Many questioned whether there was a place for fine art sales on the web as technology transformed retail over the past decade. Would consumers invest tens of thousands of dollars without seeing pieces in person?
Paddle8 came along in 2011 despite the uncertainty, founded by Phillips auctioneer and former LVMH executive Alexander Gilkes and biotech entrepreneur Aditya Julka. The founders realized there was a huge opportunity for the art world to adapt to the digital age, and the risk paid off.
Paddle8 runs curated online sales of works under $100,000, a price point that traditional houses aren’t interested in because the costs associated with selling a work at auction are too high to justify the smaller price tag. The company also partners with charities to run benefit auctions, replacing bids on paper with bids online, vastly increasing the bidding audience.
Paddle8 has generated $100 million in bidding activity and raised $25 million for charity, showing that consumers would indeed pay for art even if it were sold online. Just last week, a Jeff Koons piece set the record for Paddle8’s biggest sale ever at $900,000.
Tech Page One recently asked Julka to share some insight into the technological workings behind Paddle8’s success.
Paddle8′s engineers have a passion for art as well as tech. Can you talk about how the intersection of art and technology comes through in your product?
This is at the core of Paddle8. We have many developers that are significant collectors, artists and musicians. Having developers who value artistic processes means that they will write code and create interfaces that make users’ interactions with art the best that it can be. If people care about art, they will work to bring it to the public in the best possible way.
What have been the biggest challenges in developing software to support the mission of Paddle8?
The art and auction worlds have a long and sometimes arcane history that simply does not translate into standard e-commerce models. Every aspect has to be handled differently — from credit card and user validation to managing high-value fulfillments. Our developers have had to construct a code base that allows for flexibility and a wide variety of unique conditions for our auctions.
Do you think customers are becoming more willing to buy art online without seeing pieces in person?
It may seem counter intuitive, but art is actually a much easier category to sell online than many people imagine. Many collectors today are already comfortable buying art by referencing JPEGs sent to them by dealers, or images in an auction catalog.
We’ve found that collectors looking to add a specific artist or work to a collection are channel-agnostic (they buy across all platforms) as long as they trust the platform and believe that the pricing is accurate. Paddle8 started as an auction platform for the world’s best museums and art foundations, so we have a high degree of credibility in the market. We also have a specialist team from the world’s best auction houses and galleries to authenticate and price our works.
Have you found that consumers’ interaction with technology psychologically affects bidding behavior?
We never expected older collectors to be early adopters, but it’s been fascinating to see them use our tablets and app. (Paddle8 issues tablets to buyers who attend auctions in person). They comment on how addictive it is and also the convenience. They can continue to bid without the hassle of rushing to every physical auction.
There is huge passion associated with bidding and winning an auction online. The platform enables people across the world to bid on auctions they may never have seen otherwise.
How will Paddle8’s technology grow in the future?
We are currently working on discovery mechanisms to help people find objects they might be interested in and creating editorial content to contextualize each work. You will also see us launching features to further integrate our technology into physical auctions, enabling our collectors to participate seamlessly across any platform at any event.Tags: Entrepreneurship,Industries,Retail