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April 20, 2015

Auctionata Guarantee is a Guaranteed Risk

by & Robert Grunder

Hyperbole, documentation errors, mistakes, accepted norm at Auctionata.

Analysis of statements, interviews, press releases by Auctionata CEO Alexander Zacke and International Managing Director Ben Hartley, coupled with a review of the Terms & Conditions exclusions that void the 25 year Auctionata Guarantee demonstrate hyperbole, exaggeration, errors and omissions are routine at Auctionata. It appears the majority of Auctionata communication is simply regurgitated, becoming in essence, journalistic propaganda, accepted without equivocation by the American Press, including: Forbes, Skates, The New York Times, Luxury Daily, e-commerce bytes.

In sharp contrast, German Press, including Der Standard, Wirtschaftsblatt and The Wall Street Journal (German edition) appear more critical and apprehensive, challenging the viability of Auctionata's investment to build a 5,000 foot New York TV Studio. Alexander Zacke and Ben Hartley acknowledge the importance of establishing consumer trust. Establishing trust is an uphill battle as collectors, especially knowledgeable ones, repeatedly observe factual untruths, erroneous and misleading comparisons, blatant counterfeits, missing provenance, documentation errors, flawed condition reports, all allegedly sanctioned by freelance, paid by the minute, "experts". And bizarrely, Terms & Conditions loopholes in the widely touted 25 year Auctionata Guarantee indicate claims won't be accepted for Lots with errors and omissions; well, that's an enormous amount of lots. Perhaps Auctionata should re-draft its Guarantee to ensure it is NOT meaningless and useless.
  • Are the Auctionata Investors aware of the consistent negative customer reviews, aside from 5 stars awarded by CEO Alexander Zacke, which skew towards 1 star at Yelp, Trustpilot, Ripoffreport, Reseller Ratings, indicating buyers and consignors are universally dissatisfied with Auctionata's poor/ineffective services, also warning Auctionata's condition reports are NOT objective, but worse, inaccurate and incomplete. The website mentions "Buyer Protection", from the reviews, no user felt that Auctionata cared to remedy its mistakes, nor did they receive any buyer protection.
  • It is inconceivable Auctionata Investors would agree the New York expansion is so successful, they cannot wait to burn more cash by duplicating the 5,000 foot TV studio and branch office in Hong Kong and elsewhere.
  • What is Auctionata Management doing to improve massive unsold Lot rates inconsistent with the alleged 70% sold through rate communicated to the press. In 2014, according to data available at Live Auctioneers, the Unsold rate was 41.2% for the 12,091 lots offered at Auctionata AG and Auctionata Inc. Try to get that same information at Auctionata, and learn that level of transparency is unavailable. The Unsold lot rate for New York auctions since October 2014 is much worse, 58.8%, and some NY suctions, like African & Oceanic Art, where ONLY 6 lots sold, exceed 90% unsold. Clearly, Auctionata Management has not been objective about its poor New York performance.

Why does investor Sylwester Janik think Auctionata is an excellent example of what to look for now that Series C funding has reached $95 million.


Recently Auctionata announced it had closed €42m Series C funding, led by Warsaw's MCI Management and joined by London’s Kreos Capital, New York's Hearst Ventures and Hong Kong's Yuan Capital.
“We are excited to back Auctionata’s ambitious growth plans,” said Sylwester Janik, partner, MCI Management. “The company is an excellent example of what we look for in our investments: a disruptive business model combined with a high quality team and a leadership with strong industry experience.

Does Alexander Zacke REALLY believe all art appreciates?


Alexander Zacke Art is a safe investment
Alexander Zacke states "Art is Not Only Stable but Safe", 2014 Interview, Auctionata Magazine "Art is not only a stable, but also a safe, investment. By safe, I mean that afterwards, the item has appreciated in value. Art is therefore a long-term, stable and safe investment."
CEO Alexander Zacke may be new to the Corporate world, but that doesn't excuse irresponsibility. Alexander Zacke must realize it is unethical to guarantee art is a stable and safe financial investment, especially since the majority of art sold on Auctionata could hardly be considered collectible. For reference, according to data on Live Auctioneers, 41.7% of all sold auction Lots during 2014 were under €2,000, contrary to the Company's statement that most lots sell between $5,000 and $20,000.

Was Auctionata fastest growing German Company as Alexander Zacke stated in 2013 IDCEE speech?


Alexander Zacke ICCEE
Alexander Zacke tells 2013 IDCEE Conference Auctionata fastest growing company
Alexander Zacke mistakes facts in 2013 IDCEE speech: "Auctionata is probably the fastest growing company in the world and GMV (Gross Merchandise Volume) currently grows +6.5% per week, and has done so for the the past 12 consecutive months."
  • Auctionata does NOT rank among top 25 fastest growing Internet companies according to Informalo.
  • The Next Web confirms Auctionata didn't make the list of top 5 fastest growing German companies either.

Propaganda or Press?


The American press, including Forbes, Skates and Private Investors seemingly have an unexplained love affair with Alexander Zacke and mostly regurgitate Company statements and press releases, without equivocation, It is surprising the American Press accepted without challenge the 2014 Auctionata press release announcing record sales of €31.5 million, which Auctionata claims converts to an astonishing $41 million; put aside the nearly 30% premium, NO specific source of revenue was provided, nor is there any detail on the website to show this either.

In contrast, the German Press including Der Standard, Wirtschaftsblatt and Wall Street Journal (German edition), is sharply more critical about Alexander Zacke and the Asian Art scandal at Dorotheum that came to light shortly after Mr. Zacke's departure. The German Press is evasive as to why Alexander Zacke left his full time job at Dorotheum in 1995 as Department Head of Asian Art and fails to provide specifics about the consignment sources largely responsible for the sudden increase in Asian Art volume at Dorotheum at that time.
Alexander Zacke states on linkedin: " I took over their Asian Art department with an annual sales level of 1 million ATS. When I left the company four years later, annual sales were at 45 million ATS."
The German Press is circumspect regarding conflict of interest accusations with respect to Asian Art consignments from Mr. Zacke's family during his tenure as Asian Art Department Head, stating "no one is willing to talk about it on record".
Von Marcus Pfeil, Technology Reporter The Wall Street Journal doesn't hold back providing alarming perspective a 6/21/13 report about the Dorotheum Asian Art scandal: "Speculation is Alexander Zacke was embroiled in the 1997 Asian scandal at the Vienna based Dorotheum. The renowned auction house then auctioned incorrectly attributed objects. Although Zacke worked as an Asian expert at Dorotheum from 1990 to 1995. Later, however, it turned out that some of the wrongly attributed artifacts had been auctioned in 1995, during Zacke's time at Dorotheum - coming from Galerie Zacke."
"Most of those who were involved at the time, do not want to talk. A former Dorotheum executive only says they had all made mistakes, Zacke's successor at Dorotheum declined to speak on the phone, and a renowned Asian expert who for years did business, with the Zacke's, even says she was afraid of this family."
"Perhaps this man is just looking for a second chance. As of today, he has not been found guilty of a crime anyway. Otherwise we would not have invested in Auctionata" says Lars von Holtzbrinck Ventures Langusch. 15.5 million euros has been collected by the venture capitalists Holtzbrinck, Bright Capital, Kite Ventures, Otto eVentures and starting this year, Earlybird wave."

There were more than 30 dealers selling art on eBay in 1999.

“I started to sell on eBay when there were 30 people in this business or even less,” he said. “I saw the whole growth until where it is now…” - Alexander Zacke interview, Gründerszene
eBay launched in 1995. Alexander Zacke's recollection is incorrect; there were far more than 30 dealers selling fine art on eBay in 1999, Joseph K. Levene, author of The Fine Art Blog, and President of Joseph K. Levene Fine Art, Ltd., began selling on eBay in 1999. Joseph K. Levene Fine Art, Ltd., was an original Sothebys.com fine art charter member, one of 2,000 art dealers in the United States and Europe, among a select group chosen to also sell on eBay during the first Sotheby's/eBay partnership.

Alexander Zacke fails to mention team of 200-250 Experts are freelance employees


Alexander Zacke Auctionata
Alexander Zacke boasts "Auctionata has largest network of renowned experts who value, authenticate & curate art

Auctionata "Experts" are freelance employees paid by the minute via PayPal.

Full time commitments by the team of 200 to 250 Auctionata freelance "experts" is highly problematic, for several reasons. Relying on freelance "experts" is a marketing and legal liability; in addition, although Auctionata clearly states its valuations are NOT appraisals and each lot is authenticated and checked, there is an unusually high degree of counterfeits sold. Being freelance may explain why so many Auctionata lots contain errors, inaccurate or vague condition reports, erroneous and misleading comparisons that reference irrelevant price comparisons, all without specifics and NONE linked.
Auctionata Experts are paid by the minute via PayPal; states Alexander Zacke: "our experts are paid fixed-fee based on the number of minutes they spent on the case. That payment is done automatically and is processed into their PayPal accounts. If the item goes to auction, then they will also receive a commission."
  • Conflicts of interest by the freelance expert team is a serious issue, especially for consignors who want to ensure valuations are NOT biased.
  • Many "experts" have full time jobs and/or own/represent competing businesses selling/involved with similar items they evaluate part-time for Auctionata. Several high ranking Experts own full time businesses, some online too, which compete with Auctionata. Of course, the names of the business are withheld on the CV's posted on Auctionata, but visible on Google and Linkedin. For reference, neither Christie's, Sotheby's nor frankly, ANY legitimate auction house or gallery would ever tolerate employees with side businesses, yet this a conflict of interest that has serious implications and is a scandal waiting to happen.
  • Do experts recuse themselves if they have previously dealt with a consignor at THEIR business?
  • What is the review procedure for lots documented by its freelance"expert" team and what happens to experts who have a high incidence of making errors and listing counterfeits?
  • Do Auctionata experts self consign material and/or does a third party get involved?
  • Lack of experience is a serious concern with Auctionata Experts and Department Employees given the extent of mistakes which are common in their listings; many "Experts" are 2014/15 attendees of Appraisal programs offered by Sotheby's, Christie's, etc.
  • What steps does Auctionata take to ensure its Experts are not convicted fellons; involved in fraudulent activities? After all a former Auctionata Expert was convicted of fraud and is no longer employed by Auctionata.
  • Auctionata should engage a neutral consultant to identify the numerous counterfeit artworks sold to date, and take pro-active action to inform their buyers and offer the opportunity to refund the sale, including payment of shipping.

Freelance "experts" get commission based incentive IF respective lot consigned & sold.

Auctionata terms of guarantee doesn't guarantee much.


Auctionata Guarantee
Auctionata erroneously claims all lots have been thoroughly checked, valued and authenticated.

Is every lot really guaranteed for 25 years at Auctionata?


For the answer, you need to review over 17K words in the Terms & Conditions section of the Auctionata Guarantee. For comprehension, word recommends a college education but legal counsel is more appropriate. The Terms & Conditions section is alarmingly confusing, particularly when you realize Auctionata has two different Terms & Conditions sections, one for Auctionata AG, the German Auctionata, and another for Auctionata, Inc. the US Company. Review both Terms & Conditions and you will be more confused once you read the extensive list of exclusions that VOID Guarantee coverage for the advertised 25 years.

Auctionata Guarantee
Auctionata AG & Auctionata Inc. have different Terms & Conditions

Auctionata AG Guarantee fine print states: Please note that this website allows you to purchase goods from Auctionata AG or Auctionata, Inc. - a wholly owned US subsidiary of Auctionata AG. Both organizations operate with a different Limited Warranty. The Auctionata Guarantee below apply for all purchases of goods at auction or via the online shop in which Auctionata, Inc. acts as the seller. For all purchases of goods at auction or via the online shop in which Auctionata AG acts as the seller, this Auctionata Guarantee apply.
  • Why does Auctionata AG claim there is a 25 year guarantee on all Lots when the Terms & Conditions stipulates coverage is ONLY VALID when conducted by an AUCTIONATA EMPLOYEE.
  • Auctionata employees NEVER provide valuations only the freelance experts, yet the Auctionata AG Terms & Conditions states the Guarantee only applies if Employees do valuations.
  • Auctionata AG Terms & Conditions EXCLUDES any Lot designated as Museum Copy which would apply to any lot designated as an "After".

No Lot documented as an "AFTER" Covered by Auctionata Guarantee


Auctionata After not covered
Any Lot Designated as After NOT COVERED by Auctionata Guarantee

If Buyers don't read the Auctionata AG TERMS & CONDITIONS fine print, the website does little to ensure buyers realize ALL Lots documented as AFTER, MUSEUM COPY and/or REPRODUCTION are excluded from 25 Year Guarantee coverage.
11.2 If a catalogue description explicitly refers to an item as a “copy” (e.g. as a “museum copy”), then the item in question will be deemed purchased as a copy and not as an original, and will thus not be covered by the Auctionata Guarantee in this respect. Likewise, if the catalogue description explicitly describes or designates an item as being "of doubtful authenticity", then said item will be deemed purchased not as an original but as an “item of doubtful authenticity” and will thus not be covered by the Auctionata Guarantee in this respect.

Stating ALL LOTS covered by 25 Year Auctionata Guarantee is DECEPTIVE.


Why does Auctionata AG falsely state every item is AUTHENTICATED when numerous lots are EXCLUDED from any Guarantee.
  • The website deceptively communicates "every item available to bid for on Auctionata or on sale is checked, valued and authenticated by our specialists and experts"?
  • Auctionata AG undermines itself by stating it "values trust", but knowledgable collectors will immediately realize Auctionata sells buckets of afters, copies and doesn't even asterisk these lots STATING the GUARANTEE doesn't apply.
  • Auctionata AG excludes Guarantee coverage for lots where documentation is provided by non Auctionata employees.

Terms and Conditions at Auctionata, Inc. indicate numerous exclusions that  void 25 Year Guarantee

11. Limited Liability: "Our liability is subject to the following terms, and as may be described elsewhere in these Conditions of Sale: (a) We agree to refund the Purchase Price in the circumstances explained in Section 12. In addition, and subject to the terms of this Section 11, the total liability of us and the Seller to you in connection with the sale of any Property shall be limited to the Purchase Price actually paid for the Property. Otherwise, we (including our officers, employees or agents) and the Seller are not responsible for: (i) the correctness of any statement of any kind concerning any Property, whether written or oral, (ii) any other errors or omissions in descriptions concerning any Property, whether written or oral."

Auctionata gets first 5 star review from CEO Alexander Zacke


Alexander Zacke 5 star Trustpilot Auctionata review
Alexander Zacke 5 star Trustpilot Auctionata review

  • 2 German users gave Auctionata five star Trustpilot reviews in 2014, Anne and Oksana, but 3 Auctionata buyers are less enthusiastic,
  • Doesn't Alexander Zacke realize Company reviews by employees are inappropriate, especially CEO's?

Auctionata customer gives 1 star, warns INACCURATE condition report; faulty iPad app.


Auctionata customer warns INACCURATE condition reports
Auctionata customer warns INACCURATE condition reports

A second disappointed Auctionata customer also gave 1 star review on Trustpilot; 2/23/15, after receipt of a military watch; warning: "do not trust their condition reports"and said "they only provided a Eur 50 compensation" for the inaccurate condition report by the Auctionata "expert". Similar negative Auctionata customer reviews can be viewed at Yelp, Ripoffreport, Reseller Ratings. Clearly users have a problem with Auctionata's overall operations and its insufficient condition reports generated by the team of so called "Experts", many of whom have entreprenierial experience rather than supervisory/management auction and gallery experience.

Why did Auctionata announce its 12/12/12 launch was 1st live auction on Internet?


    2012 Auctionata launch was NOT 1st Live Auction on Internet
    2012 Auctionata launch was NOT 1st Live Auction on Internet

Exaggeration appears to be a constant theme at Auctionata


  • We are certain Alexander Zacke knows better; after all he boasts he was a Titanium Power Seller who allegedly achieved $10 million annual eBay sales.
  • The technology that Auctionata uses is hardly groundbreaking; live streaming Auctionata auctions look clumsy; the auctioneers speak about lots in a language similar to shills on QVC, and NOT anything you would hear by auctioneers at Phillips, Christie's and Sotheby's.

Let's face it, the Auctionata claim is FICTION; long before Auctionata launched on 12/12/12, Christie's LIVE enabled users to view, see and hear auctioneers auction lots offered in real time from sales rooms around the world. And long before the 2012 launch of Auctionata, Sotheby's had the same ability for viewers to view auctions anywhere on the Internet in real time too.

Why isn't Auctionata Management scrupulous about selling quality online?


Why do many Auctionata lots have sloppy documentation, erroneous comparisons and even counterfeits?
Why do many Auctionata lots have sloppy documentation, erroneous comparisons and even counterfeits?


A report in The New York Times confirms online buyers are worried "about provenance and authenticity" and indicates "the top end of the market is generally less suited to online sales”. International Managing Director Ben Hartley observes "online buyers feel comfortable up to about $10,000". Ben Hartley says he wants to provide "seamless user experience", yet Auctionata has failed to implement a proactive system to protect consumers from fraud, counterfeits, sloppy documentation, errors which are common in listings and erroneous comparisons?

Auctionata condones sloppy documentation, erroneous comparisons, counterfeits too.


For reference, International Managing Director Ben Hartley stated a vastly different point to Toovia, which we recommend you take with a grain of salt; "Our specialists vet and evaluate every piece sold at Auctionata.com and all purchases come with a 25 year guarantee".On this topic, Joseph K. Levene stated in The Fine Art Blog "The majority of lots offered for sale on Auctionata lack documentation clarity and include either vague support or no support. Too often lots sold exclude obvious information like date of sale; sale number; lot number; vague references to comparable sales results, lacking specificity/accuracy, many without links that art professionals and collectors understand and require."


Why did Auctionata "Expert" state Arp Sculpture in "good condition" when photographs indicate extensive pitting?


Jean Arp Composition dans un Cercle 5, ed 3/5 sold at Sotheby's & Auctionata
Arp in good condition sold at Sotheby's Arp with extensive pitting at Auctionata
Arp in good condition sold at Sotheby's Arp with extensive pitting at Auctionata

Why did the Auctionata "Expert" not disclose the identical Arp, edition 3/5, sold twice at Sotheby's?

Why did Auctionata "Expert" misattribute Tapestry sold for $10.8K as an Alexander Calder even though Calder Foundation NEVER authorized and Alexander Calder NEVER created?


Counterfeit Tapestry NOT created by Alexander Calder nor authorized by Calder Foundation
Counterfeit Tapestry NOT created by Alexander Calder nor authorized by Calder Foundation
Misattributed Alexander Calder Tapestry sold for $10.8K NOT created by Alexander Calder
Misattributed Alexander Calder Tapestry sold for $10.8K NOT created by Alexander Calder


Why did Auctionata"Expert" misattribute painting as a Warhol even though NOT created or authorized by Andy Warhol.


Verso of Counterfeit Painting Andy Warhol did not create nor authorize Withdrawn from Auction No. 72, June 20, 2014
Verso of Counterfeit Painting Andy Warhol did not create nor authorize withdrawn from Auction No. 72, June 20, 2014

It is inconceivable that any Andy Warhol expert at Christie's, Sotheby's, Phillips, etc., would have permitted this obvious Fake to be sold, especially with the bizarre fiction used by Auctionata at the time. There is no excuse for Counterfeits, especially since Auctionata wants you to believe they are the premier auction house. Ben Hartley told Luxury Daily, "the initial valuation process can begin online, but authenticity is still a necessary in-person process".

Why did Auctionata use irrelevant €70K comparable for small Paul Jenkins?


Why did Auctionata Expert indicate erroneous €70K comparable for small Paul Jenkins painting?
Why did Auctionata Expert indicate erroneous €70K comparable for small Paul Jenkins painting?

Contrary to Alexander Zacke's statement: "...We link our work with research found in international art databases." even though this is not implemented in any lot we have seen, including the Paul Jenkins seen above and Lesser Ury painting sold for €130,000, which included sloppy and misleading documentation, including an incorrect stipulation as follow: "comparable subjects fetch up to €180,000 on the international auction market'" even though the SAME painting was sold twice at auction before it was offered at Auctionata in 2014; in 2009 for $92,855 and in 1995 for $87,470.

Why did Lesser Ury Documentation fail to mention 2 prior auctions, fictional provenance & erroneous comparable?


Auctionata Expert failed to state Lesser Fry sold at 1995 & 2009 auctions Auctionata Expert incorrectly claims painting in Private Collection since 1997
Auctionata Expert failed to state Lesser Fry sold at 1995 & 2009 auctions
Auctionata Expert incorrectly claims painting in Private Collection since 1997

More disturbing, the Lesser Ury documentation included provenance details factually incorrect; two auction sales were NOT acknowledged; in an act of fiction, Auctionata stated the painting was in the same Private Collection since 1997, even though the painting was sold in a 2009 auction. We can assure you Christie's and Sotheby's would NOT tolerate similar sloppiness from any Specialist; furthermore, this error was acknowledged by Joseph K. Levene in The Fine Art Blog, yet Auctionata has failed to make a correction.

Why did Auctionata Expert misattribute cut down 2007 Poster as 1980 Cindy Sherman?


Auctionata failed to disclose Lot is cut down poster Cindy Sherman 2007 Martin-Gropius-Bau Berlin poster
Auctionata failed to disclose Lot is cut down poster Cindy Sherman 2007 Martin-Gropius-Bau Berlin poster

Auctionata "Expert" misattributes 2007 Cindy Sherman poster sold for $1,200 as a circa 1980 offset lithograph when in fact, the lot is 2007 trimmed poster attached to metal.
  • Why would a "Photography expert" make such a mistake?
  • Has the so called "Photography Expert" been fired?
  • Has Auctionata informed the buyer and offered a refund?



Auctionata erroneously claims to be the global leader in online sales, when the facts show otherwise.


Actual 2014 Online Art Market Estimate by Joseph K. Levene, The Fine Art Blog
Actual 2014 Online Art Market Estimate by Joseph K. Levene, The Fine Art Blog

Skates issued a February 2015 analysis which overlooked at least $1 billion Online Art volume at eBay and Christie's. Auctionata wouldn't make third place after factoring the $1 billion Skates overlooked along with analysis of Auctionata's Top Selling Lots, only 11 of top 33 lots sold lots were art, and you quickly realize the Skates analysis is deeply flawed.
  • Specifically, analysis of sold 2014 -2015 lots over €91,000 at Live Auctioneers, indicates that Art only comprised 11 of the top 33 Lots at Auctionata,
  • 10 lots sold over €91,000 were watches/clocks, a partnership with Chrono24
  • 8 lots sold priced over €91,000 were cars.
  • 4 lots sold over €91,000 antiques.

Auctionata deceptively erases 44 unsold photography lots in 2/26/15 Auction.


Look quickly, you wouldn't realize 44 Unsold Lots removed Auctionata Photography Sale
Look quickly, you wouldn't realize 44 Unsold Lots removed Auctionata Photography Sale

Removing Unsold lots for LACK of transparency is routine at Auctionata; that way Auctionata just emphasizes sold Lots and sidesteps its particularly high UNSOLD Lot rates. Unfortunately, the Auctionata website editor failed to get that memo as all Auctions continue to state "See All Objects", but you can't.
Click all you like and you will ONLY see the lots sold. For a solution; visit Live Auctioneers and you can see everything, both sold and unsold; sometimes Auctionata even leaves a PDF Catalogue of the respective sale.
Click "See All Objects" & ONLY See Sold Lots
Click "See All Objects" & ONLY See Sold Lots

58.8% of all Auctiontata Lots Unsold in New York, a massive problem


Although the Auctionata website doesn't enable segregation of Unsold Lots, Live Auctioneers does. Since Auctionata launched New York auctions on 10/23/14, 1839 lots have been offered in New York auctions with 58.8 Lots Unsold according to data on Live Auctioneers. This contrasts with the overall 2014 Unsold Lot rate of 41.2% for Auctionata during 2014. Poor results to date in New York demonstrate Auctionata is seriously hemorrhaging Investment funds without being close to profitable given the multi-million dollar price tag of a 5,000 foot New York TV Studio.
  • 58.8% Lots in New York UNSOLD, or 1081 Lots out of 1839
  • Only 6.9% of lots sold in NY were over $10,000, 33 lots total
  • 51% of sold lots in New York are under $2,000.
Auctionata founder and CEO Alexander Zacke: “Since the launch of the weekly live stream auctions in May 2013, Auctionata has grown considerably and has successfully positioned itself among the global leaders for online auctions of art, antiques and luxury collectibles. In the future Auctionata will focus on efficient growth and thereby lay the ground for both organic and non-organic category and geographic expansion.”
  • Contrary to Alexander Zacke's statement, recent results indicate Auctionata's New York expansion has failed to gain traction, and requires immediate steps to improve quality and halt sales of inferior lots and counterfeits.
  • Auctionata investors should question the wasteful decision to build a New York TV Studio that could have been established more efficiently outside New York City; after all, there is NO live studio audience so why waste funds on a studio no one visits.

92% Lots UNSOLD; Auctionata African & Oceanic Art Auction, 3/31/15


Only 6 lots Sold out of 62 African & Oceanic Art Auction, 3/31/15
Only 6 lots Sold out of 62 African & Oceanic Art Auction, 3/31/15

74% Lots UNSOLD; Only 16 lots Sold out of 62, Auctionata Jewelry Auction 3/18/15


Only 16 lots sold out of 62 in Auctionata Jewelry Auction 3/18/15
Only 16 lots sold out of 62 in Auctionata Jewelry Auction 3/18/15

Hyperbole goes unchecked; Jewelry specialist Katherine Palmiter incredulously states "Whether a collector, investor or stylist, a range of people found great items that will not be seen again any time soon at accessible prices."

Is something about to happen to low priced jewelry that no one else knows about?

67.5% Lots UNSOLD; Auctionata Watch Auction, 3/10/15


Only 26 lots Sold out of 80, Auctionata Watch Auction, 3/30/2015
Only 26 lots Sold out of 80, Auctionata Watch Auction, 3/30/2015

Analysis of Auctionata revenue to date indicates that aside from auctions of Watches & Cars, Auctionata is far from a rousing success.


Auctionata may boast rhetoric about growth, revenue, trust and having the largest network of renowned experts; sadly, this marketing charade does not excuse widespread documentation errors/omissions that saddle the website.

Most likely, this is a significant concern that prevents serious collectors from buying/selling at Auctionata. Under the current circumstances, we would NOT recommend buying or selling at Auctionata, given the risks of inaccurate lot details or worse, buying a counterfeit.

In our opinion, we believe it is essential to only buy Online where there is NO doubt as to authenticity. The element of doubt at Auctionata is not worth the risk especially since the 25 Year Guarantee has so many loopholes. Major estates like the Estate of Andy Warhol, Keith Haring, Roy Lichtenstein, Jean-Michel Basquiat, etc. do NOT provide ANY authentication, so collectors should be especially careful to NOT take unnecessary risk and purchase items that have sketchy provenance or questionable documentation.

February 26, 2015

Skate's Online Art Market Analysis Narrow, Lacks Substantiation



Actual 2014 Online Art Market Estimate by Joseph K. Levene, The Fine Art Blog
Actual 2014 Online Art Market Estimate by Joseph K. Levene, The Fine Art Blog

Skates overlooks at least $1 billion Online Art volume at eBay and Christie's

Based on recent data regarding 2014 sales released by Christie's and Auctionata, Skate's February 2015 analysis erroneously proclaims Auctionata leader of 2014 Online Art trading volume and overlooks $178 million generated by Christie's LIVE online bidders. Skate's overlooks estimates for Online Art sales volume generated by eBay and Sotheby's, yet provides estimates for artnet and Paddle8 even though published results won't be available until March.

Skate's 2014 Online Art Market Estimate
Skate's 2014 Online Art Market Estimate 

Proclaiming Auctionata leader in online art trading volume is misleading

Auctionata fails to provide specifics to support the $41 million realized in 2014. Although Skate’s Art Industry News report names Auctionata as leader in online trade volume with $41 million in gross merchandise value sold, no category or location specifics are detailed in either the Auctionata press release or Skate's.  In addition, no details show trading volume generated from auctions, online marketplace and appraisals for which Auctionata charges an exorbitant 2.38% appraisal fee if the user submits 6 or more items for evaluation.

Tyeb Mehta (Untitled) Falling Bull Purchased on Christie's LIVE or $2.8 million
Tyeb Mehta (Untitled) Falling Bull
Purchased on Christie's LIVE or $2.8 million

Why does Skates overlook the added value from Christie's LIVE

There is significant added value realized by online bidders at Christie's LIVE even if users aren't the successful bidder. Christie's realized $178 million from online bidders in addition to $35.1 million generated from 78 e-commerce sales, +54% vs. the prior year. Christie's e-commerce platform has introduced buyers from 69 countries with 32% new to Christie's and 42% of these buyers under the age of 45 years. The highest priced lot via Christie’s LIVE was Tyeb Mehta’s (Untitled) Falling Bull sold for $2.8 million in the inaugural Mumbai, India sale, December 2014.

How can Skate's forecast Paddle8 and artnet sales when results not public?

Skate’s Art Industry News report also states:
"While Paddle8 and artnet.com AG have not yet published their results, Skate’s runs a close tally of their online auctions and expects Paddle8 to report GMV of about $37-40 million for 2014, while artnet.com is unlikely to exceed $30 million GMV for 2014".
Since Paddle8 typically ends all lots simultaneously, unless Skate's has multiple personnel that carefully watch each lot, we question how Skate's determines which lots are sold vs. unsold. For instance, in the Paddle8 Perfect Match auction, 25 jewelry lots ended simultaneously at 5pm on 2/25/2015, of which 12 had one bid not meeting the reserve. Since all bids at Paddle8 are anonymous, critics question whether bids not meeting the reserve are real bids, chandelier bids or shill bids?

Paddle8 Jewelry Lots

The rules for selling art online should be no different than offline

Vendors who sell Art online should be held to the same standards as brick & mortar art sellers. Both Christie's and Sotheby's provide the same terms of guarantee whether online or off. In other words, in the event a buyer purchases a work of art incorrectly documented and/or counterfeit, for a four year period, the sale can be rescinded. The launch of Christie's e-commerce platform expands the Christie's potential buyer universe by providing a safe buying experience.

By comparison, documentation errors/omissions, Authenticity issues, incorrect condition reports and surprise shipping costs and limited return policies highlight reasons users aren't rushing to buy Art Online at Auctionata, Paddle8 and Amazon/Art. Documentation of many lots offered at Paddle8 is routinely vague/limited, often without accompanying photos, since the Paddle8 never inspects lots prior to listing and relies on the consignor for lot information.








What lots excluded by the Auctionata Guarantee?
Auctionata boasts a 25 year Guarantee
What lots are excluded by the Auctionata Guarantee?

Auctionata 2014 highlights boast 11 lots sold totaled €2 million, raising the question, show me the remaining €29 million ($33 million)!



According to Auctionata, revenue totaled €31.5 million in 2014, but how much volume traces to each Auctionata category?  Unfortunately, Auctionata fails to breakout 2014 trading volume realized by category, location and fees for appraisals, buy-ins, along with payments to its 300 Experts who receive a commission incentive should the lot be auctioned and a fixed fee for the initial appraisal based on time spent.

Convicted fraudster and former Auctionata employee Hao Ji aka Joseph Hokai Tang
Hao Ji aka Joseph Hokai Tang, former Auctionata employee convicted for fraud 
Linkedin resume of Convicted fraudster and former Auctionata employee Hao Ji aka Joseph Hokai Tang
LinkedIn profile Hao Ji aka Joseph Hokai Tang, former Auctionata employee 

Auctionata boasts a team of 300 experts, one of these so called experts was convicted of fraud and is no longer employed by Auctionata. These experts evaluate property before lots are offered at auction or in the Auctionata online store; many Auctionata lots are misleadingly and deceptively documented, often without accurate provenance and catalog raisonne details. A frequent pattern of deception at Auctionata includes repeated reference to vague/erroneous International auction results, all without links and specificity. Or erroneous reference to catalog raisonne documentation when selling an After entirely inconsistent with the respective entry; stating a work is signed even though it bears a spurious signature; inaccurately reporting condition when the photos show significant light stain or a watch is defective.

Why didn't Auctionata disclose Lesser Ury painting was sold twice at auction?

Auctionata Search results indicate 1,323 paintings sold "recently",  the highest price was $130K realized for a Lesser Ury painting.  For reference, 197 paintings sold were priced below $2,000, and the majority, 975 paintings fetched under $1,000, considerably below the target price range of $5,000-$20,000.
Why did Auctionata lot details not disclose Lesser Ury painting previously sold twice at auction?
Lesser Ury Dame im blauden kleid im cafe
Sold by Auctionata for $130,000

Disturbing is the blatant provenance omission since the Lesser Ury painting was sold twice at auction before it was offered at Auctionata; in 2009 for $92,855 and in 1995 for $87,470. Furthermore, provenance details in the December, 2014 lot description were absolutely incorrect as the painting was not in the same Private Collection since 1997.

Why was the Auctionata Expert unable to provide accurate auction provenance history? It took this user less that 3 minutes to locate the painting's auction history. The Auctionata buyer paid $130,000 for this Lesser Fry painting and was misled, exacerbated by  A Rediscovery, an Auctionata Blog Article,  even though the Ury was sold and "discovered" in a 2009 auction, realizing nearly the same price fetched 14 years earlier! In addition to getting an initial fee covering time spent, each freelance Auctionata Expert receives a pro-rata commission of the highest bid for the respective lot, so skewing the results, and/or omitting certain facts is beneficial.

The Auctionata Lot for the Lesser Fry sold in December, 2014, includes the following erroneous documentation concealing two prior auction results and for some reason, suggests comparable Cafe Scene paintings sell for twice what the very same painting actually sold for at auction.
"Lesser Ury is known and appreciated for his street scenes and coffee house images in impressionist style, the interior scene presented here shows one of the coffee houses on Berlin's boulevard  band is arguably one of his finest examples of a café scene; comparable subjects fetch up to €180,000 on the international auction market."
What is the reason for this overt deception? We doubt there is a system in place to review documentation by Auctionata Experts as we have identified numerous instances of published/sold lots with multiple errors, i.e., counterfeits, condition errors, provenance errors, etc., modified facts and empty references to International auction results without specifics; that is no links, dates, photographs, etc., and most documented with inflated fantasy results like the Fry.   
Lesser Fry Painting sold for $92,855, December, 2009 NOT disclosed by Auctionata
Lesser Fry Painting sold for $92,855, December, 2009
Ironically, Auctionata states every work comes with a story, and in the case of so many works at Auctionata, it is a story that begins with deception and ends with omission. Why did the Auctionata expert not disclose Lesser Ury painting sold at least twice at auction? And bizarrely state comparable subjects fetch up to €180,000 on the International auction market?

The majority of lots offered for sale on Auctionata lack documentation clarity and include either vague support or no support. Too often lots sold exclude obvious information like date of sale; sale number; lot number; vague references to comparable sales results, lacking specificity/accuracy, many without links that art professionals and collectors understand and require.



Why does Alexander Zacke, CEO Auctionata, say art is a stable and safe investment?
Alexander Zacke, CEO and Founder, Auctionata

5 Auctionata Myths:

    MYTH 1. Art is not only a stable, but also a safe, investment. By safe I mean that afterwords, the item has appreciated in value. Art is therefore a long-term, stable and safe investment states Alexander Zacke, CEO and Auctionata founder.
    Unless Mr. Zacke has a crystal ball, it is irresponsible and unethical to guarantee that art is a stable and safe investment, especially since the majority of art sold on Auctionata would not be considered collectible by knowledgeable art professionals and collectors. For a considered analysis on this topic, read Art as an Investment? A Survey of Comparative Assets by Melanie Gerlis.
    MYTH 2. Auctionata strives to meet the demand for a trusted online auction space that protects both the seller and the buyer from fraud states Ben Hartley, International Managing Director Auctionata, and formerly President, Louise Blouin Media. Most of the so called "afters" sold by Auctionata are actually counterfeits no reputable auction house and/or art dealer would consider offering for sale, none considered safe. Most of the "afters" sold by Auctionata, shown below, include erroneous, vague reference to comparable auction results, most without links.
     131 "After" Lots sold by Auctionata NOT covered by Auctionata Guarantee, most counterfeit
     131 "After" Lots NOT covered by Auctionata Guarantee
Counterfeit After Andy Warhol sold by Auctionata with erroneous signature
Counterfeit After Andy Warhol sold by Auctionata with erroneous signature 
    MYTH 3. Most items sell in our auctions between $5,000 to $20,000 states Ben Hartley, International Managing Director. During 2014, Auctionata ONLY sold 193 lots priced between $5,000 to $20,000, out of a universe of 8,255 lots sold in Germany and New York, translating to just 2.3% of total lots sold. Regarding New York sales, based on the limited Search available, Auctionata sold 34 lots during 2014, of which 6 were priced between $5,000 to $20,000. 
    Most surprising, Auctionata sold 1,840 lots priced under $50, representing 22% of ALL lots sold in 2014, contrary to its 2/15 press release stating there is a "demand in the mid-market range for art and luxury collectibles that is not being met." In our judgment, every $50 lot sold by Auctionata has an incremental administrative cost of at least $125 per lot; to avoid unnecessary financial ruin, it behooves Auctionalta to cease selling so many low end lots under $150-$250, which will never be profitable even with almost 50% commission rate from buyer and seller. After all, Auctionata is building auction studios around the world; has a team of over 300 employees and 300 experts, etc. 
    Full disclosure, the Auctionata Search, does not include a way to search with a custom date range; accordingly,"recently sold" was used to generate 2014 sold items.
    MYTH 4. Our specialists vet and evaluate every piece sold at Auctionata.com and all purchases come with a 25 year guarantee.
    10.5 Auctionata Terms of Guarantee exclusion:  If an item’s catalogue description explicitly includes a caveat or restriction regarding the reliability of the information provided, then said information will not form part of the agreed characteristics. In this case, the purchaser will purchase the item at his own risk as far as the information in question is concerned. If a catalogue description explicitly refers to an item as a “copy” (e.g. as a “museum copy”), then the item in question will be deemed purchased as a copy and not as an original, thereby precluding any warranty for defects in this regard. If the catalogue description explicitly describes or designates an item as being "of doubtful authenticity", then said item will be deemed purchased not as an original but as an “item of doubtful authenticity”, thereby precluding any warranty in this regard. Inasmuch, neither the starting auction price nor the final hammer price of an item can be used to draw inferences about the actual characteristics or authenticity of that item.
Section 10.5 from the Auctionata Guarantee excludes Works designated as an "after", reproduction and/or copy; at least 131 Prints sold by Auctionata during 2014 are not covered by the  Auctionata guarantee.
MYTH 5. It is inexpensive to sell your lots on Auctionata and getting valuations is free. The Auctionata website states "There are many advantages to selling on Auctionata that you simply won't find anywhere else. We provide access to an extensive network of International experts who will value your property."
Auctionata consignors face excessive selling fees that are hardly competitive and not user friendly. Consignors should think two, three or four times before agreeing to a consignment since you can count on paying a 20% selling commission for all sold lots, either online or via its online marketplace; 2% storage fee if unsold lots are not picked up within 14 days; possible 2.5% insurance fee; shipping & handling fees; photography fees and incredibly, an appraisal fee of 2.38% + €119 if you want an appraisal of 10 or more items. 
Factor in buyers fee and most lots have a commission rate yielding Auctionata a commission of 45%-50%. And don't even think about paying late which means that unless payment is received within 7 days, you are faced with 16% per annum late charge. Have second thoughts about an Auctionata consignment and face 25% penalty of the mean estimate for each consigned item removed.
The moral is proceed with caution before you sign an Auctionata consignment contract.

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