Art Ratings And Tokenisation Will Feed Artists

Assets, Platforms

A new art tokenisation platform is important news for the art rating industry.

The rating of an artist is the indication that helps evaluate the value of an artwork, the rating of an artwork helps to understand the investment characteristics of art. 360X AG reports the successful completion of first Proof-of-Concept transactions with tokenised art.

There are many people who have experienced the frustration of following a famous artist throughout their early years only to find that the vast majority of their work is financially out of reach. Participation through fractionalisation alleviates this problem, allowing individuals to invest in their favourite artists. Art ratings and tokenisation are the two key ingredients which would enable more people to collect art and make long-term investments, which leads to more artists being able to make a living from their art.

360X Art AG runs a tokenisation platform for art of 360X AG. It announces that it has entered into a strategic partnership with a group of industry leaders in the European art market, Rüdiger K. Weng, Weng Fine Art AG and Johann König. Under the terms of this partnership Weng, WFA and König have invested in 360X Art AG in return for a stake of more than 20%.

Based in Frankfurt, 360X Art AG is a platform that builds and operates a dedicated, trusted digital ecosystem and infrastructure for the digitisation, tokenisation and fractionalisation of both high-quality physical as well as digital artworks. The company is directly connected to the recently announced trading platform of 360X, where digital tokens of art assets and other high-quality investment objects are made accessible, investable and tradable for investors.

The new technology is strongly needed to bring new liquidity, transparency, trust and democratised access to the art market and fine art investments. It could add a new dimension to trading art and will support professional financing structures to initiate future growth of the art market.

fabric with abstract ornaments and sequins

Comparing Art on One Platform

Platforms

In response to the Corona restrictions for museums, art associations and galleries, bpar has established a central platform for specially digital art events with bpar.DIGITAL. It is a project of Beisel Public Art Relations, an initiative of Healthcom GmbH.

Museums, art associations, galleries and collections can upload their digital art formats there free of charge. The virtual tours and guided tours, artist talks, videos and podcasts are not only aimed at art enthusiasts and collectors. In addition, the free offer aims to facilitate access to a wide range of digital art offers for a broad target group, especially under the difficult pandemic conditions.

bpar.DIGITAL is a private initiative – with the intention of promoting the visual arts and culture and bringing them closer to a broad public via digital channels.

Online Brokerage of Mezzanine Capital for Real Estate Projects

Platforms, Read

Real estate investments are a bit like finding a life partner.

The expectations of capital seekers and investors are often far apart – and the disappointment is great when you have to move on after a hopeful commitment without having achieved anything. Along with the importance of mezzanine capital, there is also a growing desire for digitization and standardization of the placement process. Interested parties can now register on the new digital platform Mezzalite. Matching starts in spring.

Exciting insights came to light after the soft launch

In the current investment environment with very low interest rates, the allocation of mezzanine capital is increasingly in demand, especially among family offices. But the search for a partner is full of traps, time-consuming detours and often ends unsuccessfully. Rapid property development is essential from the perspective of the investor and his financier.

Painful experiences can be avoided if a standardized approach contributes to the analysis of whether the partners are “on the same wavelength”, and whether there is a good chance of establishing a professional relationship as a result. “Applied to real estate developers and investors looking for capital, this means that you can avoid many disappointments in advance with a well-digitized process,” says Georg Stampfl, Managing Director of Mezzalite GmbH.

Georg Stampfl © Mezzalite/Ivana Jovic
Georg Stampfl © Mezzalite/Ivana Jovic

During the registration phase, digital expert Stampfl and his colleagues carried out an analysis of around 100 investors and capital seekers on their new digital platform Mezzalite and found out which main reasons make it difficult to find a partner in the mezzanine capital sector.

Hurdle 1: The match has so far been a matter of chance

Getting to know investors is not easy for real estate developers. So far, according to the study, it has mainly been third-party contacts, often word of mouth, that have brought the two parties together. Media and search engines also play a role in getting to know each other. The bottom line is that searching and finding is unstructured, and matching is a matter of chance. In the end, 50 percent of the cases fail, according to the Mezzalite study, for example because the project does not fit the investment profile and / or the price expectations diverge too much.

Hurdle 2: The search is too time-consuming

Finding investors and borrowers together often takes more time than necessary. This is particularly bitter if, for example, some investors do not really listen to the capital seekers. Months of negotiations follow, only to find out in the end that the project would not have suited the investor right from the start. Some people looking for capital, on the other hand, shy away from the effort of looking for capital for smaller real estate projects, although these could also be of interest to investors.

Hurdle 3: Fear of competition makes checking seriousness more difficult

Investors expect project developers to show their track record in the first step and disclose the people involved, e.g. their own construction workers on board, external partners, banks, securities, etc. The borrower, on the other hand, acts cautiously when releasing data, after all he is faced with tough competition in which he has to protect his market position.

Hurdle 4: Complexity of the process and lack of comparability

Investors are often faced with those looking for capital who do not have a clear idea of ​​how to raise capital or what the capital providers are. The financier, on the other hand, has no way of comparing different conditions. In addition, he is confronted with a wide variety of requirements, for example from what amount a family office invests, what expectations it has in terms of security and what project presentation it would like.

Conclusion

For Mezzalite one thing is certain, says Georg Stampfl, co-founder of Mezzalite GmbH: the automation of the preselection and a standardization of the process for the allocation of mezzanine capital is the most important step towards the goal. The financing partners can – almost like when looking for a partner – handle almost everything digitally, from “dating” to “matching” and “monitoring” to feedback. This has enormous potential to simplify mezzanine capital transactions and reduce transaction costs. This more efficient “partner search” process lays the foundation for a trusting cooperation. After the digital match, the personal negotiations and discussions that are essential for the success of the real estate project or investment are pending.

As with the partner exchanges mentioned at the beginning, the decisive question is what quality are those who register on such a platform. In addition, the quantity is crucial – will there be enough potential partners? Ideally, quantity and quality go hand in hand.

Legal Issues in Ratings

Books, News, Notching, Platforms, Procedures, Registrations, Regulations, Repositories

Ann-Kristin Achleitner and Oliver Everling (Editor): Legal Issues in Ratings: Fundamentals and Implications of Ratings for Agencies, Investors and Companies Advised, Betriebswirtschaftlicher Verlag Th. Gabler, Wiesbaden 1st edition November 2005, http://www.gabler-verlag.de, hardcover, 470 pages, ISBN 3-409-14314-9.

The issuing of ratings by external rating agencies as well as internal ratings are of increasing relevance for the refinancing processes as well as for investment decisions on the part of investors. The book outlines the main legal implications of ratings for agencies, investors and rated companies.

Ann-Kristin Achleitner und Oliver Everling (Herausgeber): Rechtsfragen im Rating: Grundlagen und Implikationen von Ratings für Agenturen, Investoren und geratete Unternehmen, Betriebswirtschaftlicher Verlag Dr. Th. Gabler, Wiesbaden 1. Auflage November 2005, http://www.gabler-verlag.de, gebundene Ausgabe, 470 Seiten, ISBN 3-409-14314-9.