Selling to the Rich for Fun and Profit

You can find this week’s TL;DR here.

Key Lessons:

• Get in proximity to wealth.

• Ask for an introduction.

• Be where the action is.

• Sell to the wealthy.

• Be larger than life.

• Make cold calls.

• Be direct.

Last week on Methods of Prosperity

In 1981, art dealer Larry Gagosian bought three works of art at a group show. They were pieces from Jean-Michel Basquiatat. This led to Basquiat’s first exhibition in Los Angeles. Basquiat and his then-girlfriend, Madonna, stayed with Gagosian at his Venice home.

Larry Gagosian was born in 1945 in L.A. to Armenian parents. He had a rocky start. He struggled with a lack of direction in his early years. This era included a brief marriage, various odd jobs, and legal issues related to forgery.

His career pivot began when he noticed a street vendor selling posters. Which inspired him to start selling framed posters for profit on Broxton Avenue. This evolved into a more formal gallery space.

He had financial struggles but figured it out. He’s a fast learner, and a natural. It was an unorthodox entry into the art world.

Gagosian’s ambition grew. He realized the commercial potential of art. Gagosian would become a powerful figure in the art industry. His early business involved celebrities like Steve Martin and musicians like Kim Gordon.

It was only the beginning of his influential career. He was about to meet a legendary art dealer who would change the course of his life.

Part 98. Larry Gagosian (conclusion)

Los Angeles, late 1970s. Ralph Gibson was a photographer represented by Leo Castelli in New York. Larry Gagosian at that time was a young dealer based in Los Angeles. He cold-called Ralph Gibson to propose a show. Gibson would do it under one condition. Gagosian promised to buy three or four of Ralph Gibson’s photographs as a guarantee. Gagosian flew to New York with a check. Gagosian arrived at Gibson’s studio on West Broadway in New York. That’s when Gibson introduced him to Castelli.

This introduction proved pivotal. Castelli was a legendary dealer. Leo Castelli represented at least several dozen of the most famous artists of his era. His influence extended to every major figure in postwar American art. Including many of the most influential names in modern and contemporary art. Particularly in movements such as Pop, Minimalism, and Conceptual Art.

Jasper Johns, Robert Rauschenberg, Roy Lichtenstein, Andy Warhol, Frank Stella, Donald Judd. The list continues with James Rosenquist, Cy Twombly, Dan Flavin, and Bruce Nauman. Not to mention Robert Morris, Joseph Kosuth, Keith Sonnier, and Claes Oldenburg.

Castelli worked with or exhibited works by Jackson Pollock, Lee Krasner, and Max Ernst. As well as a certain surrealist named Salvador Dalí. Cy Twombly would become close friends with Larry Gagosian later in life.

It was Larry’s first trip to New York when he met Leo Castelli at Ralph Gibson’s studio on West Broadway. Castelli realized Gagosian could be effective. He gave him access to his inventory and his artists’ studios. Lichtenstein, Jasper Johns’ studio. He introduced Larry to Andy Warhol. He introduced Larry to Jean Michel Basquiat, who ended up living with Larry in Venice Beach.

Leo was important. By association, Larry became important. Leo gave him credibility. Larry most likely would not have had that without Leo. Larry observed the way he did business. Unlike Larry Gagosian, Leo Castelli was very European. He wore tailored suits. Which was never Larry’s style. But they became good friends.

Castelli became a mentor to Gagosian. He offered guidance and connections. Connections which helped Gagosian establish himself in the New York art world. Their relationship deepened over the years. They partnered on a joint gallery at 65 Thompson Street in SoHo in the late 1980s.

It was 1979–1980. Larry Gagosian was in his early 30s when his career as an art dealer took off. He became opportunistic, selling paintings out of his loft on West Broadway. Until the property management protested at the heightened traffic and parties. It was a residential building. It wasn’t a gallery building. But it was across the street from Leo Castelli. It was a great position to have.

At the time, Larry was still based in Los Angeles. He moved to New York in 1985 to 1986. That’s when he opened his gallery in Chelsea, on 23rd Street. Most of the NYC galleries were either uptown around West 57th Street, or downtown in Soho. His Chelsea gallery is a 10 story building on 23rd Street off 10th Avenue. The ground floor was a dock for trucks to load in. The owner of the building rented it to Larry for $3,000 per month.

Larry Gagosian denies having any intention of having a gallery in New York. He knew he had to spend some money to make the ground floor look like an art gallery. In those days, he could rent a space like that on a handshake. The owner didn’t make him fill out a ton of paperwork. Larry made the space into an attractive art gallery. His first show at his Chelsea gallery was the Pop art collection of Burton and Emily Tremaine. They were a prominent Connecticut-based couple. The exhibition included significant pieces such as Robert Rauschenberg’s work. Gagosian sold one during the show.

Gagosian met Charles Saatchi, an Iraqi-British businessman. He’s the co-founder of Saatchi and Saatchi, and a prominent art collector. He owns Saatchi gallery. Have you heard of the Young British Artists (YBAs)? They’re a collective of artists which includes Damien Hirst and Tracey Emin. Saatchi sponsored them. Saatchi and Gagosian met each other at one of Gagosian’s loft parties in 1979. They became good friends.

Leo Castelli introduced Larry Gagosian to Si Newhouse. Newhouse was an American heir to a substantial magazine and media business. Which included Condé Nast. In 1975, Newhouse took over as chairman of Condé Nast. Leo and Larry were walking across West Broadway to Mary Boone’s gallery. Leo stopped in the middle of the street and shakes hands with this guy who looked like a plumber or carpenter. He was a very low key rich guy. He didn’t look like an impressive art collector. Larry asked Leo who that was. Leo informed Larry, “That’s Si Newhouse. He can afford to buy any painting he wants.”

“Would you introduce me to him?” Larry insisted. “Sure,” Leo Castelli replied. So, in the middle of the street, Larry demanded of Si, “Give me your phone number.” Si gave Larry his phone number and Larry called the next day. Si was living on 70th Street. Larry did a lot of business with him. A lot. He was a big client of Larry Gagosian’s.

Somebody wants a certain painting. Larry finds it. Giacometti, Mondrian, Pollock. He understands the assignment. He knows where all the paintings are. Larry is aggressive. While Castelli went after the primary market, Gagosian went after the secondary market. Castelli guided the careers of living artists. Castelli sold their new work in exchange for a commission.

Gagosian brokers off-market deals. Legend has it that he invites himself to parties and takes inventory. The next day, he calls the host with an offer for a painting in their house. He matches buyers and sellers, making a premium. For instance, he knows someone who will pay $2 million for a painting and he sells it for $3 million, keeping the $1 million. Making a profit off of the discreet status anxiety of the buyer who already has everything.

Some art critics describe Larry as a collectors’ dealer. Larry disagrees. He says he spends a lot of time going to artists’ studios and gets along well with them. He goes to Joe Bradley’s studio. Joe Bradley is an American painter. He’s known for his minimalist and color field paintings. Larry poached him from another art dealer named Gavin Brown.

Gagosian is dubious of art dealers who refer to themselves as gallerists. Like David Zwirner. He regards that label as a pretentious euphemism. It obscures the mercantile essence of the occupation. Gagosian calls himself a dealer without apology.

Larry Gagosian transformed the art gallery model. He expanded it from a local or regional enterprise into a global network. Today, there are 18 galleries around the world. Including locations in New York, London, Paris, and Hong Kong. There are 19 to be exact. He closed one location at 976 Madison Avenue, New York.

He commands more exhibition space than most museums. This international presence allows him to stage simultaneous openings. Gagosian can reach collectors and audiences across continents. The scale of his exhibitions has changed the game of art sales. Gagosian generates more than a billion dollars in annual revenue. He may well be the biggest art dealer in the history of the world.

Leo Castelli was Larry Gagosian’s direct mentor. But 40 years before him, there was a master art dealer. It was a British art dealer who dominated the early 20th-century art market. Before you assume that Gagosian is on another level, remember success leaves clues. His prowess as a mega art dealer has a blueprint. Next week, we’ll study the master. He’s the leading supplier of Old Masters to collectors like Henry Clay Frick, J.P. Morgan, and Andrew Mellon.

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– Sean Allen Fenn

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