Art Business is Big Business – Art.com Pending IPO Proves It
I recently posted about the emergence of Artaissance on to the art print scene. The post delved into why it’s parentage was important, which is it is curated and managed by the same team that drives the bus over at Larson-Juhl, only the largest picture framing company worldwide. If L-J’s size fails to impress you, certainly the fact that it is a Berkshire Hathaway company ought to.
The story goes that Warren Buffett met with then owner Craig Ponzio for all of 90 minutes before making the decision to purchase the company. Surely, it had to pass muster on its financials, but whatever the time taken for the decision it fit the concept Buffett likes. That is big profitable companies in relatively sleepy corners of the business world. Few outside the business would argue that picture frame moulding is a sexy beast.
When it comes to moving art prints, Art.com has proven it can be done big time on the Internet. The March issue of Business 2.0 magazine identified six tech companies set to go IPO and Art.com was one of them. The article says Art.com was hot because it was producing $100 million in revenue after its merger with rival Allposters.com. That’s one heck of a lot of posters, framed or otherwise!
I recall being astounded (circa 1997?) to learn the original owners of Art.com paid $250,000 to acquire the URL from some small research or manufacturing operation (Advanced Research Technology?) It seemed a crazy idea at the time. Who, after all, was going to be buying art online? I mean you have to see if not touch the stuff to buy it, right? I guess if Bill Gates could once think 64kb of RAM was adequate for desktop computers, I could be allowed to think you couldn’t sell art online or that a quarter billion was too pricey for any URL.
I was later astounded when Getty Images paid some enormous amount for the company only to not have a clue what to do with it. The subsequent buyers did not suffer that problem. Around that time I began hearing from my poster publisher friends that orders from the online sites, Art.com and Allposters.com especially, were rivalling or exceeding the daily orders coming in from poster consolidator, Lieberman’s. Without going into a lesson on poster distribution, I’ll just say that was shocking to realize. That knowledge changed my thinking and raised my awareness that art prints were just one of many items that could easily be sold en masse online. The tactile rationale for such items not to sell was just all wrong.
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Google "art.com + IPO" and the results include lots of Craigslist.org listings for high-powered tech jobs in the Bay area. They each mention Art.com is a pre-IPO company. Being around long enough to remember the last tech era IPO boom, I’m not looking for an investment opportunity here. But, I’m amazed to see what was a once a rather quaint business grow up and get into the fast lane.
The changes wrought to make over the art print business have not been good for all, probably not good for most used to the old school ways of last century’s print and poster market. Many companies, pubishers, distributors, volume framers and others are still trying to figure out how to move their 20th Century business models into the new marketing, manufacturing, distribution paradigm that nearly every industry seems to be undergoing these days. If nothing else, it’s bound to be interesting, if not bumpy as we surge forward. Keep your seat belts fastened when not moving about the cabin.