How Masterworks pulled off a unicorn valuation of over $1 billion

Article Summary:

• Masterworks has changed the art investment world by providing a digital platform where users can invest in famous works of art.
• In October 2021, the company raised $110 million in Series A funding and announced a unicorn valuation north of $1 billion.
• Masterworks has become the largest contemporary art buyer, opening up the exclusive realm of fine art to the everyday investor.

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Founded in 2017 by CEO Scott Lynn, Masterworks has changed the art investment world forever by providing a digital platform for investors to invest in and trade shares of famous works of art from the likes of artists such as Banksy, Picasso, and Basquiat — without having to spend a fortune.

Back in October of 2021, the spearheading company raised $110 million in Series A funding, led by Left Lane Capital and other investment firms, including Galaxy Interactive and Tru Arrows Partners.

Since then, Masterworks has become the largest contemporary art buyer, opening up the exclusive realm of fine art to the everyday investor, not just the ultra-wealthy. In addition to allowing people to easily invest in art for a fraction of the price, Masterworks solves the problem of authenticating and storing the artworks for you, something that would typically cost an investor a pretty penny.

As of 2022, Masterworks reports being appraised at over $1 billion, a unicorn valuation achieved through a combination of factors, including:

Art’s Attractive Historical Price Appreciation

As calculated by the Masterworks all art index, contemporary art’s impressive track record of outpacing the S&P 500 by 131% over the last 26 years and boasting an average 13.8% price appreciation — may be one of the main draws attracting investors to this market. Note that though this may not represent the experience of everyone investing in contemporary art, it is a noteworthy trend. You should also consider that this type of investment may be riskier when compared with other investments and is about capital appreciation rather than a recurring income stream. Once art is acquired, it’s generally not sold for 3-10 years, which is why this type of investment is generally a longer term play.*

First Mover Advantage on an Exclusive Asset Class

Masterworks was the first company to provide a platform for investing in shares of iconic artworks, giving them an early lead in the market and establishing them as a pioneer in the blue-chip art investing space.

Strong Track Record

Masterworks’ strong performance track record has helped build investor confidence and has played a great hand in attracting more investors to its platform. All of Masterworks’ sold artworks have been quite profitable. In fact, the last three exits delivered +10%, +14%, and +35% net returns. With an A+ BBB rating and a reputation for strong customer service, Masterworks provides investors with the tools and resources they need to enter the blue-chip market with confidence.

Getting started

If you’re looking to invest in blue-chip art without breaking the bank, Masterworks is an excellent option that provides investors with comprehensive research, expert insights into the current art market, top-notch support resources, and a well-designed, easy-to-use digital interface.

To get started, complete Masterworks’ quick form using this link, and a member of their team will be in touch to talk about your investing goals and guide you through the next steps.

 

*Past price trends are not indicative of future price trends and are not intended to be a proxy for historical or projected future performance of any specific artwork or Masterworks shares. Additionally, note that all investments may involve risks.

The information provided on this page is for educational purposes only and is not intended as investment advice.

This article is sponsored by Masterworks. For more information, see Masterworks' important disclosures at: Masterworks.com/cd.