When saying no to €1.5M is saying yes to the future of the art market
In the startup world, revenue isn't just king - it's oxygen.
Every transaction matters, every deal could be the one that propels your growth forward. But what happens when that potential comes with red flags?
Let me share a recent story that perfectly captures what we stand for at Artscapy, and why sometimes saying "no" to money is actually saying "yes" to something much bigger.
The €1.5M question
Recently, we faced what many would consider a founder's nightmare: turning down a €1.5M transaction.
It would have been a great transaction, two high profiled works a Yayoi Kusama and a George Baselitz.
The reason? The potential buyer couldn't pass our banking grade Know Your Customer (KYC) procedures.
For many players in the art market, especially growing ones, this might sound absurd. After all, the art world has historically operated on handshake deals and personal relationships (yes, even in 2024!). A €1.5M transaction could transform a company's trajectory. So why did we say no?
The real cost of easy money
Let's be honest here - the art market has a reputation problem. Money laundering, fraud, opacity... these aren't just fancy words thrown around by regulators in boring compliance meetings. They're real issues that create actual barriers to the market's growth and accessibility.
When companies choose short-term gains over proper due diligence:
- They expose sellers to potential legal and financial risks
- They perpetuate the market's reputation for opacity
- They undermine efforts to professionalize the industry
- They put their own future at risk
And trust me, I've seen this movie before - it never ends well.
Why our "No" matters
In today's art market, two forces are colliding: the traditional way of doing business and the urgent need for professionalization. At Artscapy, we've built what we believe are the industry's most robust KYC procedures. This isn't just compliance for compliance's sake – it's about creating a sustainable future for art trading.
The hidden value of strong processes
When we implemented our KYC procedures, I knew they might cost us some business. What I didn't expect was how they would become one of our strongest competitive advantages:
- Trust building: Our sellers know their interests are protected
- Risk management: We avoid potential legal and reputational risks
- Market leadership: We're setting new standards for industry best practices
- Long-term value: We're building a platform for sustainable growth, not quick wins
The bigger picture
This isn't just about one transaction or one company. It's about the future of the art market itself. For too long, the industry has operated with insufficient oversight, creating barriers to entry for new collectors and opportunities for bad actors.
The real innovation in the art market isn't just about moving transactions online or creating new technological solutions. It's about fundamentally changing how business is done.
Building a better market
Our decision to decline this transaction reflects our broader mission: to create a more transparent, accessible, and professional art market. This means:
- Implementing robust compliance procedures
- Protecting all parties in every transaction
- Setting new standards for market practices
- Choosing long-term integrity over short-term gains
The cost of integrity (and why it's worth it)
Some might see our decision as leaving money on the table. I see it differently. Every time we enforce our standards, we:
- Protect our sellers from potential risks
- Strengthen trust in our platform
- Demonstrate our commitment to market transformation
- Build long-term value for all stakeholders
Looking forward
The art market stands at a crossroads. One path leads to more of the same: opacity, risk, and limited growth. The other leads to professionalization, accessibility, and sustainable expansion.
At Artscapy, we've chosen our path. Yes, saying no to €1.5M was difficult. But saying yes to the future of art? That's the easiest decision we make every day.
Because here's the truth: in an industry plagued by opacity and questionable practices, transparency isn't just a nice-to-have – it's our competitive advantage. And we're not just talking about it; we're living it, even when it costs us.
Want to learn more about how we're transforming the art market? Read more on artscapy.com or reach out directly to discuss how we can work together to build a better art market for everyone.
Alessandro De Stasio is the CEO and Founder of Artscapy, a platform committed to transforming the art market through transparency, technology, and trust.
