Art Investing for Beginners

Summary

Earn Your Leisure Podcast: Episode Summary

Title: Art Investing for Beginners
Host: EYL Network
Release Date: April 26, 2025

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Introduction to Art Investing

In this episode of Earn Your Leisure, hosts Rashad Bilal and Troy Millings delve into the intricacies of art investing, providing listeners with a comprehensive guide tailored for beginners. The discussion explores the motivations behind art investments, best practices, and the impact of collective purchasing on the art market.

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Personal Journey into Art Investing

Timestamp [01:22]

Rashad Bilal (B):
"The first real piece that I invested in was a piece of art from South Africa from an artist named Nelson Mokomo. It was incredible... That was a lot of money. Just because we haven't really been taught the value... how much was it like $25,000."
Bilal shares his initial foray into art investing, highlighting how personal passion and emotional connection to art can drive investment decisions. He emphasizes the importance of investing in pieces you love, which not only adds aesthetic value to one's space but also fosters a deeper appreciation for the art itself.

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Building the Collection

Timestamp [03:36]

Bilal:
"I realized I was like, I love this. I had just this genuine passion for it... We belong here too... African art, black artists in general, was something that I was like, okay, I love this. These stories are incredible."
Bilal discusses how his passion for African art and his connection to black artists fueled his expanding collection. He notes the significance of supporting artists directly and the cultural impact of such investments, which go beyond mere financial gains.

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The Value of Art Investments

Timestamp [02:22] & [03:07]

Bilal reflects on the appreciation of his art pieces over time. For instance, a piece he purchased for $12,000 later sold at auction for $90,000, underscoring the potential financial returns of art investments. This trajectory not only validates his initial investment but also reinforces his strategy of aligning passion with financial prudence.

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Art Collection Management

Timestamp [05:10] - [07:43]

The conversation shifts to the practical aspects of managing a growing art collection:

• Storage Solutions: Bilal mentions using specialized art storage services to preserve the integrity of his pieces, ensuring they remain in optimal condition.
• Display Considerations: He advises on the importance of proper framing, UV-protective glass, and strategic placement within one's home to prevent damage from light exposure.
• Collective Purchasing: Bilal elaborates on his experience with art collectives, where multiple investors pool resources to acquire high-value pieces. This approach not only makes art more accessible but also facilitates sharing the cultural and financial benefits of collective ownership.

Notable Quote: "When friends come over, they'll be like, your house is like a museum. And that makes me feel so good."
— Bilal [07:08]

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Best Practices for Art Investing

Timestamp [10:28] - [13:36]

Bilal outlines several best practices for aspiring art investors:

1. Invest What You Can Afford: Emphasizes maintaining financial hygiene by purchasing art within one's budget.
2. Due Diligence: Encourages thorough research on artists, galleries, and the provenance of artworks.
3. Insurance: Stresses the necessity of insuring art pieces with reputable insurers specializing in art to protect against potential losses.
4. Education: Advocates for continual learning about the art market, trends, and the factors influencing art valuations.
5. Relationship Building: Highlights the importance of building relationships with artists and other collectors to gain deeper insights and access to exclusive opportunities.

Notable Quote: "Buy what you can afford and then do all the due diligence, the insurance and all that kind of thing to make sure you're protecting your asset."
— Bilal [13:00]

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Legacy and Wealth Building

Timestamp [12:10] - [14:17]

Bilal discusses art investing as a means of legacy building, intending to leave a valuable collection for future generations. He relates art investments to other wealth-building assets like real estate and wine, positioning art as both a cultural and financial investment that can appreciate over time.

Notable Quote: "For me, it's legacy building. So this is what I'm gonna leave behind for my son, my goddaughters, my grandchild."
— Bilal [12:10]

Additionally, Bilal mentions the significance of donating art to prestigious institutions like the Smithsonian, which not only cements his legacy but also enhances the value of his collection through institutional recognition.

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Conclusion and Final Insights

Throughout the episode, Rashad Bilal and Troy Millings provide a nuanced exploration of art investing, blending personal anecdotes with practical advice. They emphasize the harmonious balance between passion and financial strategy, encouraging listeners to approach art investment thoughtfully and conscientiously. By fostering a deep appreciation for art and understanding the market's dynamics, individuals can navigate the art investment landscape successfully, enriching both their personal lives and financial portfolios.

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Key Takeaways

• Passion-Driven Investments: Invest in art you love to ensure personal satisfaction and emotional connection.
• Research and Due Diligence: Understand the artist's background, market trends, and provenance of artworks.
• Proper Management: Ensure artworks are well-preserved, properly insured, and strategically displayed.
• Collective Economics: Consider group investments to access high-value pieces and share the financial load.
• Legacy Building: View art investments as long-term assets that can benefit future generations.

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For those interested in embarking on their art investment journey, this episode serves as an invaluable resource, blending practical guidance with inspiring stories from seasoned investors.

Transcript

[A]

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[C]

How do you get into art investing?

[B]

So you know I used to get these big bonuses. The wine and spirits business is is a bonus based business and I would get these big bonuses and I would you know, buy a watch, buy a purse, buy all the toys, the things, the things I like things. And I remember hearing a record, I think it was a J record and he talked about art and I was like I have not bought that yet. You know it like it pricked my conscience. And the first real piece that I invested in was a piece of art from South Africa from an artist named Nelson Mokomo. It was incredible artist and the reason why I say invested in it is because it was literally half my bonus and I and it was hard for people to understand. They were like you're going to spend what you're going to. What. What are you talking. That's a lot of money. Just because we haven't really been taught the value how much was was like $25,000.

[C]

And who educated you to know that that was something that you should buy?

[B]

Well in in with that purchase I just loved it.

[C]

You just looked at it and just.

[B]

Like I loved it and I I researched the artists and it I Mean, it fell in line with just kind of me falling in love with South Africa too, you know, And I loved it. So I think the first thing that I always like to tell people is even though I invest in art, only invest in what I love, like, if I don't love it, I'm not really going to spend my money on it. And so I've been really fortunate to get to know a lot of artists directly, buy from artists directly. So you circumvent the. The whole gallery and all that kind, and you're supporting the artist. Like, the artist is getting 100%.

[C]

How much is that worth now?

[B]

You know, I don't know.

[D]

That's interesting, right? I see it. I love it.

[B]

Definitely worth more than what I bought it for.

[D]

I'm assuming that maybe it was Picasso. Baby's the J song. That might have sparked it. But does that now spark your love for art, or did it just transition to South African art? Right. Did you start studying American artists, artists throughout the world, and now this becomes a passion for you based on that one purchase?

[B]

Yeah. You know what I realized Art for me was I just got lost in it. Like, I realized I was like, I love this. Like, I had just, like, this genuine passion for it. I didn't grow up going to museums. I didn't grow up going to art exhibits. I didn't grow up in a house where there was art. And so I think for me, I was like, oh, wait, we belong here too. You know, that. It was really that. That fueled me. I was like, wait, this is a space that we belong in as well. And they're such an incredible art community. So I also was enjoying, like, getting to meet, you know, and those people are, like, involved in some cool stuff, you know, So I think it was that definitely, you know, African art, art, black artists in general, you know, was something that I was like, okay, I love this. These stories are incredible. And then it became like, yeah, like, you know, I remember buying a piece. You asked about the value. I bought a piece for, like, $12,000, and I remember seeing an auction for the artist, and her piece sold for $90,000. And, like, I have one of her bigger pieces, earlier works that I bought for $12,000, that's clearly gone up in value. So I then also started just to understand, like, oh, okay, this is how that works. And then I think when you study, really wealthy people, really wealthy people have a few things in common. They have real estate. A lot of them have a lot of investment in wine, and they invest in art And I was like, okay, this all kind of makes sense for me, you know, this is the space that I play in anyway.

[C]

So how many pieces do you have roughly?

[B]

Oh, now I probably have over 40 or 50 pieces of art and everything. Not just, you know, I have sculptures, I have vases, I have.

[C]

I mean, you know, where do you keep it all?

[B]

It's everywhere. I mean it's in my bathrooms, it's on the floors.

[C]

But does it ever get to a point? Because it's like, all right, you could invest in a variety of things that artists somewhere where it has to be kept. Right. So after a while it's like you can't really fully appreciate it, I don't think. Because you can't put it on your wall. You can't put 50 pieces of art on one wall. Right. So it's like you could put it in your office, you can put it in different places. But when you really start to get a lot of art, I'm always curious to know, like what are people doing with all of the art that they are. They just hoarding it in the basement.

[D]

Take the Dame Dash role.

[B]

Yeah, I mean, listen, people do have, you know, art storages that are specific for art. Just like they have wine storages. For me, I'm working to sell a lot of wine so I could buy a nice big house so I can have all my art up in it, you know, I mean now it's cause.

[C]

The art, the art storage that kind of. I don't understand that. I used to go, I used to go to art school when I was young. But I don't understand art storage because the point of art is to be appreciated. And if you're just storing it, I feel like it's actually disrespectful to the art form. Right. Cuz now you've taken the, the beauty out of it and now it's just become like a file cabinet.

[B]

Yeah.

[D]

Things are double entendre. You use the word appreciated while it's stored. It is appreciating.

[B]

Appreciating.

[D]

I get what you're saying.

[C]

Art from an artist standpoint. I understand the business.

[D]

Yeah.

[C]

But art should always come first. The business should come second.

[D]

But some people create galleries.

[B]

Right?

[D]

They create their own galleries, which I.

[B]

Mean I know people who have like bought the houses next to their house and the house next to the house.

[D]

It's for art, it's a gallery.

[B]

Which is amazing. Right. So I'm with you like part. And when you ask me like the buying, you know, my rationale around buying. I only buy what I love because, like you, I want it up, I want to see it, I want to appreciate it. I also want to share it with people. So, like, when friends come over, they'll be like, your house is like a museum. And that makes me feel so good. You know what I mean? Like, I'm like, yeah, so everybody does it for a different reason. But what I could tell you is, again, one thing I learned is that people that understand wealth, they into art, they into wine, and they into realism.

[C]

Well, one thing I learned about art is that if you put it in your office, it's a tax write off.

[B]

It is a tax write off.

[D]

Yeah. So I was saying, the. One of the places that we definitely know that your art is going to show up is the Smithsonian.

[B]

Yes.

[D]

Talk about that. I mean, that, that's something that people will be able to frequent and you go down in history forever, right?

[B]

Yeah. That's exciting. So myself and 10 collectors got together. We, we've now acquired three pieces together. And it's, it's our way of, you know, collective economics. And we purchased a piece, a Bisa Butler piece, that we then donated to the Smithsonian Museum in D.C. and so my name will forever be on the museum walls at the Smithsonian as a donor of the piece. And even that little thing, right. Like we talk about, like, having the art in your home and wanting to see it. I remember thinking, like, wow, donating to a museum. But that's really also a big part of, you know, the art world, art collecting and also increasing the value of your collection. So my collection inadvertently increases in value because I own a piece in, in a museum. And, and people who are in the art world, they know all these little nuances.

[D]

Yeah. Do you see, because we talk about it in real estate, right. A lot of times if, if people can't afford the property, let's have a collective. Maybe it's five people and we make the down payment or we go into. Do you see that in the. Is that something that happens in the or often, especially amongst our community?

[B]

You know, I don't want to misspeak. You know, the collective that I'm a part of, that was the first instance that I had ever heard of it. I'm sure people are doing it. I just don't know. You know, the, the two pieces we bought, they were both $150,000 each. They go together. It's Adam and Eve by Harmonia Rosales. So the, the total price of the work was $300,000. And when we all thought about it. We were like, I can't do that, but I could do this. And so 10 of us got together and purchased it. Those two pieces have been on display at different museums. It's actually at the Spelman Museum right now. And so we're allowing the work to just tour so people get to experience it. And once we did that one, we were like, all right, let's keep doing this. This is amazing. So I. I don't want to say that it. It does happen, but I don't want to say that it doesn't happen. I just wasn't aware of it. I know that when we had the opportunity to do it together, I said, come on, y'all, let's do this. Because it was $30,000. But at the end of the day, I'm part owner of $300,000 worth of art.

[D]

Yeah.

[B]

And that's just that one buy.

[C]

So what are, like, some best practices for people that want to get in art? Like, is it, like, always go through a art dealer, have insurance? Like, you know, like when you buy a watch. Right. Like, you can. It's best practices to go through authorized dealer as opposed to just a jeweler.

[B]

Right.

[C]

It's best practices to have insurance on the watch.

[B]

Right.

[C]

What are some of the best practices for art buying?

[B]

Yeah, I mean, again, I've been really fortunate. I've been able to buy a lot of art directly through art, through artists. And the reason why I say fortunate is because, one, you get to know who. Who you're buying the work from. I mean, this work is in your home. It's energy. Right. A lot of these pieces have stories. These artists may be going through different things while they're actually creating the work. And so, you know, I'm an advocate for people that want to get to know the artists, if you can. It's worked for me secondarily. You know, I've gotten to know some galleries that I respect, that I think are doing good by artists. So, you know, it doesn't hurt to have some galleries in your repertoire only buy what you can afford. And so I would say that that's my biggest advice to people. You know, I've never financed any art, although you can. You know, there are financing programs for art, but I just like to think for good financial hygiene, buy what you can afford. That's worked for me. You absolutely have to insure your art, and you have to make sure that it's a reputable insurance that specializes in art insurance. You need to think about where the art is gonna be in your home. A lot of light is not friends, is not art's friend. Like light. Yeah.

[C]

So it ruins it.

[B]

It can. Yeah, it can. So, you know, making sure that the art is in a position in your home that it isn't getting damaged, making sure that you're framing with a reputable framer that's gonna talk to you about UV glass versus museum glass. I mean, this is all this stuff that goes into thinking about preserving your art. And then, you know, I have not been someone who's gotten into the business of selling my art. I know people that are in that business of selling. I can't say that I would never do it. For me, it's legacy building. So this is what I'm gonna leave behind for my son, my goddaughters, my grandchild, you know what I mean? Like, this is really legacy building for me and wealth building for them. So I think it's just making sure you get educated like you do in anything that you're going to be investing your money. And the last thing I'll say is the 10 people that I invested in art, I respect all those people. I, I, I expect their Prof. Respect their portfolios, right. What they've done with their money, I would have never just gotten with 10 people and bought some art that I didn't know. I felt were a good fit in what I was trying to do because that's a relationship, you getting into a, a business relationship with them. But I think the biggest thing is buy what you can afford and then do all the due diligence, the insurance and all that kind of thing to make sure you're protecting your asset.

[D]

So when it's touring, museums are paying to have it on display. How, how does that work?

[B]

Yeah, so sometimes you will get paid by museums to have the work. Sometimes it's that you're donating it because you want the, the connection, you want to lean into the equity of the, of the, of, I think, the institution. Right. A lot of these institutions have incredible equity. Smithsonian, for example. I mean, for me to say that I've been collecting for five, six years and I already have my name in a Smithsonian museum is like a big deal. So, you know, it's a mix. But yeah, there are times when institutions will pay you to, to actually have your art in their exhibits.

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