Rising Emerging

111% COMMITTED

AGGRESSIVE RISK TOLERANCE


This fund will primarily invest in emerging art. Emerging art is defined by young up and coming and under the radar artists, who are expected to rise to be the next Andy Warhol. They are often underappreciated yet critically important, pushing boundaries with new mediums, ideas, and creative processes, creating works of art that will define the art of the 21st Century. Most of the artists started working in the past 10 years. 


EMERGING MARKET


Art has taken an exciting turn in the new millennium, pushing boundaries, raising questions, and experimenting with new media and methods of art creation. The term “emerging” generally refers to the work of young artists (under 40) created since 2000 or critically important yet underappreciated artists on the path to recognition.

 

There is no defining style for emerging art. Some of these up-and-coming, innovative artists are claiming public space for themselves with performance art, street art, and other creative interventions, turning social media on its head, exploring the meaning of a post-internet world, or opening up conversations about politics, climate change, equality, globalization and other contemporary issues. However, much of this experimentation still takes place within painting and sculpture practices.

 

For example, a 2014 auction at Phillips in London featured a slew of “process-based” paintings by artists trained and practicing overwhelmingly in America and England. These works are eye-catching, large-scale, and recognizable—namely, they have “wall power.” They aim to reclaim the practice of painting, reinterpreting abstract expressionism with experimental mediums and tools such as American artist Lucien Smith’s use of fire extinguisher or Welsh artist Dan Rees’ use of a household ceiling coating popular in the UK in the 1970s. These paintings can also be produced in mass, reminiscent of Andy Warhol’s (1928-1987) Pop art, a technique that is often part of the story itself. For example, American emerging artist Parker Ito (b. 1986) is striving to create a body of work that is as “limitless” as a Google search.

 

Following its Modern and Post-War rise to the top, New York remains the center of the global art world, with headlines about high-profile auctions, vibrant artist communities, premier museums, and top galleries drawing international attention. Meanwhile, the globalization of the art market allows talent that is emerging in more distant markets, such as Colombia’s Oscar Murillo (b. 1986), to show work on the New York stage. Other global centers, such as Los Angeles and London, also draw young, innovative artists.


SUMMARY


Sales had boomed in 2007 and rose by over 200% in value between 2005 to 2007, alongside a steady increase in the number of works sold at auction. This sector also became a target for new high net worth collectors and the focus of investment driven purchases due to relatively greater liquidity and more access than other sectors.

Other sectors this fund will invest in are, 

a. Post-War and Contemporary, which includes work from artists born after 1910. The artwork defines a time period, rather than a set of ideas and styles, and is most often used by auction houses to identify art created between 1945 and 1970. 

b. Modern, defined as artists born between 1875 and 1910.

The art market reached $64.5 billion in 2016, after achieving 7% y-o-y over the past decade. This growth is driven by the increase in overall transactions in the art market. On average, 9% of high net worth individual (HNWI) portfolios are diversified into alternative assets, which is a total addressable market of approximately $5 trillion. Art alone accounts for 17% of HNWI alternative investments, and when combined with other luxury collectibles, it accounts for up to 67%. In 2015, the global HNWI population was bigger than ever. Total wealth grew 7.2% to $56.4 trillion. This population experienced its 2nd largest year-on-year growth since 2000, 15%, with wealth reaching its second consecutive record high of 14% year-on-year.

 


PERFORMANCE


 

 


ADDITIONAL INFORMATION


Arthena builds funds from collections of individual works of art. To build a fund, Arthena targets acquisition of works that we predict to grow 20% year over year for the five year lifetime of the fund with an acceptable amount of risk. To make intelligent predictions, we use cutting-edge analytics on millions of historical auction results from major auction houses from around the world. At every step of the process we seek to provide our investors with high performing assets in the art world with risks uncorrelated from other markets.

Arthena acquires works in the emerging, post-war contemporary, and modern art market sectors, which together account for over 70% of the U.S. market and have shown the highest rate of growth over the past 10 years. In general, Arthena rates the emerging artist market as aggressive investment, the post-war contemporary market as moderate investment, and the modern market as store of wealth. Arthena’s funds diversify across these three market segments, with percentage of investment in each market sector weighted on investor risk tolerance. 


REPRESENTATIVE WORKS


Kolobok

Kolobok

Sanya Kantarovsky

Interior Landscape

Interior Landscape

Jonathan Gardner

STRIPPED

STRIPPED

Will Boone

The Studio (Broom and Mushroom)

The Studio (Broom and Mushroom)

Emily Mae Smith

Installation View

Installation View

Josh Citarella


TERMS OF FUND


Offering size*……….……….…………….….......$1,000,000

Management fee........……….……….……..……. 0.00%

Minimum investment ……….……….……………... 10,000

Investment Structure……….………..………..........Regulation D

Liquidity……….………..……….........................5 year investment horizon

Acquisition size.............................................Targets work below $50,000.00

 

Targeted IRR................................................12% -17.5%

Three-year investment period with two-year divestment and distribution period offers

medium-term liquidity