Estonian art startup Kanvas.ai opened an Estonian art index on its website, which shows that the volume of Estonian auction galleries has grown significantly in recent years, reaching almost 4.5 million euros. Investing in art as an asset class has been affected by the crises, which prompt money to be invested in alternative asset classes.
According to Kanvas.ai art index co-author and Kanvas.ai co-founder Julian Kaljuvee, the volume of Estonian auction galleries has been constantly increasing over the past few decades, with the biggest increase occurring precisely during the recent social crises. "If in 2001, the turnover of Estonian public auction galleries was only around 174,000 euros, then in 2021 it reached as much as 4.5 million euros. Art sales have skyrocketed since 2019 and have been affected by social crises. As an example, the Estonian auction market sales increased considerably when the military conflict broke out in the Ukraine as investors began looking for safe heaven assets while the stock markets were falling globally. The same thing happened at the beginning of the corona crisis and during the previous recession, when the volume of auctions was very high as evidenced by the index," said Kaljuvee.
The Estonian art index has been created based on information from the public auctions of Estonia's largest art galleries - HAUS gallery, Vaal gallery, Allee gallery, E-art salon and Verinssage gallery - over the past 20 years. The Art Index provides an adequate overview of what is happening in the Estonian classical art market: which works and artists are the most valued in public sales, how the price of art has risen over time, how the volume of auction works has changed over time, etc. For example, it turns out that Konrand Mägi's creations have been sold for the highest price at Estonian art auctions, but Eduard Wiiralt's works are also popular. It is also interesting to note that the price growth percentage of Wiiralt's works has been one of the highest over the years (70% per year). The index is free of charge and the publication of the index right now should be of interest to art lovers, as the auction season in Estonia starts in October and November.
One of the goals of the Art Index is to be a tool for people who want to invest in art as an asset class. According to Kaljuvee, the art index can be compared to a stock index or a real estate index. "If the stock index shows how the stock market or part of the stock market is doing and is constantly changing over time, then the same is true of the art index. If a person knows nothing about art, then based on the art index, even a beginner can start taking very sure and bold steps, because the information from auctions is reliable and based on facts. We want to give a sense of security to those who want to invest in art, but feel insecure in the art world," explained Kaljuvee.
Elsewhere in the world, art indexes are widespread and work very well. More well-known and larger art indices such as Masterworks , Artprice and ArLogic provide a real-time overview of how the art market is constantly changing, how the prices of works of art have changed over time, what is the value of the works of a particular artist at the current time, what is the volume of the art market, etc. However, these databases are very expensive and do not provide an overview of Estonian art and artists.
The Future of Art Index
The current Estonian art index is based on traditional art, which means that information from galleries does not provide a competent overview of the works of young artists. "Based on the art index, it's very easy to go for something and invest in, for example, works by Eduard Wiiralt or Jüri Arrak . At the same time, you can find real gems among young artists, but their works are not on auctions and therefore there is no relevant information about them," said Astrid Laupmaa , co-founder and CEO of Kanvas.ai.
According to Laupmaa, Kanvas.ai is working to ensure that contemporary art, young art and young artists also reach the art index. "Technology has made information so accessible that we could and should have an overview of all art transactions. Our idea is for the art index to be self-complementary and become a tool for all active galleries who want to add their sales to the database. If a young beginning artist sells one work, this information could also reach the art index, and if over time the prices of this artist start to rise, this information will be reflected in the art index accordingly. In this case, young artists would become also more visible" Laupmaa explained.
In the near future , there are plans to create an index for NFT art as well. "NFT art is a place where it's very easy to get lost - anyone and anywhere can make NFTs , and very often the artists themselves do it. The NFT art index would also give buyers a sense of security that they are really buying a quality piece that has value on the secondary market. Initially, we will start collecting NTF art information from the sales of NFTs created on the Tezos blockchain which take place through the Kanvas.ai environment," Laupmaa said.