Karen Boyer is a former hedge fund executive who studied art history at the Sorbonne and later turned her love of New York’s galleries and emerging art scene into a successful art advisory business, Elements in Play.
How do you prepare your clients for the fair?
The fair is a lot of fun, but to get the most out of it, I take my preparation seriously. In the days leading up to the fair, galleries send out previews of what they’ll be showing, which I go through carefully to curate a selection of works to discuss with my clients. The timing here is key — galleries are eager to make pre-fair sales and will hold works for fair-goers to see in person, but only for the first hour of the fair. So when the first VIP day arrives (there are two), I already have works on hold for my first clients of the day, and we view them promptly. For clients seeking art for specific areas of their homes or offices, we come armed with precise measurements and photos. And it might seem an obvious suggestion, but given the fair's vastness, limited food options and unforgiving concrete floors, I encourage my clients to have a hearty meal beforehand and wear comfortable shoes.
How do you get ready for the after-hours festivities during the week?
Because most collectors tend to leave by Friday, I spend more time at early-week gatherings and opt for a good night’s sleep over late night parties — so I can be fully present when I need to be. With so many events to choose from, I prioritize those hosted by galleries and institutions, including White Cube, Marianne Boesky Gallery, Kasmin Gallery, ICA Miami (where I co-chair a patron’s group) and Locust Projects (where I serve on the board). These all happen before the fair opens on Wednesday. This year, I'll also be at the Rubell Museum when they unveil their prestigious 2023 artist-in-residence, Basil Kincaid.
Many people describe the current state of the art world as a buyer’s market. Is that true — and does that change the way you approach the fair?
The current market definitely favors buyers, and I'm ready to help my clients press their advantage. Clients often work with me because I can get special access to sought-after works. With the arrival of COVID, this became more competitive, driven by an increase in art purchases and speculation. In fact, until recently, it could be difficult to get access to the most popular works without agreeing to buy another work by a different gallery artist; or to buy one, give one (BOGO) to a museum. But today, with the market cooling and speculators pulling back, I anticipate having much greater access to works, without these expectations. Galleries might also be more open to negotiating price, which helps me improve my clients’ position even more.
Do you have a secret to navigating the crowds and traffic in Miami?
Ha-ha — yes, a lot of them! Think through your visit to avoid unnecessary bridge crossings from Miami Beach to Miami. When they’re unavoidable, allocate at least an hour for the return journey. Familiarize yourself with the fair layout for easy navigation — orienting yourself with a map every few minutes is maddening. Arrive at the fair when it opens, and try to plan as many of your activities as possible within walking distance. I also have to point out that going with a seasoned art adviser is a game-changer, since we know our way around the fair and where the galleries are located. We also have established relationships with the galleries and can quickly get a gallerist’s attention, even in bustling crowds. The fair is business, but it can also be a real pleasure if you plan right!
What family businesses need to compete in a redefined global economy
By BOBBY STOVER and JAMES BLY
It’s fairly apparent that the world has changed dramatically over the past few years. But the extent of those changes and how they upend long-held assumptions about global economics may not be as obvious, especially for family businesses. For nearly 80 years, consumers and companies alike have been reaping the benefits of globalization, with products becoming more affordable even as they have continued to improve.
However, since the pandemic, the new economic S-curve that had replaced the former post-World War II S-curve has accelerated. Growing de-globalization trends indicate that countries and regions are increasingly inclined to consider making their own goods, growing their own food and securing their own energy sources — all with populations that are both aging and shrinking. Conventional strategic planning based on historic patterns and assumptions will no longer suffice as family businesses seek a competitive advantage in this new environment.
The new S-curve trends impacting today’s business growth strategy — ranging from disruptive new technologies to inflationary monetary policy and talent management challenges — will be different for every family business. For example, a business that sells capital goods within international markets could be faced with challenges including reduced globalization, geopolitical tensions and shifts in policy, and supply chain disruptions. And that’s just the start. Potential regulatory changes could also make it harder for smaller manufacturers to compete in a redefined market.
Challenges like these make it clear that family businesses are now operating in a world that requires reexamination of strategic priorities to avoid disruption so they can remain competitive and fulfill their long-term growth ambitions.
We’ve identified four core strategic competencies that family enterprises should embrace and execute to ready their businesses to compete in a rapidly changing world.
1. BUSINESS GROWTH STRATEGY
Cultivating a more valuable family enterprise in the new S-curve environment requires ongoing business growth and minimized disruption. In turn, developing a business growth strategy starts with assessing your current capabilities relative to your future aspirations, examining the enterprise’s strengths and weaknesses, and determining what skills and resources will be required for future aspirations.
With that information, a family business can clarify strategic priorities, opportunities and challenges and build an action plan that can help achieve increased resilience and sustainable growth. For example, to de-risk supply chain disruption and geopolitical risk, many companies have developed strategies to shorten their supply chains by identifying alternative critical-component vendors domestically or in less volatile geographic areas of the world.
2. COMPANY CAPITALIZATION STRATEGY
Funding business growth requires a long-term company capitalization strategy. But sourcing and managing capital to fuel business growth can be challenging, particularly if you want to keep family ownership control and create more value for future generations. Family enterprises should understand all available capitalization options and their alignment to long-term capital agendas. Many times, nontraditional capital sources, including the direct capital markets (e.g., insurance companies, pension funds and family offices), have better capital alignment with the long-term outlook of family businesses, such as flexible terms and extended commitment periods.
3. SHAREHOLDER LIQUIDITY STRATEGY
One of the biggest disruptions to family-owned companies is often a lack of clarity regarding shareholder liquidity needs. The liquidity requirements of family members can be different for each generation participating in ownership. Developing strategies to meet long-term liquidity needs is critical to maintaining a patient capital base among shareholders. For example, coming out of the COVID-19 pandemic, shareholder liquidity disputes drove significant disruption. There were cases where family members had been receiving dividends and distributions. But when revenue declined during the pandemic, and capital had to be rebuilt thereafter, distributions were curtailed. For some family businesses, this caused conflict, creating unrealistic liquidity demands of the company and, in some cases, leading to a sale of the business.
A shareholder liquidity strategy can help manage the short- and long-term capital needs of both the owners and the business as they continue to grow. To manage the shareholder liquidity policy, managers must accurately forecast the company’s balance sheet cash flows to keep capital available to meet the capital demands of the business while producing sufficient cash flow to support shareholder liquidity when needed. Strategy considerations include the design of a dividend and redemption policy, financial modeling to support and update these designs, models for shareholder liquidity needs and, finally, integration of your shareholder liquidity strategy with your growth budgets and capital strategy.
4. GENERATIONAL TRANSITION STRATEGY
Families who own successful multigenerational enterprises have a strategy at the heart of their business that goes beyond just tomorrow’s operations. It lays out parallel governance for both the family and the business. This helps provide for the cohesion, stewardship and competency needed to sustain a healthy business for generations.
The family governance portion of the strategy addresses preparing the next generation to be good stewards of operating businesses and educating them on the roles and responsibilities of being affiliated with the business, whether actively working for the company or not.
Meanwhile, the business governance activities address procedures for ensuring that well-qualified people are running the company by creating an effective fiduciary board of directors. The board then appoints qualified management, who are responsible for tasks such as transparently reporting on results and developing data analytics to better understand growth opportunities and risks.
Our rapidly changing world requires anticipation of demands to come and agile responses to those needs. Refocusing the traditional strategic planning process to emphasize business growth, the capital agenda, shareholder liquidity and generational transition can equip family-enterprise leaders for the challenges posed by the new S-curve trends, ensuring their businesses can endure and stay in the family for generations.
Bobby Stover is EY Americas family enterprise and family office leader, and James Bly Jr. is managing director of U.S. EY family enterprise business services.
The views reflected in this article are the views of the authors and do not necessarily reflect the views of Ernst & Young LLP or other members of the global EY organization.