Our goal at Inversion Art is to build a long-lasting organization that provides support and opportunity to thousands of great artists. We believe strongly that the best way to do that is to create a self-sustaining company that aligns its success with the success of the artists it serves. Although nonprofit organizations play a critical role in supporting artist communities, the visual arts are lagging behind other creative industries like fashion and music that have stronger investment models for breakout artists and we believe it’s time for that to change.

After interviews with over 200 artists and arts professionals, Inversion Art has developed a new model for investing in artists that we believe aligns our interests with theirs, as well as with the gallery ecosystem we aim to partner with. We do this in two ways:

1. Short Term: We align our short and medium term goals with artists by providing services that free them up to create more work and income, in exchange for a modest share of that income. If an artist spends 5 hours a week on registrarial management, website and social media updates, and accounting or legal matters, that’s 20 hours a month they could be spending creating more work.  By freeing up artists and running their studio in a streamlined manner, artists and their galleries can stay focused on creating work and placing it with great collectors, respectively. For galleries, this is all upside, as Inversion Art’s 15% income share does not come out of the sale price of work, but out of the net payment to artists. It gives smaller and mid-sized galleries a better opportunity to compete with larger galleries who often poach successful artists by offering services like ours. For artists, our support increases their earning potential and ensures that they can count on five years of support if they want to pursue more ambitious projects.

2. Long Term: In order to align our interests long term, we see an investment in artists’ work as equivalent to buying equity, found in other investing models. Since art values typically only rise if the artist continues to maintain a long, steadily improving practice, Inversion Art is highly motivated to provide support that prioritizes strong careers over many years. This means doing our best to exhibit the work we own, continuing to drive interest to our artists from collectors, curators and other supporters, and advising them in a way that promotes good long-term decision making. Some collectors prioritize short term gains. At Inversion, we have self-regulated these types of behaviors by guaranteeing a five-year holding period and agreeing never to be the first to take an artist to auction. The benefit to our organization in having fiercely pro-artist policies is that we become a trusted, more desirable collector to sell to, which will attract better artists.

This model is new for the art ecosystem but has been proven to create tremendous value in other industries. The most successful early stage investment firm for technology startups uses a similar format and has been responsible for the launch of Dropbox, AirBNB, Coinbase, Reddit, and thousands of other companies. Our program was inspired by those successful startup investment programs, of which our founder’s last company was a recipient.

We know that many artists’ work will not see massive increases in their art values. The same is true for venture capital models. The massive gains investors receive by investing in a company like Dropbox allow them to invest in and support a huge number of aspiring entrepreneurs who receive all of the same benefits whether they achieve the same outcomes or not. The portfolio approach of Inversion Art expects similar outcomes where our big wins help us provide great support to everybody we work with.

A Snapshot of Our Expectations

Our goal in 10-12 years is to purchase nearly 3,000 works from over 1,000 great artists. From those 3,000 works, we suspect that 90% will never see values above $200,000 and that’s okay. With just 9% of works selling for more than $200,000, and only 18 out of 3,000 ever selling for more than $1 million, we expect the collection we acquire for $30M to appreciate to between $305-$500 million. Of that, we’ll pay $30M+ in artist royalties, plus set aside another 10% for our artists to distribute as they see fit. As the company begins to realize our best returns, it will have more resources to provide an even greater number of services and benefits to more and more artists.

In designing Inversion Art, we considered past attempts to create artist support organizations and analyzed where some of them fell short. Most people in the arts are familiar with a project called Artist Pension Trust, which aimed to create a collective of artists that would donate works, and then distribute the eventual profits to all of the artists as a retirement fund that similarly relies on a few big winners to succeed. Although APT seemed like a noble effort undertaken by good people, there were at least two major reasons why it struggled to achieve its goals. Our model is designed to combat those problems.

The first is that the works artists donated to the trust were often not the artists’ best works. This is also true of many residencies whose business model is to acquire artwork donations as payment for their services. At Inversion, we are not asking artists to donate any work. We pay full market price for the initial works we acquire and we pay a 10% artist resale royalty on any eventual sales. This makes it far more desirable and even a smart long term investment for artists to sell great works to us.

The second issue with APT was that it is incredibly expensive to maintain a large collection of art. There are storage, crating, insurance, appraisal, and many other expenses associated with holding works over years or even decades. It also costs money to exhibit these works, which is crucial to improving provenance and long term value. Without another revenue stream, these costs can be too burdensome over time and the returns for works may not come fast enough to offset them, forcing the trust to make bad, short sighted decisions. This is why having our artist services division generate a diversified stream of revenue is crucial to the long term sustainability of Inversion Art and allows us to be patient in the way we manage our collection.

Overall, we believe Inversion Art provides an opportunity for the art ecosystem to catch up with other industries in terms of the support and alternative paths to success that it offers. We believe strongly in iterating on this vision to meet the needs of artists and the ecosystem over time, and we’re committed to the philosophy that rising tides should lift all boats. We also believe in transparency and welcome any questions or feedback that artists or others in the space might have. We know that new ideas and new models for working with artists are often met with scrutiny, and we look forward to maintaining a dialog with the artists we aim to serve and the other partners in the ecosystem who share our love of the arts and want to see an ecosystem where all of us thrive.

To learn more about the people behind inversion art, check out our team.