SPEAKER_00 0:03

Today's guest is Emilia Destacio, co-founder and COO of RSKP, an award-winning platform that's transforming how people buy, manage, profit finance, and invest in art. With a background spending at the European Central Bank, Moody's family office investing and alternative assets. Emilia brings a rare combination of institutional finance expertise and deep passion for art collecting. Through Artscaping, she is on a mission to make the art market more transparent, accessible, and data-driven, helping collectors think about art not just as culture, but as an investable asset class. Emilia, welcome to Scaling with Clarity.

SPEAKER_01 0:51

Thank you so much for having me. It's an honor to be invited.

SPEAKER_00 0:55

It's an absolute pleasure to have you. This is the continuation of the previous conversation that we started. What's the origin story behind Artscape? Like most art startups begin with a frustration. What was the moment when you and Alexandra looked at the artworks and said, this industry is broken, it needs to change?

SPEAKER_01 1:20

Yeah, so so I'm uh uh I mean, apart from my financial background, I'm a collector myself. So I've been collecting contemporary art for the past yeah, going on 15 years at this point. Um, and so and and and as my my co-founder uh separately, so we were both collecting art, um, met through the through the passion for for art, really. Um, and and in that journey experienced a lot of the frustrations that go into being a collector today. Um, and and we wanted to solve it. So we we had in mind, and I funnily enough, is actually the the work that's behind me here, um you can see there. Uh, we wanted to to acquire this particular work, it's a NARA. Um, and we we were we weren't able to find good objective information. We wanted just data and transparency, understanding, you know, where is the which is uh which is a good piece to to buy from this artist, which is the best forum to to buy it, where can I access good information? And we found it near impossible. So everywhere there is um there is an agenda, there are different hindrances and and things, loopholes for you to try to circumvent. And and so we decided, okay, look, we we want to we want to make a difference here. So it even started actually as a um almost as a hobby project, right? So we we created this little platform. So I came from uh from finance and I was thinking, okay, can we use concepts coming out of finance and and wealth management to try to distill and make art something that goes from being subjective and difficult to understand to something that is more objective and data-driven? Can we use that using maybe processes from finance? While my co-founder comes from a career in running digital businesses, so thinking about how we can translate these processes into something that is more streamlined and easier, easy to use. And so we set up this little platform. It was meant to be just for us and our collector friends, um, our little circle of of friends. And um one thing sort of led to to another. We researched the market, more and more people told us, okay, actually, you're on to something really, really interesting here. And and yeah, the rest is history. I mean, today we're we're a pretty big uh platform of 15,000 members globally. So I'm very happy to see how far we've come.

SPEAKER_00 3:58

That's amazing. Congratulations. What was the start year for you? Um when you officially decided you're you're no longer a hobby, but a real business.

SPEAKER_01 4:08

Yeah, so so we we we launched uh we launched uh we launched the beta very, very fast. Uh we were very fast to to create the initial uh the initial platform. It all started from um basically a collection management. So something where you you where you'd manage an art portfolio. Um and the more we started doing that, and the more we started testing, and and you know, with with zero marketing, we quickly grew to a couple of hundred members, uh, then getting on getting on 1000, 2000, and that's when we start to say, okay, this is this has a lot of legs, and we need to we should look at this. Um, and and that's where I mean, one thing that I've always been interested in as someone who's been a kind of quant markets analyst in my in my professional career, I started to look into the the market side of things, and so you know the the art market, although seemingly quite niche from the outside, is actually huge. And so we're talking over 60 billion transacted uh every year. And so we said, and yeah, and so we said, okay, let's let's actually focus on this. So um I quit my job first, and and he he left uh yeah, about six months later. And we we haven't looked back center.

SPEAKER_00 5:31

That's amazing. Um, can you tell me? Uh I mean, is it somebody that that's that that has lived in Quant and you say that the market is opaque?

SPEAKER_02 5:41

Yes.

SPEAKER_00 5:41

How do you go about building the data? Because I mean data could be a proprietary mode. Like, so how did you go about building the data to support RSKP?

SPEAKER_01 5:51

Yeah, so so so we we we look at data from a from a few different standpoints, and I think this is the really the richness of where AI comes in, right? So so the the key benefit of AI and what AI does better than a human is distilling and understanding large amounts of data in a very short span of time, um, and synthesizing different data sources. And so that's what we what we do today. So we pull together uh basically structured and unstructured data in the sense of um we we have data from all the major auction houses, even one over 1,000 auction houses that we pull in, which of course is a bit more structured. You have the the public public records of sales, but then we also look at uh aggregated anonymized data from from our members, so what's being collected, how is it being held, um, and then looking at other data sources from the market. We also do social listening, we have uh also augmented the model through image recognition, so all these things help to sort of fine-tune and bring in multiple data points, so not just looking at auction results as a as a guidance for where the market is, but also pulling in um and understanding gallery data and and and how the market really moves.

SPEAKER_00 7:17

Interesting. Uh what was the hardest part about this? Is it getting like the auction data? Is it building the platform? Is it getting the first customer kind of like what was the hardest part in in the journey?

SPEAKER_01 7:31

There I mean, there are many, many parts that are are not so easy in this, and I think you know, this is something that I've been seeing firsthand, um, also as an analyst myself. So even if there is data, the the problem is often the the the kind of the the cleanliness, if you will. So cleaning up the data, so having having errors and typos, and and the problem with that is is a machine will read a typo as a new data entry. Uh, while you'd need as a as a human, you know, if I'm seeing okay, Banksy or Bacan C is gonna be the same thing, of course, right? Uh but you'd need to you'd need to go in and manually adjust those. And you know, that happens a lot. Uh and you know, things being um reported in different ways and slotting into different fields of information. So there's been a lot of work to understand and sort of standardize these sources, um, and and I'd say distilling then the the sort of more unstructured thing. So which are the good data sources beyond auction houses that we can look at? How do we um how do we distill those into credible signals?

SPEAKER_00 8:51

Emilia. Um I'm I'm I'm curious if someone has never considered art as an investment, why should they consider it until um, and this maybe it's a it's a leading question, but um there's uh a very famous professor that teaches at New York University, and and recently uh when all of the terrorists were happening in the States, he came up and said, well, people should be spending more of the putting more of the investments into collectibles or art. Um because there's no safe harbor left. Uh kind of like, have you seen an increase that's disproportion of just normal growth for you guys in terms of more people coming into the art market?

SPEAKER_01 9:43

Uh definitely. I would I would say definitely yes. Um I I think that there's quite a few trends that sort of feed into this. So I think one of them is is this idea of art as a as a sort of safe haven, um or you know, another alternative asset. Um there's also a lot of, especially in the younger generations, of um of people coming into coming into greater greater incomes and greater wealth. Uh you have also the great wealth transfer, so all these macro trends feeding in. And so then the question comes, okay, what's the best way to to manage these funds? What's the best way for me to allocate it, right? And and then art comes in as a as a nice component in that portfolio. Now, I should say most people, and and indeed I dare I say near near all of our members and what I'm seeing from collectors specifically, they're not necessarily doing it purely for a financial gain. Typically, people fall across a spectrum between passion and finance, and it's very rare that they will be only one or the other, so i.e., only buying for passion or only buying for financial gain. Typically, people sit across the spectrum, yeah. And and most of the time it's okay, I'm allocating funds into this asset, and they you know would like to not lose money. So it's more that is the question. But the way to do that then is by having data and transparency and understanding that asset class. Then still from uh from a market research standpoint, you do see that art tends to perform by and large decently well. Uh, again, depends on how the how you cut and slice the sample, right? It's very easy for me to pick out superstar stories of something that was bought two years ago that now sold for 50-60 percent more, triple the amount, right? But I can also handpick examples of of something similar to the opposite. Um, so I would always caution uh to look at um this as a as a it's it's not a homogenous asset class, right? It's not you can buy any work uh and and expect to do well, but I would say that goes into any any investment, right? It's like saying, okay, if you buy any stock, it's gonna go up in value. No, you have to know what you're buying, and not not all the stocks are going to do well, and not all of them are going to go up. It's the exact same principle um that goes into art. Um, but then what's what's interesting on the flip side, I would say, is is this idea of the uncorrelated nature. So by and large, I wouldn't say I would never say that art is immune, right? So still, when times are bad, people do get cautious with their spending in general, overall. That's of course the case, but it's going to move less in tandem with with other assets, um, which which makes it interesting from kind of um finance 101 sort of portfolio construction standpoint. Um, and so that's that's also why people are drawn to it. But then finally, I would also say there's also the the sort of non-financial element that people really, really like. Yeah, it's it's one, it's your personal enjoyment. So so now I I personally cannot imagine life without art. So I I I take benefit from it every day, it inspires me on a daily basis. But I also like the idea of being able to support cultural production. So by me buying art, especially from in Wayne, particularly from living artists, it means that I'm actively supporting their their work, right? So and helping to either shape how we think as a as a society or pushing certain questions and making them uh something that is more aware uh in society. So and we do see that as a general trend. So this almost almost a sort of social investing or impact investing with the vehicle for that being being art. Um and so there's there's all these streams across the financial bits and the non-financial bits that draw more and more people into into the world of art. And and so that's where we're really hoping to also be that that tool to enable people to do that.

SPEAKER_00 14:26

Amazing. Um is there a particular strategy that works better than artists? Like, for example, like you mentioned living artists. Should most people attempt to buy their first art or they buy their art directly from artists or galleries rather than acquiring their pieces via auctions? Because then the auction house is the one that well, auction house in the previous one, is the one that recognizes the gains.

SPEAKER_01 14:54

Yeah, yeah. So I think a couple of points here, right? So I think as with as with uh almost any any investment, diversity is the is the name of the game. Um you don't want to put all your eggs in one basket. Uh, you know, is it's really the same portfolio thinking that applies into into a diversified um art collection from that standpoint. You probably want to anchor with a in as much as possible, anchor with a few kind of more blue chip works, which will be kind of your more famous names. Then you can have more emerging artists that maybe speak to more personal topics, or there are more kind of the rising stars of the art market. So that's that's really if you if you're looking at it from a portfolio construction, but of course, there are also people that um will collect thematically. Um so so again, I mean, personally, my our collection has evolved from I mean, we we rarely buy, let's say, pure blue chip works anymore. We we buy a lot of uh emerging earlier stage um artists, uh, and and we and we buy thematically, so uh so we collect across different different themes. Um and and that that's the reason sort of for for collecting. And then of course there is a there is an element of financial understanding, okay, where are we putting the money? But it's not necessarily okay, thinking, okay, we should we should buy this because that anchors the portfolio and then it's gonna rise in value so and so much. Um but yeah, if you if you want to think along those terms, then then still that kind of portfolio thinking uh does does apply. Um, but I think the overall, the overall sort of message is is the research, right? Is it goes into again we're back to investment sort of one 101. Yeah, like whatever, wherever you put your money, you need to you need to research and understand where you're putting it. Now, then there are a few few ways to to acquire that knowledge, right? Either you acquire it yourself, um, so you you study and you understand the art market, you start to get into it, uh, you need to understand the data, look at the data, or you start to work with um a provider or a servicer or you know, an art advisor as such. Um, or you know, a platform like Artscape, which gives you these kinds of insights. We have also obviously our our human advisors that help to shape the the the collection. So even if you're starting from zero, plenty of our members, you know, join Artscape because they're trying to start to build a collection, but you know, they don't know, they they maybe don't know you know where to where where to start, what's uh what's a good place to to start, and so we we help from from that stage. So I I would say that that needs to always be the um the guiding thinking behind.

SPEAKER_00 18:02

I want to double-click on thematic buying, kind of like like like what do you mean by this? I mean, obviously, team is the is is the word the uh at the root of the word, but what do you mean by thematic buying?

SPEAKER_01 18:17

Yeah, so so I mean, drawing drawing on my my personal experience, so uh essentially we uh in our collection we we collect across uh three themes. I mean, one of the the things that we want to do with the art collection, so we we now have I think about 200 to 50 250 works or so in the cursor, so it's quite big. Um, and and the thinking there was we want to collect uh only living artists, so we want to collect and be custodians of part of the story that we lived through. Um, so you know, as much as I admire uh Basquiat or World, I didn't personally live those those days and years in in New York in the in the 70s, 80s. So I wasn't there. So as much as I admire it, I don't feel like I would I want to capture that part of our history because it's not part of my history. Um, and so we we collect living artists from our time, uh, and then we look at three strands, which basically social-political topics, um, kind of we we think about it as sort of an environmental field, so how nature and humanity clash and and sort of the destruction of nature by humankind and those topics tackled in art, um, and then sort of identity formation. So, what goes into making uh Emilia, Emilia, and Maxim Maxim across the board, so not just um not just maybe maybe gender, but also what we consider as home, what I do I consider as my nationality. So these kind of deep profound topics uh expressed in art. So when we look at a work, there's a lot of thinking and research that goes into it. So one does it does it fit into these into these themes? Uh does it speak to us uh in in those areas? Do we do we can we get to know the artist? Can we meet the artist? Um can we understand more of their of their background, their practice? Um how does this work sit in in their in their in what they're doing and within the the wider span of um art history in some sense? So also they if you think about artists as the the prime sort of social scientists um of the world, they they are really incredible in the way of capturing not just the present time, but almost predicting what the the current issues are that persist over time, right? And and that's what I find really, really exciting about art as an asset. So that's that's kind of how how we look at the collection. But there are also definitely people that uh, as I said, have an even stronger, maybe sort of impact agenda. Maybe they only buy works from female artists, or maybe only, let's say, uh LGBTQ artists, or maybe only from the African uh diaspora, um, or only this and this uh specific theme, or maybe only um yeah, tackling these and these issues. So that's that's how people can look at it. So there can be different, I would say, criteria lenses, but it's the same, I would say, that you can still approach it uh thematically, even stocks, right? Because you can say, okay, I only want to invest in tech, I like AI, I'm only gonna buy AI companies, chipmilli. And then I want to buy a bit of EV vehicle producers. And then that's the themes of your stock portfolio. So really it's although maybe what I just said now feels very okay, art specific, is actually if you if you experience it. It's applicable across any any asset class. Also, there, if you're thinking, even if you're thinking, let's say a wine investment, right, you may specialize and say, okay, I'm only going to buy burgundy uh producers, or you know, I really only like uh champagne, so I'm gonna buy producers of that. Um really is all is all the same, is all the same thinking. And I think some of these themes are things that come up uh over time. So maybe you start looking at art from sort of this idea of okay, let me build a diversified portfolio. I'll buy maybe something uh sort of blue chip and a few things more emerging and and a few sort of mid-career artists have something balanced. And then as you start to look at it and live with it, you start to see, okay, actually, I'm very much drawn into this, and then you can start to start to shape the shape the collection. And I think that's the that's the beauty and joy of of buying art, right? It's not just buying, it's it's the it's the intellectual stimulus, it's it's the deep thinking, it's it's what it gives you on a daily basis, right? Which goes above and beyond any other any other investment.

SPEAKER_00 23:34

Yeah, I completely agree. I mean, I I have a passion for wine. I own a number of companies in wine, and it's it's amazing to see uh there's a lot of similarities between wine and art, and and particular, um it it like we've we've done a ton of events at art galleries because they just kind of appeal to the same kind of the same customer. Um but if we're speaking if we're speaking about the customer, in from your perspective, what separates somebody that's really good at buying art versus somebody that just I just buy expensive art?

SPEAKER_01 24:11

Um well, I I think I I think the point there is once something is already expensive, it doesn't matter how we define expensive, but what whatever that number is, when art has hit that point, there's less upside, right? So so you know buying an indie world today, yes, it's uh it's a is a is a stable, it can be it can be a stable investment. Not every piece, again, I'm I'm generalizing very much now, and and again, this isn't sort of investment advice in in any shape or form, um, but uh there's not you know uh a world is probably not going to triple in value, right? While someone who an artist that you know maybe recently graduated, a decent art school has had some good shows, is being picked up by institutions, showing at museums, um, progressing through sort of gallery ranks, uh, maybe enters into other prominent collections. But if you manage to spot those those kind of artists, uh then there can be a chance that they increase quite a bit in in value, right? So still I'm I'm not sure that that necessarily makes you the best sort of uh collector or investor, but uh maybe from a financial standpoint you probably have a you could possibly have a stronger, stronger upside, right? But again, there's the there's always the risk return trade-off, right? So buying buying an artist that is earlier career, there's a higher risk from that standpoint, but it can be there can also be a higher higher return in that sense. Um and and still so art is a is a is a long hold asset, right? So it it can perform decently if you hold it for a long time, right? And long means you know, seven, ten, even more years than than that, um, ideally. Um and and that's where you can see where you can see some some decent returns, basically.

SPEAKER_00 26:31

I mean, I uh like feature ventures uh is in the business in the business of scaling up companies. We are launching our first fund. And so that I can't help but find the similarities there, because essentially if you're in a fund, you're you're we're scouting for companies and you're trying to find the right company, the needle in the haste side to invest in. You guys do something similar on the art side where you're scouting for the right artist because obviously, in your mindset, you are currently describing it's exactly like you're tracking artists through their journey, and you're investing in the ones that they're on an awkward trajectory. But like what is the art sky approach in terms of scouting for artists?

SPEAKER_01 27:14

Yeah, yeah. And I I I I really like this that you that you brought this up because the that analogy is very is very clear, and and what makes art quite difficult from that sense. So if you if we compare it to watches, for example, by and large, we can probably name the ones that are the sort of investment grade sort of makers, right? And then within that, obviously you have to find the right model, it's about rarity, etc. But it's I don't want to say standardized, but we all know, okay, kind of Rolex, uh, particularly whatever they're gonna do decent, right? But art, that list is quite big. And again, even within that list. So if I come back to the to the idea of world, right, which is the uh tends to year over year be the most liquid artist, is not every every work that's going to uh perform well or sell well, it's also how do you sell it, how do you buy it, at what point do you buy it, um whether comes in the the sales channel as well. Uh, but going back to sort of what you were saying in terms of finding companies, it's there is a lot of that same thinking, right? Because once you once you go out from the the really the top layer of of the blue chip works, or still even within blue chip works, is finding that gem which is the which is a good which is a good deal, right? So there's also a lot of I mean there's a certain art to collecting in in in that sense, right? Because there are so many great, great, great artists, but you have to at some point think, is this something that I like and believe in? Do I like this artist's practice? And and I think that's where really the long-term thinking has to come into play, right? You have to be ready to live with this work for 10 years or have it be the owner and custodian of it. So never buy any art that you you don't like yourself, right? So it is and everything, as with any investment, it's very easy to be to enter into the fallacy of the um of hindsight bias, right? So it's very easy to say, okay, I could have, would have, should have bought this artwork or that stock or that uh that uh that whiskey barrel or whatever, uh, because now I see it did really well, but it's not so easy. And so so we we definitely do a lot, a lot of this scouting, um for personally for our collection, but also on behalf of our on behalf of our members, and that's where the data comes in, and that's where looking not just at one variable makes sense. So in our the way we look at data, although we do provide through a we provide sort of an AI estimate of the market value, that's not the end of the story, right? The data point of okay, our estimate that this artwork is valued so and so much on the open market today, in isolation, actually doesn't tell you all that much. What you really need is the is the context, right? So, what's the depth of the the market, liquidity, what's the momentum? Okay, the data point that the price is X today, but is that X likely to go up or down? If it's likely to go up, maybe I should uh I should buy it now. If it's likely to go down, you know, it's the is another story. Um and so that's why that's why we approach it sort of so holistically, right? So if we have several like areas that we look at, we look also at geographic arbitrage, because maybe there is there's an opportunity, okay. You've you've decided that, okay, I'm going to, I would like to buy this artist. Okay, but where are you going to buy it? How are you going to buy it? Which is the piece you have to have in mind also the transportation, because again, you're dealing with a physical good, right? So that piece either needs to move uh to you or into a free port, into a storage. Um, so there's all these complexities, which is again why we built Artscape to begin with, to take care of each of these steps, to really just leave you with sort of the the joy part of collecting, so buying stuff that you like and having the guidance to buy things that you you like, and for us to sort out the um the remaining steps. Um but yeah, so finding those kind of gems is where where the data comes in. And and I'm I'm sure, you know, without having gone on the hood of uh under the hood of you guys' models, they must be quite quite in intense in some sense, quite quite comprehensive, right? And and that's why you you say no 99 plus times out of 100, because it needs to it needs to it needs to fit the bell. And and you know, it's always the case when you're you're the the investor or the buyer, there are always too many opportunities that are interesting compared to what you can actually say yes to. Um and and and the same goes the same goes with art, and that's why you need the transparency and the data to to make those decisions.

SPEAKER_00 32:45

Yeah, I completely agree. Um say no is probably the hardest thing that people have to learn. Uh, because it's it's it's easy to say yes, it's comfortable saying yes. You make the other person copy, but saying no is hard. Um, yeah, I agree.

SPEAKER_01 33:02

Yeah, and especially, I mean, with art, then especially if you have the the the pleasure to also meet uh meet the artist. I mean, yes, I went to we went to an opening of uh of an artist we recently bought a work from, and you know, you're showing showing new works, and you're there, you want to buy everything. And and and he's he's right there, you know. We we we spoke to the artist, and it's it's giving you that added joy because you on you get to understand the the process, the thinking behind the deeper meanings. Uh, because also there the beauty of art is is also that we take different things from it, right? So maybe maybe for you this painting is is aggressive, but for me it's calm. Maybe for you it reminds you of a beach day, but for me it reminds me of the night, or what have you. And it's that's also the that's also the beauty of it. Um the the the sentiment and the thinking that you you take from it. But the and it's hard to say say say no. Um but you want to keep supporting that, but that's where I think the again the same as with any any investment, you have to keep uh sort of a cool head in some sense and follow follow your process, because otherwise it's that's where you start to uh maybe make mistakes in the sense of maybe you you buy things that you in in hindsight didn't really want to get, or then you know maybe maybe you regret buying or something later on.

SPEAKER_00 34:28

But if people follow your advice in terms of buy for enjoyment, passion, emotion, and and then economics, even if the economic value doesn't pan out, you still have the piece of art to enjoy. Yeah, maybe you don't appreciate, or maybe yeah.

SPEAKER_01 34:48

Yeah, yeah, yeah. And that's what I'm saying. So so so the that's why I say so, regardless of how or why you're buying, it should always be something that you are comfortable with with keeping and having for the next uh yeah, five, ten years, or however long it might take to sell it, should you should you need to. But again, that's also why we, for example, we we started to to lend ourselves. So Rscape is is also uh also does securitization, right? So that would be a way for you to access liquidity, just the same that the people are leveraging their stock portfolios, uh drawing out equity from their houses, properties, etc., as a way to to unlock liquidity to to meet whatever their their their needs are, right? So without needing to sell. So maybe you you have you know a sizable portion of of your income or wealth tied into art, but now you have also a way to um access funds from them without needing to sell or without waiting for them to sell or selling in a bad moment.

SPEAKER_00 35:58

Um curiosity question. Out of the 15,000 members, how many of them are institutions versus uh private collectors? Is it primarily uh are the institutions coming in coming in onto RSKP?

SPEAKER_01 36:12

Yeah, we we have so we we started the the the focus of the platform has been the the the the individual collectors and and by and large that's that's that's a lot of them, but we also have sort of family offices, kind of institutional collectors, um yeah, kind of trusts and charities as well. And within so there is a kind of a solid B2B angle to to what we do as well. Um and and in particular, a lot of family offices will have will have an allocation into art in in some sense because they want to have it in in their properties or or for diversification reasons. So definitely those are those are our members as well. I mean, we we also have um advisors uh that help to to manage collections for for their clients, and they're using Artscape as a tool to do so. So definitely it's sort of across the board, but yeah, the lion's share are going to be uh private collectors as such.

SPEAKER_00 37:19

Understood. Um, I mean you guys introduced uh a novel financial product in terms of securitization of the art. Um, do you envision the art market moving um in a direction where it's it's a lot more ubiquitous, a lot more people using it, it's a lot more liquid. Um kind of like what does the future of art look like in your eyes?

SPEAKER_01 37:44

I think so I I think I think art will be be seen uh the the same as as any other any other asset. So I think definitely, I mean, if you look at how people invest today, we I mean, long gone are the days where you have uh kind of 60% equity and 40% fixed income, like that's that doesn't exist anymore, or you know, like 50, 30, and then some into alternatives. Like that's that kind of portfolio setup is is less and less um part of the part of the story. People are are are flopping into alternatives now, call it crypto, call it uh collectibles, call it art. Uh I really see that as as the future, and that's something that you know people are are really looking at. So across millennials, Gen Z, they're looking for alternative ways. I saw a really interesting survey, a couple of, I mean, at this point it will be decently old, but um it will still be within the last year. There was a survey by Bank of America looking at how uh Americans are uh are investing, and they looked at you know, millennials and then said some 75% were skeptical that you could make what was called sort of meaningful returns with just traditional assets. So if you have three out of four people who don't think you can make sort of any reasonable returns through through stocks, they're going to be looking elsewhere. And indeed, the the portfolio allocations across those kind of um demographics and segments were very heavily tilted or are heavily tilted into alternatives. And and that yeah, it's going to be across property, real estate, uh, crypto, art collectibles, wines, etc., classic cars. So I really see us moving into this more fluid allocations, also the the value of art of these financial and non-financial uh benefits and and and you know how art really informs us um in in the daily thinking. So definitely moving in this direction. And I think you know, we're we're not the only we're not the only company on the market that's supporting the the wave of transparency. So so the kind of the consumer or the the uh the person of today wants access, transparency, uh, interconnectedness, and and streamline services. And that's where art is moving. Art is becoming easier and easier, I think, in in in large part because of the things we are pushing, um, but also others making it much easier to to access the art world. So it's coming, it's really coming out of the coming out of the shadows, which is uh which is a beautiful thing, in my opinion.

SPEAKER_00 40:44

Emilia, do you see rationalization playing a role in more people-owning art?

SPEAKER_01 40:54

Yeah, so so I I go I go very much personally back and forth uh on this. So I personally uh I don't I personally I don't like the concept of fractionalization. Why? Because you you you've stripped out the last element of of passion from art. So in fractionalization, no one enjoys the art, no one sees the art. So collecting itself is obviously a fairly selfish thing. Only I will see this work on a daily basis, and maybe my my dinner guests, but that's that's about it, right? So for for many years, that's that those are the only people that are going to be influenced positively by this work. So I grant that it's a fairly selfish activity to be doing, but at least that there is someone enjoying and taking also the non-financial joy and beauty of art, which is what the artist wants, right? They're not producing art for someone else to make money. Their whole point is okay, can I transmit an interesting thought, a message, um idea to someone? And the the problem with fractionalization is that that element is completely stripped out. Those works sit in storage uh until until they are sold again. So by buying uh buying art in a fractionalized manner, you you're purely in the financial side and only on the financial side. There's zero passion. Um yes, you can take uh, but I've also increasingly, and I'm starting to buy into this argument as well that people say, yeah, but it's a it can be a good entry point, right? Because people start to get curious, they still start to see the artworks, they start to feel ownership of the artwork, they start to say, Okay, yeah, but I own a piece of a um of a Picasso or of a war all. I've always wanted to have a Picasso and now I now I have part of one. And and that can be a beautiful thing, and maybe that becomes a stepping stone into buying more art and you know, really getting into the art market in that sense. And and if so, then then yes, it can be it can be a really, really nice thing. Um, but because fractionalization itself is you're really just looking at the financial upside at the end of the day. Um that's that that's the thing that I don't like personally. Uh, but still, you know, we we work with fractional uh platform partners, and and and you know, and I think judging by the the amount of of audience audiences that are growing into these into these platforms, that definitely does seem like that latter um perspective, i.e. of fractionalization becoming this sort of stepping stone seems to be what's playing out, right? So that's that that's an interesting um that's an interesting uh angle to it. Um so so yeah, why not?

SPEAKER_00 43:54

Yeah, I mean, my my perspective is like um both you and I come from a race background, and so If I'm buying a fraction of a warhol painting, it's a steady asset, right? It's not going to depreciate in value. It's only going to appreciate, not to the same degree as a as a new artist, a merchant artist. But I get I get a piece, I get to diversify from maybe holding securities and stocks. So that's kind of the perspective. But in in adjacency to this, what like I can't remember now, but it's probably it was a few years ago, five, six, seven years ago, the NFT grace and kind of like what's your perspective around it? Because then that was kind of like almost the reverse. Like everybody gets to enjoy the asset, but one person is the owner of it.

SPEAKER_01 44:46

Yeah, so I think that was very much driven by by hype and and and speculation, right? So if you if you looked at who were the market makers of those days, who were people with strong agendas, so so that very famous Beeple sale was made to like a crypto fund, or he was like a big uh crypto investor, the guy who who bought it. So it's not yes, okay, it sold for some, I think it was nearly 70 million, which is which is astronomical. But you know, I wouldn't say necessarily that that person bought it because that work has a solid uh addition to the art of art history, right? And and and and and and I think that's also why sort of the the bubble in some sense burst because so an NFT at the at the end of the day was is is just a medium, right? It's like saying, okay, we've invented this new linen, cotton, mix, uh canvas, okay, but what matters is what's on it, right? So here's here's an NFT, but what matters is what's on the NFT. Is it yes, we can have a we can have a photograph or a digital work or for video work, these things can be great because you can establish authenticity, provenance, the the true creator uh gets benefit from it. But it's not that being an NFT on its own is going to carry value. And I think that's what we what we saw in that bubble. So there was a there was there was a lot of market making in the sense of driving speculation that went into this, uh, which which casts various uh impressions on the on the world of what makes art or not. And I think the the the the history always reveals itself. So uh quality is what's what wins at the end of the day.

SPEAKER_00 46:56

Speaking of quality, um I'm curious, what is your perspective on AI and how AI is impacting the art industry? I mean, like I I can tell you from my personal perspective, I am a better writer, I am a better storyteller because of AI. It's not a substitute in any way, like I only use this enabled. Kind of like from your vantage point, what what is and what has been the impact of AI on art?

SPEAKER_01 47:29

Yeah, so so I I think it's important to split out the the applications, right? Because a lot of people will, when you say AI and art in a sentence, people will say AI, think of AI producing art. I think that application and the success of that application is very limited. Now, of course, and we're gonna play this clip to me in 10 years, and I'm gonna be totally wrong, but I think because art is fundamentally human, great art is fundamentally human, by definition, it's something that cannot be cannot not cannot be done, right? So I think AI in that sense can produce something that could be popular. So probably we see that in in AI producing music and and writing uh writing stories and writing plays, right? They can create something that is pleasing, sure. And and maybe maybe AI art in that sense are going to make these compositions and creations that are pleasing to look at, but are they going to have that that depth and that conceptualism that great art has that that goes beyond that? I think great art, it great art sits outside the box, right? So things that are decorative or pleasing tend to not have strong, strong value, right? So you don't really see in Christie's and Sotheby's these incredible landscape pieces, right? Because there isn't that commentary element or that added perspective. And so, and I think that will always fundamentally be missing from AI-generated art. I think where AI can help in the still within the realm of producing art, it can help in the in the research, right? So, as I said, um, artists are really, if you think about it, they're the they're the prime social scientists of the world, right? And a lot of them do very deep research that goes into the work. And AI could probably help in that element, but then which which could be a very good application because then it leaves more space for the artist then to take in that information and conceptualize it into a work, and and leaving sort of the creation bit with them and less into the okay, let me understand the references, what's been said about this, what is what is an angle I can take on this as an artist on this topic. So that's where it could help, right? But I don't think like AI-produced art is going to ever rise so high into prominence or importance. Uh then I think on the flip side of if you think AI applied to art or the art market as such, then I think I think one of the things that we what we are doing is is sort of a prime example of that, right? Because we go back to the idea of what does AI do better than a human, synthesize and understand vast amounts of data faster than a human can. That's exactly what we're doing. So our market intelligence looks at more than five million data points. We can up, we update it, it's dynamic, right? So in theory, we could we could be releasing uh new art valuations on a daily basis, but doesn't really make sense because art doesn't move at that frequency.

SPEAKER_02 51:03

Yeah.

SPEAKER_01 51:04

We can do that, but and we can only do that because of AI. Like I it would be physically impossible to replicate the that kind of progress and that kind of accuracy with humans. And that's that that's that for me is is is is an objective uh statement, right? So I and that's the that's the richness of of AI. And I think that's where you can what's where you can apply it. So AI in terms of data understanding, but also like flow um optimizations, right? So if I'm a if I'm a gallery understanding okay, how to best serve my my database or you know, process improvement really um is also a great application uh of AI. But I and that's where I see really the value add of AI into art and into into sort of any any industry is the process improvement. And and I like you, I I mean, I use I mean, I think I spend 90% of my day using AI in in some shape or form, either through Artscape itself, because we have it natively in the platform, or just to assist me in my in my in my daily daily life.

SPEAKER_00 52:21

Yeah, I agree. Um what uh kind of like I know we're coming in time, but what advice would you give other founders that that are trying to modernize industry? Because there's there's plenty of industries that they're still kind of like 50, 60, 70 years old in the way that they're doing business.

SPEAKER_01 52:41

Yeah, so I think I mean it's a it's a tricky one because when you're trying to to make improve something and and shift how something is done, there's going to be resistance, right? That's that's uh so but the but that's a part of human psychology where we're we're resistant to change, right? But to yes, um I I I think the the root there is understand at depth what is the problem you are solving rather than rather than the rather than the behavior, right? Rather than saying, okay, uh the process is this, this, this, and this. People perform this transaction or project in these and these steps. Okay, let me let me shift how they're trying to do that. No, attack what the problem is, right? So why are they doing this? What's the what's the end goal of it? And if I can solve that, then I will be able to deliver value. And so rather than rather process improvement, think of solution sort of enablement or deliver.

SPEAKER_00 53:49

How do you guys go about discovering what the problem is in the art market? I mean, you said that you were passionate about art. Do you guys have to pivot along the way? Um, or you intuitively knew through uh through kind of personal life where the problem lies and attacked it right away.

SPEAKER_01 54:07

I mean, we we so we speak to we speak to our collectors on a daily basis. Uh we we get huge inputs from the team. I'm I'm very proud and happy of the the team that we've we've built, and you know, and and it's about accepting innovation and ideas from from anyone in the team. So it doesn't matter if you're the most junior or the most senior, if you have an idea of how to make something better, I want to hear it, right? Listen, and I want to see it, or if you you you're getting this feedback directly from from from the collectors, then yeah, that's something that we we want to look at uh and and see if we can we can support.

SPEAKER_00 54:47

Last question for you, Emilia. Um, what's the kindest thing anyone has done for you?

SPEAKER_01 54:55

Oh uh kindness. So I I think I mean the the greatest joy, I think, for me as a as a founder is is is seeing seeing the the value, right? So that we we are able to to give is is hearing people that you know that maybe I don't know at all, but they they've they've seen Rscape and they and they come and tell me, okay, wow, I can't believe that this didn't exist before. This has helped me so much, or you know, I I can really see how you are championing kind of transparency or or really bringing in credibility into the market. And you know, even without me saying those things, you're basically repeating our core values to me. And that's like, okay, well, we're one, we're having an impact, and two, we're we're we're able to, we're doing the right thing. So we're going for for quality over quantity, we're going after value creation rather than a short gain. Um, and seeing that sort of hard work actually plan pan into something is is makes me makes me uh cry of happiness. So I'm yeah, I'm super super glad to to see that. And just just now, I mean, and and seeing that sort of permit everywhere. So we we just released we're we're we're we're we're in a hiring round now, and I just released a couple of of roles, and we've had you know 350 applicants that want to join our company. Is it for me is incredible. Like I remember when there were barely 300 people that knew of our company's existence. And now we have so many applicants that want to join us and and help make a better art market and enable more people into the arts. That's that's a beautiful thing, and that makes me incredibly happy and humbled as a as a founder.

SPEAKER_00 56:58

Amazing. Congratulations on all your success, and thank you so much for being such a graceful um guest. Um, I really enjoy the conversation.

SPEAKER_01 57:08

No, thank you so much. I feel so so so honored and thankful that you invited me, and I really hope that this has been useful.

SPEAKER_00 57:16

Absolutely, and I hope it's useful to our listeners and viewers, and and the ones that are maybe considering delving into art to give RSCP a try.

SPEAKER_01 57:27

Absolutely, 100%.

SPEAKER_00 57:29

Thanks, Amelia.

SPEAKER_01 57:30

Thank you so much.