How would you value an art business if someone wanted to buy it?

Most people would try to value an art business by looking at inventory, annual sales, how much work is created per year, and the percentage increase in prices over the last three to five years. However, this calculation is fundamentally incomplete because it doesn’t account for the collector list—which is the single most valuable asset an art business can have. A savvy buyer evaluating an art business would feature the collector list heavily in the valuation. The size, engagement level, and purchasing history of that collector list represents predictable future revenue and is far more valuable than just looking at current inventory or sales figures.

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Asked by general teaching · Answered by Patrick Shanahan · art-marketing-podcast · 2021-06-07