Artist pension trusts, how they work, with expert Sarah Murkett, founder of Murk & Co.
THE ARTIST’S RESALE RIGHT (ARR) IS AN INTELLECTUAL PROPERTY RIGHT THAT ENTITLES ARTISTS TO A ROYALTY PAYMENT EVERY TIME AN ORIGINAL WORK OF ART IS RESOLD BY AN AUCTION HOUSE, GALLERY OR DEALER. IT WAS FIRST INTRODUCED INTO THE UK IN 2006. ALTHOUGH IT HAS ITS ADVANTAGES IN THEORY, IT CAN BE A BURDEN ON THE ART AND AUCTION MARKET WITH NEGATIVE EFFECTS BOTH ON THE ACCESSIBILITY OF WORKS AND ON THEIR PRICING. OVER THE YEARS, IN THE UNITED STATES, DIFFERENT LAWMAKERS HAVE CHAMPIONED FEDERAL EFFORTS TO ESTABLISH THE RIGHT IN THE U.S. AND ARE FACED WITH THE SAME CONFLICTS.
ANOTHER CONCEPT THAT WAS DEVELOPED AT THE TIME WAS THE ARTIST PENSION TRUST OFFERING LONG-TERM FINANCIAL SECURITY AND INTERNATIONAL EXPOSURE TO SELECT ARTISTS AROUND THE WORLD.
SARAH MURKETT, FOUNDER AND PRESIDENT OF MURK & CO., WAS INSTRUMENTAL IN THE TECHNICAL AND AESTHETIC DEVELOPMENT OF BOTH MUTUALART AND THE ARTIST PENSION TRUST. IT PROVIDED HER WITH A PROFOUND KNOWLEDGE OF THE WORK OF MANY ARTISTS IN THE APT COLLECTION, CURATORIAL EXPERIENCE AND A SOPHISTICATED KNOWLEDGE OF A BUSINESS BASED ON A DATABASE DIGITAL PLATFORM, ALL INVALUABLE WHENSHE CAME TO FORM HER OWN BUSINESS, MURK & CO.
THE LRFA BLOG IS HONORED TO SHARE HER EXTENSIVE KNOWLEDGE AND PROFESSIONAL HISTORY AT MUTUALART AND THE ARTIST PENSION TRUST WITH YOU TODAY.
SARAH, WELCOME BACK!
TELL US ABOUT YOUR TIME AT MUTUAL ART. HOW IS THE COMPANY STRUCTURED AND WHAT IS THE SCOPE OF SERVICES IT PROVIDES? IT SEEMS TO OFFER A RATHER COMPREHENSIVE VIEW OF THE ART MARKET, AUCTION RESULTS AND APPRAISAL SERVICES AND ALSO TO REPRESENT THE SALE OF ARTWORKS FROM A BROAD RANGE OF PERIODS.
I was introduced to MutualArt through my friend Candice Madey of Stellar Projects whose ex, Ayal Brenner, was the CEO of the company. MutualArt was looking for someone who could source secondary market material to offer to their global network of collectors. The company was started by tech entrepreneur Moti Shniberg, who had also founded the Artist Pension Trust (APT), whose mission was to support artists through collectivized pooling of art, invested by the artists themselves into a Trust, for eventual sale, the proceeds of which were to be distributed back to the artist members. At heart, the impetus for MutualArt was to build a base of collectors to potentially sell artworks from APT, which they boasted as being the largest collection of contemporary art in the world. The way they devised to do this was to build a website that aggregated information about artists, including upcoming exhibitions, current news and most notably auction results.
As with many tech companies, it was the interests of the collectors (the data), derived through the artists they followed and their behavior of the site, that was the ultimate value proposition. They brought me on as the Director of Sales for both companies, and I was charged with building sales platforms for both MutualArt and APT, including trying to identify and optimize synergies between them.
I leveraged my network and partnered with collectors and dealers to offer individual works and larger curated sales on and off the MutualArt website. I helped to develop original content and edited a weekly MutualArt newsletter, which would often feature APT artists. I familiarized myself with the works in the APT collection and initiated sales for the company, which ultimately lead to the first payouts to member artists. Unfortunately, there were 5 different CEOs in the 4-years that I was there and the infrastructure and vision for the two companies never came together.
WHAT WERE THE HIGHLIGHTS OF YOUR JOB AT MUTUALART. WHAT WERE THE AREAS IN WHICH YOU CONCENTRATED AND IN WHAT WAYS DID THIS INCREASE YOUR KNOWLEDGE AND FAMILIARITY WITH THE CONTEMPORARY ART MARKET?
My favorite project that I worked on while at MutualArt was the online selling exhibition that I put together in 2014 of video art from the APT collection called, “We’ve All Got Issues”. There was a concurrent brick and mortar manifestation at the NEWD Art Show, a short-lived artist focused fair in Bushwick, which was organized by Kate Bryan and Kibum Kim, who invited us to participate.
The inspiration for the show was the APT collection itself. There was a lot of video in the collection and while most artwork does not readily lend itself to a screen, I thought that video by APT artists and the MutualArt selling platform, which lived on a screen, made for a natural pairing. I spent a Xmas holiday watching every video in the collection and from that, “We’ve All Got Issues” was born featuring work by artists such as Brian Alfred, Kevin Cooley, Keren Cytter, Rico Gaston, Kate Gilmore, Annika Larsen, Kalup Linzy, David Shrigley and Mark Titchner.
Needless to say, the show was not a commercial success. What it taught me is that no matter how broad the platform for promotion, an exhibition in and of itself is not enough of a machine to create a market for work for which there is not much of a market to begin with. This is the hard work that the galleries that represent these genre pushing artists do every day.
HOW DID THE ARTIST PENSION TRUST WORK AND HOW WERE THE ARTISTS SELECTED?
The Artist Pension Trust story is actually quite tragic. It was a noble undertaking started in 2004 to provide financial security for artists into their old age. It was to be a kind of retirement plan for artists, into which the only asset that member artists needed to invest was their art. Every artist was to contribute 20 artworks over 20 years and the number of shares they had in any distributions was determined by the number of artworks they had “deposited” in the Trust. If selected well, some of the art was bound to go up in value over a minimum 10-year hold period. The model said that only 5% of the artists needed to do well in order for everyone to benefit in the long run.
I still think it is a great idea, and that this version was just poorly managed, but poorly managed it was. Here is a link to a story outlining the saga:
After closing a big round of financing, with new investors who wanted to see profits, management decided that a selection of the best works from the collection should be sold at auction. It was my opinion that the artworks in the collection had not really established a demand in the market such that they would do well at auction. Additionally, I did not think that APT’s artist members, or their galleries, would be supportive of the initiative. I believe that I lost my job over this opinion. The great news was that the sale in New York had a very high sell-through rate, but most of the work sold at the low estimates, which was well below the artist’s retail prices. This bore itself out, much as I had predicted with artists and their dealers up in arms, so much so that APT pulled out of the follow-up sale in London.
SARAH, THANK YOU. SARAH IS A WEALTH OF KNOWLEDGE IN SO MANY ASPECTS OF THE BUSINESS OF ART. WE LOOK FORWARD TO A CONTINUED DIALOGUE ON THE STEPS THAT LED UP TO STARTING HER OWN COMPANY/
AND THANK YOU TO THE MANY LRFA BLOG FOLLOWERS FOR YOUR COMMENTS AND SUPPORT.
Thank you, Leslie for this series. It’s a fine refresher to the varied aspects of the practice, as well as to artists’ and collectors’ concerns alike.
Kudos all around.
I’m very pleased that Sarah Murkett was willing to contribute. Thank you!