“Does the Art World Need Transparency?” is the topic of the next Art Innovators Alliance event on 24th September. In anticipation, we asked Christine Bourron, Founder and CEO of Pi-eX to talk to us about how her company helps fine art buyers and sellers make more informed choices. Find out more about Pi-eX here.
First of all, tell us a little bit about Pi‐eX, how did it come about as a company?
Pi‐eX, which stands for Passion Investment Exchange, is a London based company that helps art collectors and art investors better manage liquidity, risk and financial volatility when buying and selling art. As a financial broker-dealer, we are directly and fully regulated by the Financial Conduct Authority (FCA), the UK financial regulator, since 2016.
I started Pi‐eX Ltd in London in 2014 as I could see the need for better data transparency, analysis and financial tools for those who want to invest in the fine art market. My involvement with the art market dates back from the end of the 1990s when I created PaintingsDIRECT.com, the first online art gallery in New York.
My vision for Pi‐eX is that it will participate in making the fine art market a sustainable investment opportunity by providing those who see art as an investment with the knowledge and tools required for successful investment strategies.
Do you think that the art market has a transparency problem?
Yes, I do think that the art market has a transparency problem. The art market is an extremely opaque market lacking transparency both for qualitative information (provenance, authenticity, conditions, etc) and quantitative information (pricing, volume traded, volume sold, volume unsold, etc).
I believe the lack of transparency is a problem for the art market as the opacity of the market results in a very serious limitation to its growth.
How does Pi‐eX help buyers make more informed choices?
To help fine art buyers and sellers make more informed choices, Pi‐eX offers the following:
- Standard reports based on a proprietary database of auction sales:
Pi‐eX’s methodology is based on the analysis of buyers’ and sellers’ behaviours at auctions. Leveraging Pi‐eX’s proprietary and exhaustive database of auction sales results at the top three auction houses for the past 13 years, Pi‐eX’s reports allow art collectors and investors to understand the latest trends at an auction house, the direction of a particular repeating sale, the growing or slowing attractiveness of an artist, etc.
- New options to hedge the financial risk when selling or buying art at auctions:
Pi‐eX offers art sellers and art buyers financial instruments named Contract on Future Sales (CFS). CFS allows sellers to hedge part of the future price they are hoping to obtain for their artwork at a future sale. By using CFS, sellers can limit their risk of not obtaining the price they want when selling at auctions. At the same time, Pi‐eX’ CFS offers art buyers the opportunity to reduce the risk that they may have to buy a specific artwork for more than they initially planned for.
What’s the biggest misconception people have about the art market?
To me the biggest misconception about the art market is that people think investing in art is a safe investment. There is this image that while the financial markets may be collapsing, those who invested in art will be safe because they can run with their painting under the arm.
This false sense of safety could not be further from the truth. Too often, new fine art investors do not do their homework and learn too late that investing in art is neither safe nor a sure thing. This is very unfortunate both for the investors who may lose serious capital and also for the fine art market as disappointed investors tend to run away from the market, which in the end seriously limits the growth potential of the market.
Do you think there are circumstances where lack of transparency can be a positive thing?
I personally cannot see anything positive in the lack of transparency in the fine art market.
Join us on 24th September in London for the next Art Innovators Alliance event. The panelists include:
Philip Hoffman, Founder & CEO of The Fine Art Group
Christine Bourron, Founder & CEO Pi‐eX
Ivan Macquisten, Writer, Commentator, Analyst, Collector
Moderated by Bernadine Brocker Wieder, Vastari Co-founder, this will be a lively and topical debate.
Tickets free, limited capacity, bookings essential.
Here is a write up of the previous Art Innovators Alliance event.