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MACDOUGALL’S
OF LONDON
THIS YOUNG LONDON-BASED AUCTION HOUSE SPECIALIZING
IN RUSSIAN ART HAS TAKEN ON THE BIG PLAYERS, AND WON
Robert Falk Woman in Red 1932
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“The best investment I ever made,” is how William
MacDougall describes the auction house that bears
his and his wife’s name. William and Catherine opened
MacDougall’s in November 2004, and in just six years
their specialized Russian art sales rose from zero to
market-leader. MacDougall’s has overtaken Christie’s,
Sotheby’s and Bonhams for Russian art business, and
in 2010 the rap of the gavel brought them sales of
£25 million. Theirs is one of the few major auction
houses in the world to specialize in Russian art, and
it is recognized as the market leader for post-war and
contemporary Russian art.
We just did it as a labour of love,
and it looked a lot easier than
it actually was
At the start it wasn’t so easy. “We didn’t have a very
clear idea of what it involved,” explains Catherine. “We
just did it as a labour of love, and it looked a lot easier
[to do] than it actually was.” Catherine believes that
their first sale was too far ahead of the market. “Our
first auction was a complete disaster. We lost some
money and we didn’t sell much. It was quite early to
do a focused sale of Russian émigré art. At that point,
nobody wanted these artists.” They believed in what
they were trying to achieve, though, and persevered.
“We tried again, adjusted the collection, and it
all worked out.” William attributes their success to “understanding the buyers and the sellers.” That remark
illustrates the particular skills that the couple bring to
the table: his on the business side of the operation and
hers in understanding the art and the clients.
What the couple share is their passion for collecting
Russian art, and their blend of knowledge is a
winning combination. Russian art has unquestionably
been a high-performance investment over the past
10 years. The market has enjoyed an 800 percent
growth in value.
Does William expect another 800 percent rise in the
next 10 years? He smiles, saying, “Investing in Russian
art is investing in Russian millionaires.” The Russian
economy will make a lot more millionaires while
it catches up from the Soviet years, and those
Catherine and William MacDougall
millionaires will likely be eager buyers of Russian
art. “For eighty years, the flow of art was out. Now
it’s coming back.” Exiles took as much of their best
art with them as they could, the Russian state sold
art quietly, and, of course, Russian artists who
escaped the country carried on working.
Exiles, émigrés and businessmen are now beginning to bring their heritage back home. The new
Russian and Ukrainian elites are patriotic and
proud of their cultures. Investors like Abramovic,
Lebedev and Pinchuk hang their purchases
on the walls of their homes, rather than locking
them away in dark bank vaults. They are bringing
home their history, with a little help from
the MacDougalls.
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Another part of the company’s magic is its staff,
most of whom are native Russian speakers.
Emphasis is placed on the subtleties of the social
element in the business; at every MacDougall’s
auction, Catherine welcomes established and new
clients at a table with refreshments. That’s a part
of the couple’s understanding of their buyers, now
and when they began.
Investing in Russian art is investing
in Russian millionaires
“People wanted personal attention,” explains
Catherine. “All the collectors were the same age
as us, and had only been collecting for a few years,
so we got on well. Collecting Russian art meant
that we had a lot of contacts and connections
among dealers and collectors. It’s very pleasurable to deal with paintings – most collectors
become much more relaxed when they talk about
the art; they become much easier to be with, much
more jolly. For them it’s nicely spent time. So we
tend to spend our spare time with our clients, and
we become friends.”
This can lead to much longer hours than a normal
working day. “If you enjoy what you’re doing, it’s
not a problem. We don’t stop talking about work,
especially as we’re still collectors ourselves.” Personal relationships like these are important.
The MacDougalls reject 70 percent of the artworks that are
offered to them. William says that it’s not because there are more
fakes in Russian art, but because values have risen so much in
the past 10 years. “You don’t do a $3,000 pigment analysis on
a painting worth $10,000.” If the painting could now be worth
$1million, then it would merit much closer investigation. Rejected
pieces often show up in sales in locations where the protection for
buyers is not so strong.
He dismisses the Russian reputation for corruption and fraud as
overblown. “You can have problems anywhere. In any case, we
don’t have problems because we are a British company trading in
London.” Over 90 percent of Russian art is bought by Russians and
Ukrainians, and London has the lion’s share of this market. Collectors buy in London because the city has strong protection for
buyers and also because from London the art can go to any of
their homes around the world, even Moscow, without being constrained. In 2010, two Russian Art Weeks netted £70 million in sales.
Now, the market in Russian art is developing towards maturity.
Catherine says, “The prices had been slowly rising from the late
1990s. It was really undervalued when we started collecting, but
then some very important collections started to form, and the
prices of the pieces started to rise. Gradually, Russians became so
confident in their status and wealth, that they now think they’re
giving you a favour if they buy. So personal attention is important,
and they want you to adjust to their attitude. And they’re not prepared to adjust to anyone else’s. Russians, at a certain level, expect
you to take their phone calls late at night or early in the morning.
That change of psychology was very helpful for our business.”
Being younger, savvier and more attentive than the established
auction houses was key to the MacDougalls’ success.
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Boris Kustodiev Portrait of Irina Kustodieva 1911
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Boris Kustodiev Merchant’s Wife
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Being able to understand the collectors, their
attitudes and their needs came from Catherine’s
and William’s own experiences of buying and
collecting, which is basically how the business
came about. Catherine talks of the time,
back in May 2004, when she and William were
commiserating over sushi after a particularly bad
experience at a London auction. William was a
bond manager and she was an equity analyst.
They decided that they could do the job better.
“We thought: ‘Why not create an ideal auction
house, one where we would be happy to be?’”
William says, “We collected Russian art, selling to
buy and balance our portfolio” and so the couple
knew how crucial it was for the authenticity of the
pieces on sale to be assured. “We were the first to
say that Russian art should be sold in collaboration
with the top experts in Russia,” explains Catherine.
MacDougall’s has consultants in Moscow and Kiev,
as well as in London. “We don’t have local offices.
Local offices have generalists. All our assessments
are made by experts.” They also make extensive
use of the internet, which allows them to make
decisions on paintings from anywhere in the world.
“And because we own the company, Catherine
can decide immediately,” says William.
The couple’s savvy earned the firm an early break.
“We got our first big consignment through the
internet. We received an email with some photos
of pictures by ‘Corvin’ from a portfolio.” The email
was from was the heir to the collection
of Theodore Kosloff, a dancer with the Russian
Seasons ballet corps in Paris, who later became
a star of the silent movies in Hollywood. The
“Corvin” was a Korovin. “Many of the Russian
artists’ names on the list were spelled incorrectly,
and so the other auction houses didn’t understand
what they were dealing with,” says Catherine.
Snapping it up, MacDougall’s sold the Konstantine
Korovin painting for $700,000.
William and Catherine live their life and work
surrounded by masterpieces and icons. They
divide their time between London and Russia, with
pride of place being their country home in Russia.
“Our dacha was built at the end of the 19th
century – a classic wooden ‘Chekov’ Art Deco
dacha. It’s beautiful,” says Catherine. There are
clear divisions of labour: the husband does the
cooking and the wife does the renovation.
People are certainly investing
in top-quality paintings
The couple were almost predestined to meet.
“William’s grandfather and my great-grandfather
were neighbours. I grew up with William’s cousin,
and that’s how we met.” William is a Canadian,
with Scottish ancestry and one-quarter Russian
blood; his grandfather was a concert master at
the Bolshoi Theatre. Catherine was born in
Moscow. “William proposed within 24 hours of our
meeting. I said ‘No’. Five or seven days later we ran
into each other on the streets of Moscow – which
was a huge coincidence. We both thought it was
a sign, so I reconsidered.”
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The MacDougalls dacha
And working with her husband? “It’s an absolute
nightmare,” she laughs. “Working together has a lot
of advantages and a lot of disadvantages. A big disadvantage is that we tend to talk about business too
much.” As well as her work with the auction house,
Catherine is finishing a novel. “It’s a Russian art thriller,
with oligarchs and fakes, about a start-up auctioneer, and her first auction, and Russian fakes – it’s what
I really know best. When a novel is written by a professional, the reader has a chance to learn a lot more
detail about the industry. There are quite a lot of
novels about the art industry, but very few people
know what they’re talking about.”
If you can do something in your life
that you really like, you’re very lucky
William is pleased to be working with the art that he
is so passionate about. “Not everyone can do what
they love,” he says. Catherine echoes the thought. “If
you can do something in your life that you really like,
you’re very lucky. And if you get paid for it, that’s happiness.” She remains practical in her business outlook,
though. “People say I’m the Iron Lady of the Russian
art business. It’s a difficult combination. On the one
hand, you’re always trying to be objective – there are
markets, there are prices, there are different tastes
and trends – and on the other hand, it’s much easier
to sell something you really like and love.”
Especially if that involves quality. “The first crisis
showed that the prices for unique works went up dramatically. People want the best. [They] pay huge premiums for high-quality works, and the top segment
of the market is very active,” she says. Although the
main competition right now for Russian buyers is in
the Impressionist market, the most dependable buy
in all sections remains that of the highest quality. “It’s
easier to sell a half-a-million dollar work than a
$50,000 work at the moment. People are certainly
investing in top-quality paintings”
.
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Ivan Shiskin The Pine Forest 1895