most exclusive art in the world. True, it’s a great investment, but I can’t help that my favorite part about Masterworks is that I, too, now get to talk about “my Picasso.”

See important Regulation A disclosures at masterworks.io/cd