Yesterday’s Washington Post had a front-page story about how sculptor Sharon Louden dealt with raising the $20,000 she needed to begin fulfilling the biggest commission of her life.
Her assignment: fill 6,000 square feet of space at the Kemper Museum of Contemporary Art in Kansas City, Missouri.
At first, she resigned herself to borrowing the money on her credit cards and going deeply into debt.
Then she had a better idea: sell shares in the sculpture (above), which would be put up for sale after its exhibition.
She called previous buyers of her work, and easily raised the money.
This past spring she sold it to a corporate buyer, earning investors returns of between 50% and 75% on their money.
Investments had ranged between $200 and several thousand dollars, and the minimum return for any investor was $100.
Louden said when she began telling investors about the size of their returns from the sculpture, many begged her to keep the money for her next venture.
“They just freaked out,” she said.
She said she has been inundated with phone calls from investors eager to get in on her next project and artists interested in her novel fundraising procedure.
She is getting ready to solicit a second round of investors for an ambitious animation project.
James McLaren, an investment banker who put money into Louden’s sculpture, said he was attracted by the structure of the deal: if the piece had failed to sell, each investor would have received a piece of the sculpture, which could easily be broken into pieces.
But he said the real reason he put up money was the thrill of helping an artist.
While Louden’s approach appears fairly novel, the idea of securitizing art is not new. One of the most famous examples is the “Bowie Bond.”
In 1997, pop star David Bowie considered selling his extensive catalog of previous albums.
Instead, he decided to sell bonds backed by future revenue from his songs.
The bond sale raised $55 million for Bowie and allowed him to retain control of his work.
Bowie bonds carry a 7.9% interest rate and have never missed a payment.
Since 1997 bonds backed by royalties from songs in the catalogs of Motown Records, James Brown, Ashford & Simpson, and the Isley Brothers have been sold successfully.
New York financier Robert D’Loren is preparing to sell bonds that will pay dividends based on royalties on everything from song lyrics to hamburger recipes.
I wonder when I’ll be hearing from D’Loren to discuss securitizing my archives.
They must be worth a fortune.
I guess if the phone don’t ring, I’ll know it’s him.Powered by Sidelines