Paddle 8, the present and future of bidding at online auction
WHEN EDWARD HOPPER’S “OCTOBER ON CAPE COD” SOLD VIA CHRISTIE’S LIVE FOR $9.6 MILLION IN NOVEMBER 2012, A WORLD RECORD WAS ESTABLISHED AT THAT TIME FOR AN ARTWORK SOLD ONLINE AT ANY INTERNATIONAL AUCTION HOUSE. IF THERE HAD BEEN ANY LINGERING DOUBTS ABOUT THE SCOPE AND IMPORTANCE OF THE ONLINE AUCTION PLATFORM, THIS CERTAINLY PUT THEM TO REST. IN 2013, THE BRILLIANT AMY CAPPELAZZO, THEN CHRISTIE’S CHAIRMAN OF POSTWAR AND CONTEMPORARY ART DEVELOPMENT, BROUGHT WARHOL TO THE 2.0 PUBLIC IN A WEEK LONG ONLINE-ONLY AUCTION BENEFITING THE ANDY WARHOL FOUNDATION FOR THE VISUAL ARTS.
IN AN INTERVIEW ON BLOOMBERG TV THAT FEBRUARY, AMY SAID:
“Increasingly, clients are comfortable bidding in an online format… I think that the online space is for works of art under a certain price point,” she added. “Works under $50,000 or $100,000 might well be conducted in an online capacity.”
I AM VERY GRATEFUL TO MY COLLEAGUE AND FRIEND, CHARLIE MANZO, FOR HIS CONTRIBUTION TO THE LRFA BLOG. THE ORIGINAL INTERVIEW TOOK PLACE WHEN CHARLIE WAS STILL A DIRECTOR AT GAGOSIAN GALLERY AND, AS BUSY AS HE IS, HE VERY KINDLY UPDATED THE INTERVIEW WHEN HE MADE THE MOVE TO PADDLE8. I AM ONLY POSTING IT NOW, MANY MONTHS LATER, AS I ELECTED TO POST SOME “TIME-SENSITIVE” BLOGS (THE ADAA FAIR AT THE ARMORY, FOR EXAMPLE) AHEAD OF HIS. TO KEEP THE BLOG CURRENT, I HAVE BEEN HIGHLIGHTING CURRENT PADDLE8 AUCTIONS IN THE POSTS. http://paddle8.com/
CHARLIE, THANK YOU FOR YOUR MULTIPLE CONTRIBUTIONS TO THE LRFA BLOG! YOUR JOB TITLE, SENIOR SPECIALIST, AT PADDLE8, IS AN AUCTION HOUSE TERM. WHAT HAS YOUR FOCUS AT PADDLE8 BEEN?
It is definitely an auction term, however, my focus at Paddle8 is the private sale business. I certainly contributed to our foundation business which is the auctions but I concentrated on connecting buyers and sellers on the private side, very similar to a secondary market dealer or advisor.
HOW DOES PADDLE8 BRING IN NEW MATERIAL FOR AUCTION? HOW DOES PADDLE8 COMPETE WITH THE ESTABLISHED BRICKS AND MORTAR AUCTION HOUSES AND THEIR ON-LINE BIDDING SERVICES?
Paddle8 brings in new material and gain access to works that are typically under $100,000. Our “sweet-spot” for auctions is $5,000 – $15,000, since we have much less overhead than the traditional brick and mortar houses we can focus doing lots of volume in this price range and be very successful with it online.
A GOOD EXAMPLE IS A SALE OPENING ONLINE TODAY, JUNE 17TH, ENTITLED “JUNE CONTEMPORARY”, A SALE OF WORKS BY THE MOST ESTABLISHED ARTISTS WORKING TODAY (SUCH AS THE SUGIMOTO LIGHTNING FIELDS REPRESENTED HERE) AS WELL AS MID-CAREER AND EMERGING ARTISTS ON THE NEW YORK AND INTERNATIONAL ART SCENE. http://paddle8.com/auctions
WHAT IS THE COMMISSION STRUCTURE AT PADDLE8? IS IT SIGNIFICANTLY LOWER THAN AT THE AUCTION HOUSES – WHAT DOES THIS DISCOUNTED RATE HOPE TO PRODUCE? ALTHOUGH PADDLE8 DOESN’T HAVE CONVENTIONAL “OVERHEAD”, THE TECHNICAL SUPPORT SYSTEM MUST BE VERY COSTLY.
Yes, the commission structure for Paddle8 is significantly lower than any other auction house, we charge 6% vendor’s commission and 12% buyers premium which is half of most auctions houses.
IT IS VERY INTERESTING TO ME THAT INDIVIDUAL INVESTORS IN PADDLE8 INCLUDE COLLECTORS, ARTISTS AND DEALERS. WHAT IS THEIR THINKING IN SUPPORTING A BUSINESS DEDICATED EXCLUSIVELY ON-LINE AUCTIONS?
The thinking is that most industries are moving to online platforms and while the traditional sense of art is viewing it via galleries and brick and mortar auctions houses, the online marketplace is changing everything. Any industry without a presence online is going to be extinct soon. Paddle8 is leading the trend of online auctions and online art marketplace and our investors being collectors, artist, dealers or art enthusiasts certainly want to be a part of and contribute to this change.
THIS IS, AT PRESENT, A NICHE MARKETPLACE. DO YOU ANTICIPATE THAT ON-LINE AUCTIONS ARE THE BUSINESS MODEL OF THE 21st CENTURY?
I think it’s a great model that has already proven itself successful and that it will continue to grow as more and more collectors become comfortable purchasing art online which we are already seeing change and grow rapidly. That being said the traditional auction model has been around for centuries and it’s certainly going to take some time to fully change that.
WHAT ARE SOME OF THE GOALS THAT PADDLE8 HAS FOR ITS FUTURE EXPANSION?
As a young growing company, we’ve been very fair in setting, managing and reaching our goals. I know we would like to grow and have more specialists at Paddle8. This will provide us with a greater range of access and knowledge to pass on to our prospective buyers. I would like to see us add more content to our site to give collectors more details about the artwork, there are many ways to achieve this such as more pictures of the artwork, more information about the artist and also specialist suggestions based on previous purchases. We would also like to increase marketing efforts for the themed auction sales in order to give buyers a longer time for consideration before the sale actually launches online.
IN OUR NEXT LRFA POST, I AM VERY PLEASED TO INTRODUCE THE IMPECCABLE ANTHONY ALLEN, A DIRECTOR AT THE PAULA COOPER GALLERY, ONE OF THE MOST ESTABLISHED AND RESPECTED INTERNATIONAL CONTEMPORARY GALLERIES BASED IN CHELSEA, NEW YORK. PAULA COOPER WAS A PIONEER IN THE ART WORLD, THE FIRST GALLERY TO OPEN IN SOHO WHEN IT WAS AN OUTPOST FOR ARTISTS, LIVING AND WORKING IN WAREHOUSE BUILDINGS SOUTH OF HOUSTON.
I APPRECIATE YOUR COMMENTS AND QUESTIONS AND ENCOURAGE THEM!
THANK YOU ALL.