(A Transcribed Interview with The Founder And Owner Of Auction Report, Ryan Friedman. Conducted By David Seideman, Collectable’s Senior Editor.) CollectableU aims to educate, inform, and entertain sports collectors and investors with relevant information on investing in this burgeoning asset class.
David: Ryan, welcome to CollectableU. It’s exciting to have you because I read Auction Report religiously to stay on top of all the auctions going on. Can you please give our readers an overview on why and when you decided to start the publication?
Ryan: When I launched Auction Report back in 2005, I wanted to bring an auction focused news site where collectors can easily and simply access the information on the auction companies (free of charge for collectors) and to produce something that allowed the auction companies to have a single source to promote all that they had going on such as auction and consignment information.
So, in 2004, after spending the previous 8 years full-time in the sports memorabilia auction business including owning my own auction company, I realized that there was a certain void of information on the auction industry for collectors and auction companies to utilize. I decided to shift my focus and I was able launch Auction Report the following year.
From the start of an auction to the end of an auction and everything before, during and after, Auction Report provides an abundance of information on a daily basis to collectors on AuctionReport.com. I believe that Auction Report is the best choice that collectors can make to insure they are current with all the auction news and information.
Since the very first day I launched Auction Report, the goal has remained the same. And now, after 16 years and currently covering 48 auction companies and having over 20,000 people on our e-mail newsletter list, we are still achieving this goal and growing each year.
Question: These days there are so many auctions going at once, it’s hard to keep up. Your guide is a huge help. How often does it appear? How do you stay current?
Answer: I try and keep the auction calendar up to date as often as new dates are known to me (updates happen all the time). We have multiple calendars on Auction Report to help everyone keep track. There is a calendar on the right-side column of all the pages on AuctionReport.com that lists auctions in progress or coming up. We also have a yearly auction calendar that includes consignment deadlines for each at https://www.auctionreport.com/auction-schedule/ . These calendars also list the daily and weekly auctions that are going on as well. Plus our free e-mail newsletter (https://www.auctionreport.com/get-the-latest-news-right-in-your-inbox-free-e-mail-newsletter/ which goes out 2 times per week, features a great current auction calendar as well. Sign up for the free newsletter, it the best way to keep track of everything!
David: The sports collectibles industry is booming, and the auction industry is having a banner year. Any ballpark estimates in terms of the combined total sales? Why do you think it’s so bullish?
Ryan: If you’re going to include all categories of sports collectibles, memorabilia, and sports cards, you’re in the billions. By itself, eBay will facilitate over a billion in sales this year. And when you include your more traditional auction companies that we cover on Auction Report, it will be in the multiple billions this year.
David: One thing I wonder is how all these houses keep maintaining fresh inventory.
Ryan: I am always amazed by the fresh inventory that comes to auction. The fact is that it is not easy for the auctions to obtain. These companies put a lot of work, money, marketing, time, and research into it. Sports have been around for a long time, and they aren’t going anywhere, so fresh material is still out there and will be in the future. Finding it and getting it to auction is the hard part.
Question: What are some time tips you have for buyers? For example, do most set a target price and account for the typical 20 percent commission? Do they exceed their targets in the heat of the moment?
Answer: Do not bid emotionally! Unfortunately, we all seem to fall into this at some point on a piece or too. I know I have! Setting a price point (and factoring the buyer’s premium) you are willing to bid up to, before the auction starts is always a good way to go into an auction prior to bidding. Do your research on the piece(s) you are thinking of bidding on; look at past results, market trends. Know if you are bidding to collect and hold a piece because you are having fun or if you are bidding to sell it short or long term. I also think placing an initial bid early is smart, you can always come back to it later and this allows you to continue to bid in extended bidding which can give you more time to research. Finally, some of the auctions can go late into the evening or early morning hours; use the max bid (auto-bid) features. You don’t want to fall asleep and miss out on getting something you want!
David: I’ve found that consignors can negotiate the customary 10 percent commission down to five percent or even zero. Should consignors try?
Ryan: It never hurts to ask. Worst case, they will say that cannot lower it. All the auction houses on Auction Report are more than happy to explain their consignment rates and why they charge what they do. Most of the time, the lower consignment rate applies to higher valued items.
David: What should consignors look for in an auction house?
Ryan: Every consignor is unique and the items they have are going to differ, so the answer will very a lot for each person, but there are some overall things that I believe would help a consignor choose the right auction company to work with. First, make sure they are a reputable company that we cover on Auction Report! Be comfortable and understand the entire consignment process with the auction house you are dealing with (including how items are sent in, understand setting a minimum bid, the consignment rate, payment terms, and authentication or grading process. Be sure to read over all the consignment paperwork). Also, does the auction house specialize in the type of items you are interested in consigning? Many of the auction houses do have certain items, they get better results on than others. And finally, sometimes you must choose what type of auction format you want your items in. Some are weekly, some are monthly, some are premier auctions that items are featured in a printed catalog. And some are only internet based. Some auctions feature 1000s of items and some feature only a few hundred at a time. Every consignor must figure out what will work best for them.
We also offer a free service at AuctionReport.com where you can fill out your consignments and we will send your information to all the auctions we cover and those auction houses that are interested in your items will contact you. This way, people do not have to call or e-mail 45+ companies! Go to https://www.auctionreport.com/consignsell/
David: What are some of the pros and cons of selling in auctions? For example, one downside is that you have to wait longer to be paid.
Answer: Auctions have been and always will be the best way to sell items. Usually, at the end of the day, you are going to get fair market value or more for your item. When you study the results of auctions going far back, it’s usually look like a little bit of a roller coaster in prices realized. Most items go for what you thought they would, some go for a little less and some go for a lot more than you ever expected. At the end of the day, just the timing of the auction can be the deciding factor. That is the beauty auctions. I think the overall exposure to potential buyers is the main pro to selling via an auction. The auction houses have thousands of clients looking for the items they list at auction. Also, it usually gives the seller the comfort of knowing that multiple people in essence were interested in the item and bid it to the max level they were willing to pay. When you do a straight sale, sellers are always like, could I have gotten more or am I asking too much for my piece? Waiting longer to be paid, might be considered a downside, but today, the auction companies offer so many lengths of auctions (daily, weekly, monthly, 15 days, etc.) that getting paid out in a certain time, usually is not a big factor for the consignor they can choose an auction that fits their needs. Also, there are ways to obtain cash advances on certain consignments that can help a consignor with cash flow if needed.
David: There’s been a lot of buzz about fractional ownership like Collectable lately? How big a role in the industry do you see fractional ownership playing in coming years?
Ryan: Based on its short history so far, I think it will be a smaller niche within the overall collectible industry five to ten years down the line. But a small niche could still mean tens or hundreds of millions of dollars in sales. I believe that auctions are and will always be the dominant percentage of sales in both dollars and number of pieces sold. Probably, 60% to 80% of the overall industry.
But if the fractional share market takes 10% of the industry sales down the line, those are going to add up to huge numbers and will bring in a lot of new collectors to the industry.
The fact that fractional share companies are attracting new people to the sports card and memorabilia industry is great. I believe anything that brings in new blood helps the entire industry, and you will see a lot of crossover of fractional share buyers/sellers becoming auction buyers/sellers too.
David: What’s the appeal of NFTs? (NFTs, or nonfungible tokens, are assets that delegate ownership of a virtual item like a picture, tweet or video, typically paid for in ethereum cryptocurrency. The asset can only be held by one person at a time, and ownership is recorded on a digital ledger that underpins cryptocurrencies like Bitcoin.)
Do you think they will be around for the long haul? Why or why not?
Ryan: My gut says the technology of NFT’s will be here forever and there are great practical uses for it for tracking items, that is for ledger purposes. But from a collectible standpoint, it is NOT high on my list to invest in (I’ve never bought or sold NFT’s). It is kind of like day-trading to me, you need to be on your game all the time and you can make a lot or lose a lot. At this point in my life, I’m considered a little bit old school in the fact that I like to collect tangible assets for the most part. It’s still the wild-wild west for NFTs, I’ll sit on the sidelines for this one.
Question: You’ve preached the importance of authentication. Of course, almost all investors buy graded cards. Any advice about autographs and game used memorabilia?
Ryan: When it comes to autographs, using companies like PSA/DNA, Beckett and JSA for authentication is the way to go. All the major auction houses use one or all these companies for their autographs. For game used material, it gets a little trickier. Research, research, and more research is what I recommend to everyone before buying game used items. Tracing the history of a game used piece or provenance is extremely important. How did it go from the player to the seller is key. There are some photo-matching companies as well that can help in the authentication process too, but I like there to be multiple factors of authentication when it comes to game worn items.
The other option is that the leagues themselves auction off a lot of game used items too, so the authenticity is pretty much iron clad at that point. At the end of the day, if the price is too good to be true, then you may want to think twice before buying.
David: Finally, as one of the most veteran Michael Jordan buyers and sellers do you think the sky is the limit?
I’m in Chicago and have been buying and selling in the Jordan market longer than I have been in the auction business. Fortunately, to have lived in Chicago I have handled so many game worn jerseys, contracts, and other unbelievable pieces from the Bulls team over the years. When you are collecting the GOAT it never goes out of style. People talk about the Last Dance bringing attention to him. But there’s a whole YouTube generation in their early 20s and 30s. Michael Jordan has sparked interest, comparing highlights to Lebron. You also need to know that in October 2019 Upper Deck Authenticated tripled its pricing [signed non game-used jerseys sell for as much as $17,499.99]. The massive jump started before Last Dance. It’s crazy! A lot of the buying from Upper Deck is full, full, full retail like buying at airport stores.
Meanwhile his game-used, higher end memorabilia with ironclad provenance that you can trace straight from a team or Jordan’s foundation has always been underrated. I have brokered between five and ten jerseys. Just think about it. If you add up all the population of all his game-used jerseys, it’s a third of his PSA 10 rookie cards, which is over 300. Every year, Jordan was issued two homers and two roads. I don’t include his Wizards jerseys. So, if you track 13 years with he Bulls through the ’97-’98 season, that’s 52 jerseys. A Jordan gamer generally sells between $300,000 and $400,000. It could be worth more than $1 million. I’m shocked how high the rookie PSA 10 Jordan has gone. I’m not surprised it got to the $150,000 to $300,000 level, but everything over that, continues to surprise me. How could that be worth more? [In February, two PSA10 Jordans fetched a reecord-setting $738,000 due to their perceived superior “eye appeal.”)
David: So the future is bright for Jordan?
Ryan: There are millions of people who love Jordan and probably 10,000 people who can afford his rookie card. There is not enough supply to meet the demand. And there are a lot of people holding five or ten Jordans. But I still don’t think it’s sustainable. I have been shocked every time his rookie has sold between $300,000 and $400,000. But parents with younger kids ask ‘who did my parents watch.’ A whole generation of basketball card collectors are nostalgic.
If you want to buy his rookie cards, the 9s, 8s, 7s, and 6s, are more affordable but slower movers over time.
David: What other Jordan memorabilia do you think is with investing in?
Ryan: I believe that Michael Jordan memorabilia such as game worn shoes, rare autographs, rare memorabilia, and original photos are still way undervalued and have great growth potential.
I’ve been a big buyer of Type 1 original Jordan photos, particularly from his rookie year and historic games. A few years ago, they were selling for $100. Now they can be over $10,000. Each photo is one of one and PSA slabs them. I’ve been buying and selling these for decades as a fan. You can go from the 8x10s to the smaller photos. Many are undervalued and just spectacular.