Larry's List: Collector Data as Industry Mood Ring
Last Friday, Scott Reyburn of the New York Times introduced much of the art industry to Larry’s List, a subscription-fueled online database offering detailed profiles of over 3,100 prominent collectors worldwide. Co-founded by writer/curator Christoph Noe and London School of Economics postdoc / Chris Hemsworth stunt-double-in-waiting Magnus Resch, Larry’s List lies somewhere between an art industry LinkedIn and a mass doxing repository. And if accurate, some of the data it presents basically doubles as a mood ring for your feelings about the market’s future.
Larry’s List gives its subscribers access to a bounty of information about the collectors it profiles, ranging from which artists are prominently featured in their holdings to which cultural projects they have helped fund recently to which of their contact details are openly available. The site seems to operate with little or no direct cooperation from its subjects. Instead, researchers aggregate the relevant info from “reliable on- and off-line sources,” all supposedly publicly accessible, all linked on the site for transparency’s sake (and likely “Cover Your Ass” contingency, too).
The database’s potential appeal to gallerists, dealers, and nonprofits is obvious. Ostensibly, subscribing to Larry’s List is like renting a digital lock pick to the wants and needs of the world’s wealthiest art enthusiasts. Maybe you discover an affiliation you can use to get a major collector’s attention. Maybe you use your new insights on artist preferences to tailor the works your booth offers at the next big art fair. Maybe if your confidence regularly pierces the ozone layer, you just start cold calling.
It’s an art market “choose your own adventure” game. But whatever a subscriber’s next step, the end goal is the same: sales, donations, or ongoing relationships that would never have happened without access to the database.
Time will tell whether or not this dream scenario plays out frequently enough to justify Larry’s List’s subscription costs. But the point I want to make is less about the site’s business model than the macro picture its data paints of the art-acquiring population.
Aside from its collector profiles, Larry’s List also joins the ranks of many other recent industry analytics startups by offering its own Market Reports. And while talking to Reyburn, Resch tried to tantalize possible customers by giving a quick peep show of the data in their 2014 year-end findings.
One of the most memorable flashes of skin–at least to Reyburn–was about collector volume, or lack thereof. Larry’s List alleges that the art market largely hinges on the activity of only 8,000 to 10,000 high- to ultra-high net worth buyers, all of whom have at least $1 million in liquid assets ready to be deployed for profit or pleasure.
For comparison’s sake, the 2014 edition of the TEFAF Art Market Report alleged that the industry’s health primarily depended on about 600,000 worldwide millionaires–or, to slice matters even finer, about 200,000 ultra-high net worth individuals with stacks equal or greater to $30M.
Resch’s 8,000 to 10,000 figure makes a decidedly bigger impression, and it seems to wallop Reyburn like a cartoon sledgehammer. Combining the Larry’s List data with recent “wealth reports” from Capgemini and RBC Wealth Management, he extrapolates that 10,000 collectors would constitute a mere 0.07 percent of the 13.8 million high- to ultra-high net worth individuals scattered across the globe. And the calculation troubles him:
To be sure, history has shown that markets for art, particularly at auction, can be developed and inflated by a small number of individuals. But it is sobering to learn that today’s boom in the market for contemporary art is based on the spending habits of just 0.07 percent of those who can afford it.
On one hand, I certainly understand Reyburn’s unease. The smaller the number of determinants in any field, the more volatile that field becomes. If 500 substantial collectors–or even 50 of the most gonzo–decide to curtail their art acquisitions for a year or two, that bout of commercial abstinence could plunge a market with only 10,000 meaningful customers straight into Hell’s ninth circle.
But on the other hand, can’t this same data also be viewed as a mammoth opportunity for the arts? Finding that only 0.07 percent of an industry’s possible major revenue sources is active means that a staggering 99.93 percent is just waiting to be converted to the cause. If I were a a gallerist, dealer, nonprofit head, or anyone else in the fine art sector who could benefit from a sweaty envelope of cash (or a nice clean wire transfer), the concept of nearly 14 million untapped high net worth patrons would make me as ravenous as a caged Kodiak bear in a hot dog eating contest–especially given the herd mentality of consumerism, even at the high end of the wealth spectrum.
In that sense, your reaction to Reyburn’s piece speaks volumes about your feelings on the market going forward. If Larry’s List’s numbers are accurate, then the art sales space may be far more volatile than any of us realized. But whether that means you should be bullish or bearish on the direction of change still looks to me like a very open question.