In “The Story of OJ,” a song from his thirteenth studio album 4:44, Jay-Z lays down a financial roadmap for those who want to live and die rich.
In a time where we’re told to buy pearls and gold and walk around with thousands in our pockets at all time to attract riches, one of the world’s most well-known hip hop artists becomes an unlikely hero as he drops beats and sound investment bombs.
Among Jay-Z’s most salient advice is to buy art. In his lyrics he raps:
“I bought some artwork for one million
Two years later, that shit worth two million
Few years later, that shit worth eight million
I can’t wait to give this shit to my children”
It’s good advice in theory, except for one problem–not everyone has a cool one mil to drop on a piece of art. But that doesn’t mean you can’t build a wildly profitable art collection of your own. In fact, now’s a great time to do it.
According to the Deloitte Art & Finance Report 2016, 78% of wealth managers surveyed (a significant jump from 55% just 2 years before) believe art should be included in a wealth management portfolio, and 73% said their clients wanted to include art in their portfolio.
As an art historian turned entrepreneur, I know first hand if you know what to look for, art can be some of the most high-yield ROI investments on the market. Here are 5 strategies to help you start your own profitable art collection, without dropping 7-figures on a single piece.
1. Attend MFA graduation exhibitions and find artists-to-watch
MFA grad exhibits are goldmines if you want to spot artists on the rise. With a competitive barrier to entry (on average, programs receive hundreds of applicants and accept less than 3.5 percent), candidates graduating from these programs are the best of the best.
But even in the best of the best, there are ways to spot unicorns: Look at the roster of artists for those who have received grants to support their work, a long exhibition history record, PR mentions, or any awards. While most students have a guaranteed stipend, those who have additional gold stars on their resumés are most likely to develop a long and prominent career as a professional artist, so their work is likely to grow in value over time.
2. Use Instagram to find popular emerging artists
There are two ways Instagram can help you to identify emerging artists. First, use city-specific hashtags (i.e.: #chicagoartist or #brooklynartist) to find artists with large followings who show their work in galleries or museums.
The last bit–galleries or museums–is key, because there are several popular self-taught artists on Instagram, but being able to get your work into a show is a great marker of credibility. It’s also an indicator that the artist’s worth on the market is likely to increase.
Jeremy Wolff (@jwolffstudios) is a great example. A full-time artist since 2014, he’s been featured in Forbes and his Instagram feed is full of photos not only of his work, but its appearance in various gallery spaces.
Second, find galleries that feature the work of emerging artists. These smaller galleries are great to Insta-stalk, because they only choose the best of newbie artists. A lot of artists are vying for those spaces, so if a gallery accepts a submission, it’s because the artist’s work is usually well above standard. You can follow artists on social media to track if they’re getting more shows or being written about in media.
3. Look at art magazine websites
Pay attention to artists who receive press on reputable art websites (Art in America, Canadian Art, etc.) particularly if it’s their first feature. Reporters for these publications actively pay attention to rising art stars in an attempt to get to them “before they’re famous” and establish an ongoing relationship; as well as to highlight their work as relevant to the tone and trend of where art is headed at any given moment. The added PR helps artists sign with galleries, get grants, etc. This means their prices are going to skyrocket and the value of earlier works will increase.
4. Look for ‘new signings’ or ‘debut shows’ at commercial art galleries
Artists who have just been signed by commercial galleries are likely to see a boost in value on the market, especially if their work is represented by a large gallery that is regularly covered by notable news networks and art publications.
The prestige of being an artist with reputable galleries means an artist’s work is more likely to sell. The added PR skyrockets their visibility and presence within the art world, which means their dollar value over time will increase, too.
5. Find popular, but fringe niches
A popular, but fringe niche is a segment of the art market with considerable consumer demand, but isn’t widely collected by the general art buying populace. An example is Inuit Art–extremely popular since the 1950s, collectors of Inuit art are rabid fans who tend to have intimate knowledge of the artists and the annual print collection sale is a literal frenzy.
Because the works are often unique or extremely limited edition, they can be resold for much higher prices just a few years down the road, particularly works by canonical artists. Buying pieces in these fringe niches with a specific but enthusiastic consumer base is a great buy because they make for easy, profitable resells.
Ultimately, creating an art collection should be a personal project–you should want to hang all the pieces you buy in your home or your office–but you can do it strategically to yield a high ROI, too.
Erika Ashley is a Montreal-based author, TV producer, and leadership coach for millennial women who want to turn their business into a movement. Before starting her business in 2015, she earned a BFA and MA degree in Art History from Concordia university, and she has a decade of experience in the art, management, and publishing worlds. Join her free Facebook Group for impact-driven entrepreneurs. Connect with @iamerikaashley on Twitter.