Masterworks.io LLC, a New York City-based investment platform focused on securitizing the works of iconic artists, announced that it obtained a $110 million Series A investment at a valuation in excess of $1 billion.
What Happened: Masterworks is a members-only platform where investors can buy and sell shares in selected paintings acquired from the leading auction houses and galleries and from private collectors.
“We buy paintings and we file them with the SEC, just as you would take a company public,” said founder and CEO Scott Lynn in a CNBC interview. “So, each individual work of art is a public company that we’re selling shares in. And we now have investors trading shares in the secondary market, as well.”
Investors can buy or sell shares before a painting is sold and the profits are divided among its shareholders. The platform includes works by Jean-Auguste Renoir, Marc Chagall, Pablo Picasso, Alexander Calder, Andy Warhol, Jean-Michel Basquiat, Keith Haring and Banksy.
What Happened Next: The company, which has 100 employees, plans to use the capital raised in the new investment to expand its operations. The new funding round was led by the venture fund Left Lane Capital, with participation from strategic investors including Galaxy Interactive and Tru Arrow Partners.
“We are thrilled to complete our Series A with such a high-quality group of investors, including our lead investor, Left Lane Capital,” said Lynn. “Left Lane understood our market, business model mechanics and drivers in a more nuanced way than anyone else.
“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.”
Left Lane Founder and Managing Partner Harley Miller praised the Masterworks concept by noting how its platform 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.”
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