Masterworks.io, the first investment platform to securitize blue-chip art, has secured $110 million Series A investment at a valuation in excess of $1 billion. The round was led by NYC-based venture fund, Left Lane Capital, with participation from strategic investors including Galaxy Interactive (a division of Galaxy Digital), Tru Arrow Partners, and others.
Masterworks is a members-only platform where investors can buy and sell shares in iconic works of art, by artists such as Basquiat, Banksy, Picasso, and more.
Art is estimated to be a $1.7tn asset class, and contemporary art has appreciated 14.0% from 1995-2020, outperforming the appreciation rate of most other asset classes including the S&P 500, real estate, and gold. For centuries, this asset class has only been available to the ultra-wealthy who can afford multi-million-dollar paintings. Masterworks' vision is for any investor to be able to allocate to art, just as they do with stocks and bonds.
The company, founded by serial entrepreneur Scott Lynn, plans to use the capital to accelerate growth into all types of distribution, including financial advisors, wirehouses, and institutions.
"We are thrilled to complete our Series A with such a high-quality group of investors, including our lead investor, Left Lane Capital. Left Lane understood our market, business model mechanics and drivers in a more nuanced way than anyone else," mentioned Lynn.
"Art is among the largest asset classes remaining that has never been securitized. There are more than 9,000 firms that help investors allocate to venture and private equity, but none other than Masterworks that facilitates fractional investment in art."
"Despite our strong traction, Masterworks is still in the very early innings of building out a seminal company seeking to provide outperforming and non-correlated art investment products to all types of investors."
Masterworks is headquartered in New York City with over 100 employees; the company has been bootstrapped to date, and is currently profitable.
Left Lane Founder and Managing Partner, Harley Miller, noted that "while many of our peers in the venture community have deployed capital into other alternative investment spaces -- ranging from sports memorabilia, Pokemon cards, vintage sneakers and the like -- we were keen to pursue an investment into a company playing in an asset class that was fundamentally much larger, more unique, and with proven appreciation rates over decades. Masterworks is democratizing an asset class that is an order of magnitude larger than all of the aforementioned combined, and has a meaningful head start building a framework that can potentially raise billions of dollars a year in capital."
"As a firm, we have known the CEO Scott Lynn for many years, and have never seen a better founder-market fit in our experience as investors. We are honored to partner with Scott and the Masterworks team as the first investment out of Left Lane's second fund," continued Miller.
Glenn Fuhrman, Co-Founder of Tru Arrow Partners and a prominent art collector and Founder of the FLAG Art Foundation, added, "For centuries, only a small and wealthy fraction of the population has been able to participate and capitalize on the appreciation and other favorable characteristics of fine art. Masterworks has changed that by creating a scalable online model that, for the first time, gives any investor the opportunity to invest in a major artwork."
"We believe this model unlocks significant unmet demand, allowing access to art as an asset class for all investors. We at Tru Arrow Partners are pleased to partner with Masterworks at this inflection point of growth to support their global expansion for many years to come," continued Fuhrman.
Sam Englebardt, Co-Founder of Galaxy Digital and General Partner of Galaxy Interactive, added, "Scott's unique background as both a pioneer of digital advertising and an astute collector - and student - of contemporary art make him the perfect founder to democratize access to this asset class. Financial inclusion and empowerment are core principles around which Galaxy was founded and we're proud to support Masterworks in this critically important mission."
Goldman Sachs & Co. LLC served as financial advisor to Masterworks on the transaction.
About Masterworks
For press inquiries, please contact Matt Sutherland at msutherland@masterworks.io. To learn more about Masterworks.io, visit Masterworks.io.
About Left Lane Capital
Left Lane Capital is a Brooklyn, NY based growth-equity firm that invests in high-growth Internet and consumer technology businesses globally. Its mission is to partner with extraordinary entrepreneurs building category-defining businesses. Left Lane has led investments in fintech companies including M1 Finance, Freetrade, Wayflyer and more. For more information, visit leftlanecap.com.
About Tru Arrow Partners
Tru Arrow Partners is an investment partnership based in New York, formed specifically to partner with investing families from around the world. The firm's investing focus is on private growth technology companies primarily in the global internet, software, consumer, and fintech industries. The firm was founded by Glenn Fuhrman, James Rothschild and Adam Silverschotz. Prior to launching Tru Arrow, Glenn co-founded MSD Capital, L.P., the private investment firm for Michael Dell, the founder and CEO of Dell Technologies, and from 1998 through 2019 served as its Co-Managing Partner. James was co-founder and Managing Partner of West Arrow, a Partner at Lepe Capital and has directed his family investment vehicles for 15 years. Adam was most recently at TCV where he led their investments in ByteDance and Capsule after spending several years at Coatue where he was a Managing Director based in Hong Kong.
About Galaxy Interactive
Galaxy Interactive, a division of Galaxy Digital, is a stage-agnostic venture fund focused on companies operating at the intersection of content, finance and technology. Since its inception in 2018, the firm has been amongst the most active videogame and blockchain investors in the world, with $650mm in AUM across its two funds and investments in more than 75 companies.
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Original Source: Masterworks, the Only Art Investing Platform, Becomes the Latest Unicorn
