– Why did you become interested in Russia and Russian culture? Why did you decide to do business with Russia?
– My grandfather was Russian. He emigrated from Russia after the Civil War. His father, my great-grandfather, was an officer in the White Army. And my wife is Russian, from Moscow. We both worked in the City of London, and in the 1990s we started collecting Russian art.
– What shaped your perception of Russia?
– First of all, the destiny of my grandfather and great-grandfather. And then there was a staggering first visit to Russia, almost thirty years later, when we found our relatives. I met my wife here, my son was born here... So many remarkable events and memories! It's difficult to express in words how close I feel to the place spiritually.
– How does your business operate, what do you do personally?
– My usual focus is the commercial side of things, whereas my wife is more occupied with the artistic angle. The key technology is the internet: without it nothing would have come about. The traditional model of an auction business is to maintain a large building in the centre of London with a gaggle of experts. Thanks to the internet, we can quickly send out photographs of works to Russian art experts: our office is not large but we have the best experts in the world. And in exactly the same way, clients can send us photographs from wherever they are, so regional offices don't play any special role.
Established in 2004, the auction house MacDougall's is the only one to specialise exclusively in Russian art. Trading is carried out twice a year, in summer and autumn, as part of London's Russian Week. MacDougall's is the first international auction house with representation in Moscow, and, so far, the only one with representation in Kiev. MacDougall's regularly exhibits works for sale by such distinguished artists as Boris Kustodiev, Ivan Shishkin, Nicholas Roerich, Ilya Repin, Ivan Aivazovsky, and many more. Special auctions of Russian icons also take place. The auction house devotes special attention to contemporary Russian art as well, regularly arranging art exhibitions in Moscow and Kiev.
– What does it take to establish a successful auction house?
– Luck and coordinated activity. But to start such a project now wouldn't be easy.
– Why, what has changed?
– When we started out, Bonham's and Philips didn't auction Russian art. We felt there was still room for us. Now, any newcomer would come up against much stiffer competition.
– When did you start?
– In 2004. We decided to use the experience we had as collectors. The company grew rapidly and is now amongst the top three in the world on the Russian art market.
– How do you find the paintings?
– Many of the paintings find us. Sellers see our company on the internet and send us photographs. The remainder we acquire through our network of potential clients.
– How do you know that a particular painting will sell? How do you choose the paintings?
– We discuss each work with Russian experts. We know the market well.
– What is your formula for success?
– To find a good market niche, research it, and service it properly.
– Why is the trading carried out in London?
– London is the centre of the world for the Russian art auction market, and that goes for French and Italian art too. Two thirds of the world's sales of Russian artworks take place in London, much more than in Moscow or Kiev. 60 years ago, the world centre for the auction market was Paris, but due to overly strict regulation, difficulties with the language, and a whole host of other factors, Paris was squeezed out by London and New York. And London is beating New York in the Russian sector. For instance, the auction house Sotheby's ceased dealing in Russian art in New York. The flight from Moscow to London is shorter than to New York, a British visa is easier to obtain than an American one, and many wealthy Russians visit London regularly: they have flats and houses there.
– What condition is the market in? Is it in crisis?
– The financial crisis hit the market hard in November 2008, but since 2009, the market has been recovering. At the moment, the best prospects of all are for Socialist Realism and contemporary Russian art.
– Why is that? Do people pay more for artworks from these schools?
– Not at the moment, but it is thought that prices for them will catch up with those for classical Russian art.
– How many paintings are exhibited at one auction?
– Do they all sell?
– Not all of them. Sellers, as a rule, are extremely demanding when it comes to the minimum price at which they are prepared to part with their works.
– Are you able to say what what your profits are?
– We are a private company, therefore we don't announce our profits in public. What I can say is that, starting from our second auction in May 2005, all auctions have made a profit. In 2008, we earned more than Sotheby's and Christies put together (in all categories of artworks) because Sotheby's and Christies made losses, whereas we made a profit, albeit a reduced one.
In 2008, we earned more than Sotheby's and Christies put together.
– Why have so many Russian works of art turned up abroad?
– Russia sold artworks throughout the Soviet period, and many artists emigrated. Art works belong to that small group of assets which can be easily taken out of the country. When my grandfather fled, he had nothing except for the clothes he was wearing, some papers in his pocket, and a Stradivarius violin under his arm.
– Do you like modern art? Does it sell well?
We would prefer to deal in modern art but, unfortunately, the market demand for it at the moment isn't so high. Russian modern art is cheaper than both the Russian classics and international modern art. But the situation will definitely change in the very near future!
Russian modern art is cheaper than both the Russian classics and international modern art. But the situation will definitely change in the very near future!
– Who is your favourite Russian artist, and why?
– My favourite Russian artist is Mikhail Nesterov. He really understood the Russian people, the Russian landscape, and Russia as a whole.
– How many paintings were sold at the last auction?
– About 200.
– What is the price range? What is the average price for a painting?
– The price range is from 400 pounds sterling up to 2.4 million. The average price for a painting is over 35,000 pounds.
– Who are your buyers?
– In the main, they are wealthy Russians. 90% of them live in Moscow or Kiev and so spend most of their time in their native countries, not abroad. So, the Russians living in London are not particularly important to our business. And Eastern or Islamic subjects often attract Arab buyers from the Persian Gulf.
– Do you deal with your buyers in person? Is that important to your business?
– Of course, I do. Of course, it's important. That is one of the reasons why my co-director (my wife) and I live in Moscow. Half of our buyers are Muscovites. We are constantly putting on exhibitions here, and are soon to open our new office in the Russian capital.
– How much did you sell artworks for at your last auction? What were the sales like at the first one?
– Last year our sales exceeded 200 million pounds sterling. At our first auction, we traded at 200,000.
– That is growth by an order of magnitude. How do you explain such pace?
– We came to a rapidly growing market just at the right time, when only two auction houses were putting together auctions dedicated to Russian art. And being collectors of Russian art, and having recruited Russian-speaking staff to the company, we had an excellent understanding of the market.
– Incidentally, on the subject of staff, who works for you?
– Almost all of our employees are bilingual and speak both Russian and English. Most of them are from Russia or Ukraine. They are all very well-educated, highly motivated, highly paid. They work conscientiously.
– You recommend investors to channel up to 10% into Russian art. Why is that?
– All investors should transfer at least 10% of their assets into art. Investments in art are so long-term, like those in shares or property, but the art market has its own dynamic, so, diversification into it will bring further benefits and protection from inflation. What is more, you are able to enjoy works of art hanging on the walls at home. And Russian art is an especially interesting section of the market, for Russians first and foremost.
– For which Russian artists is there the greatest demand?
– Shishkin, Aivazovsky, Repin: the classics from the end of the nineteenth and start of the twentieth centuries.
– Do you spend much time in London?
– I spend most of the year with my wife in Moscow, and we go to London for the auctions.
– One of the greatest difficulties for western businessmen in Russia is the language barrier. How is your Russian?
– Mine is the worst Russian out of all of our employees. But I do try.
– What can you say about Russians as business partners?
For some reason, they believe there is nothing in Russia except corruption and mafia. Of course, Russia as a country is not perfect, the same can be said for Britain, but the problems in Russia are grossly exaggerated in the West.
– It goes without saying that each nation has their ways, but many English people are far too fearful of doing business in Russia and with Russians. We weren't fearful, which is one of the reasons why we have been successful.
– What are the English scared of?
– For some reason, they believe that there is nothing in Russia except corruption and mafia. Of course, Russia as a country is not perfect, the same can be said for Britain, but the problems in Russia are grossly exaggerated in the West.
– Have you had any trouble at the hands of the Russian bureaucracy?
– What for you is the main thing in business?
– Commercial success: that goes without saying. But generally, having something to do with art and those who love art: well, it's just great!