This is when history and collectibles collide. Recent news of the $43+ million sale of the last surviving copy of the U.S. Constitution was game-changing on two fronts. The copy of the U.S. Constitution managed to more than doubled the Sotheby’s estimate of $15 million to $20 million. What may have been even more earth-shattering than the price was the winner and how the auction was actually won — a group called ConstitutionDAO was trying to win the auction, but billionaire Ken Griffin was the winner.
So what about a copy of the Declaration of Independence?
The “DAO” in ConstitutionDAO stands for a “decentralized autonomous organization,” and the reality is that this would have represented a form of fractional ownership. If that is a mischaracterization, at a minimum it could be considered fractional financing.
It turns out that interest in one asset has garnered interest in another related asset. The RallyRd app had an initial public offering of $2 million already in 2021 for a 1776 “broadside” of the Declaration of Independence. This $2 million sale was for shares in fractional ownership. Now an announcement from RallyRd has been made that it has received a buyout offer for its example of the Declaration of Independence. If accepted, the buyout would represent a 40% premium at $2.8 million!
Image courtesy of RallyRd.
Collectors Dashboard evaluates high-end collectibles as an alternative asset class. This means collectibles are attracting the same capital that could have been invested into stocks or bonds. Let’s just say that the sale amount of $43+ million (or $2.8 million) could have gone a long way buying stocks, bonds or real estate.
RallyRd noted at the time of its IPO that it took several weeks for most colonists to hear the news back in 1776 that would form the basis of American democracy. Large single-sheet copies were printed called “broadsides” that were distributed. Rally’s broadside copy of the Declaration of Independence printed in Exeter, NH was after word finally reached the town on July 16 of that year. This piece was previously displayed at the National Constitution Center and was listed as just 1 of an estimated 20 privately-owned examples that has survived.
As for the $2.8 million buyout offer, RallyRd said that this power is in the hands of more than 5,400 individual owners of this example of a Declaration of Independence broadside. Rally’s current summary indicates that that there are 5,547 investors. No mention was made about which person or group made the buyout offer, but Rally’s announcement did say:
This offer represents a 40% premium… If approved, this would be a record sale for any Walsh-15 copy of the Declaration of Independence.
There is a massive interest in high-end collectibles. Based on the business transactions seen in 2021 and prior recent years, that interest doesn’t appear to be dimming at all. Just don’t fall into the trap thinking that prices can only go up. That said, this feels like a situation where the holders may vote to hold out for more money considering the short time that it has been held and considering the related sale of the U.S. Constitution copy more than doubled its sale price expectations.
