The Collectable Debacle

A year ago, I invested $100 into a Fernando Tatis Jr. rookie card in a Beckett Black Label slab on Collectable. I thought maybe the $10 a share would appreciate in the modest Collectable portfolio I had built.

So I had a chuckle when I received an email alerting me of the $0.58 a share I'd get after the card sold on PWCC. My $100 turned into $5.80. Here's the thing, I don't blame anyone but myself for that loss or my other losses.

I put money into Collectable offerings without assurance they would make money. I made some good investments and some bad ones. I was aware of the risk, for which Collectable holds no responsibility.

Who's Leading Collectable?

One year after my Tatis "investment," Collectable is a sinking ship without a captain or even a competent sailor. It fell hard from when it was riding the high of the first MINT Collective in 2022 and when the highly enjoyable Alan Goldsher was releasing a daily podcast.

Now, no one wants to talk about Collectable - not current employees, not even former employees.

Former CEO Ezra Levine is making the rounds with his new venture, MASCOT, but I find it out of touch. He'll talk about Collectable's accomplishments all day without really acknowledging the people who lost chunks of money using the platform.

This article is not an attack but a criticism. Levine worked hard in his role and should be applauded for trying to get institutional investors into the collectibles category. But the 100,000 unique investors that used the platform need to be recognized for trusting the company's stewardship.

And the current leadership, if we can call it that, is nonexistent. Who's in charge at Collectable? No one seems to know.

The Current State of Collectable

Recently, Collectable gave this notice:

"Dear valued Collectable user,

Despite our efforts to foster a healthy secondary trading market for our series, recent surveys of all Collectable shareholders regrettably showed clear majority support for finding new liquidity opportunities outside of our app. (emphasis mine)

"Additionally, given current market conditions, the reality of Collectable's financial position means that we cannot plan on keeping all assets trading on the platform indefinitely."

Talk about pouring salt in the wounds. Gaslighting users for part of the company's demise is not the way to go out. In fact, at one point, it was Collectable's idea to find liquidity opportunities outside of the app. Now, they (the invisible leadership) want to point the finger at the users, showing a complete lack of accountability.

So it's clear, Collectable is going under. Ceasing operations can be messy, but even that's becoming a mess.

The Fire Sale

Liquidation sales are part of any company going out, but here are a few of my gripes with Collectable’s:

1. Why not sell individually? They've decided to sell the cards in lots as lots, but auction results can be optimized by selling cards individually.

2. Fees. They apparently had zero leverage when negotiating auction fees. They're paying the standard 10% fees that just about anyone else would pay.

3. Seasonal selling. If the fees don't matter, why not wait to sell the cards at times that make sense? Specifically, selling items a few weeks before the sport's new season begins, when it can get a few more bids.

4. Majority holders. What will eventually become of the majority-owned items by a consignor, such as the Andre the Giant jock strap or the Muhammad Ali title belt majority-owned by Sports Immortals?

The Future of Fractional

Collectable showed there's demand for a sports-only fractional site. But the company is leaving many with a sour taste. Any future fractional platform in the sports memorabilia category must study Collectable's successes and mistakes.

The irony is that the timing in 2020 could not have come at a worse time for Collectable. Its offerings were inflated during a bubble and without any industry discount. Chasing fads also didn't help (game-used Chris Bosh sneakers, anyone?).

Collectable would be much stronger if it opened for business today. But even as the company completes its liquidation, the people behind the scenes should account for the future reputation of fractional investment by being more upfront and putting a face to it all.