When a work of art changes ownership, it is often accompanied by a wealth of documentation, such as certificates of authenticity, receipts, and condition reports. Historically, this information has been stored in physical folders, which, according to the founders, can complicate matters in the event of inheritance, division of assets, or insurance claims. The idea of moving the administration to an app is to replace the folders and instead give art owners a unified, digital overview. This transition is what co-founder and CEO Karolina Bertorp wants to accelerate.
Our thesis is that many collectors see value in having their collection documented and organized, but the threshold for getting started has been too high. Therefore, we have placed great emphasis on making Monogram as simple and intuitive as possible to use, says Karolina Bertorp.
The function of logging holdings is at the core of Monogram. Here, the user can collect information about dimensions, images, invoices, certificates, and other documentation. But the service encompasses more than just the administrative aspects.
After the summer, the second "part" of the app will be launched, namely a marketplace for direct sales (peer-to-peer). To ensure secure transactions, the parties verify themselves via BankID. In addition to trading, the user will also have access to ongoing valuations and statistics, which should provide a visual and financial overview of the entire art collection.
It is a natural evolution of the platform. When all the information about a work is already collected, the step to a sale becomes very simple, says Karolina Bertorp.
The idea is to offer a sales process that can be handled internally with the seller's own network. This eliminates the need for a third party to manage traditional viewings or auctions.
Challenges an Established Fee Model
Because transactions occur directly between users, without intermediaries that assess or physically store the art, pricing differs from existing players.
Our fee model differs significantly from those of traditional auction houses. Selling through Monogram costs around 5 percent of the accepted price, which is charged as an advertising price for the seller.
The competitive situation on the market is characterized by classic institutions, but the new concept does not position itself as a direct replacement for these. The lack of in-house experts who inspect the art keeps costs down.
The low fees are made possible by the fact that, unlike established auction houses, we do not handle works physically or carry out our own verification processes. The service is therefore not intended to replace auction houses, but to function as a complement.
The cost difference becomes particularly clear when looking at the commission levels in traditional trading, where fees are distributed on both the seller and buyer sides at each hammer fall.
Traditional players such as Bukowskis and Stockholms Auktionsverk usually charge around 15 percent in seller's commission and 25 percent in buyer's commission, which means that up to 40 percent of the value of the transaction goes to intermediaries, explains Karolina Bertorp and continues:
We believe that many works can find their next owner within the seller's own network or through trust-based contacts – without such a large part of the value having to disappear in commissions and fees.
Own Responsibility in P2P Deals
Selling high-value goods online requires special requirements, especially when trading occurs directly between private individuals. Since the company behind the app does not carry out any physical quality control of the art that changes ownership, the system instead relies on the security that identity verification and the personal network provide. This means that a large part of the practical responsibility is shifted to the users.
The responsibility lies with the buyer to determine the appropriate level of control before a purchase, for example, whether the work should be inspected physically before the transaction is completed.
The development of this category of trade has so far had a slower adoption of e-commerce solutions compared to other consumer products online.
We see how other industries have evolved through digital platforms where users meet peer-to-peer. In the art market, that development has been slower. We believe the timing is right now.
"The Market Has Hitherto Lacked Solutions"
The service has grown out of a clear need in the market, according to the founders. At the same time, their own figures show that only two percent of today's art buyers use digital tools to manage their holdings.
The fact that only a fraction of collectors currently use digital tools could be interpreted as the target group simply preferring the analog. But Karolina Bertorp believes the reason is different.
That is a relevant question. Over 40 percent of art buyers would be interested in a digital aid, provided it is easy to use and affordable. This suggests that the low usage is not necessarily due to a lack of interest, but rather to the fact that the market has hitherto lacked solutions that are perceived as sufficiently user-friendly and relevant to the target group, she says.
Before the broad rollout, the platform has already been tested. The company has allowed a test group to use the system to see how the transition from analog management to a digital database works in practice.
Feedback from our test users strengthens that picture. Several describe the process of cataloging the collection as both interesting and engaging. Once the works are registered, users feel they get a completely new overview of their holdings.
In addition to being able to see their works in different visually appealing views, they have access to statistics and insights about the collection, while also being able to discover and connect with other collectors who have chosen to show parts or all of their collections.
Looking Towards the Rest of the Nordics
With financial backing from investors Ricard Constantinou and Viktor Sandberg, there is capital for continued product development. Initially, all focus is on the domestic market to build a functioning flow, before the concept is taken outside the country's borders.
We will initially focus on the Swedish market. Our assessment is that it is important to establish a strong user base and a functioning ecosystem in the home market before we expand further.
Once the app has gained a foothold in Sweden, there is a planned plan for which countries are next in line, which is based on geographical and cultural proximity as well as purchasing patterns.
The next natural step is the rest of the Nordics – Denmark, Norway and Finland. The Nordic countries have many common denominators when it comes to collecting behavior, art preferences and cultural references. In addition, there are already strong relationships and contacts between collectors, galleries and art actors across borders, which makes the region particularly interesting to us.
The goal in the long run is to connect the region's art enthusiasts in a common digital environment.
Since Monogram is based on networks, trust and relationships, we see great value in first creating a strong Nordic marketplace where collectors can easily discover, follow and trade with each other across borders, concludes Karolina Bertorp.