Investing in Nostalgia is Possible Even if You Didn’t Grow Up in the 80s

We talked to a Magic: The Gathering investor (yes, it’s totally a real thing) about how to make money in collectibles.

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Aug 13 2018, 12:32pm

Cover Image by VICE

With GLOW on the world’s Netflix queue, the Avengers topping the box office, and basically everyone in hip-hop sampling vintage video game music, it’s clear that our cultural consciousness is firmly stuck in 1986.

If you’re the Alex P. Keaton type, you’ve probably realized there’s a major opportunity to capitalize on all this nostalgia for vintage toys and geeky paraphernalia. But what if you weren’t blessed with an attic full of your uncle’s mint-condition figurines? Is there still a point trying to make money in old-school collectibles?

Hey, it’s working for Toronto-based economist and entrepreneur James Chillcott. He boasts that Magic: The Gathering cards make up about a third of his financial portfolio, and that buying and selling goblins and chimeras is keeping him pretty flush these days. Case in point: Chillcott just sold an Unlimited Black Lotus (an iconic collector card) for .43 Bitcoin, or $8,993.49 CAD. “As an investor in the stock market, to get 20 percent a year you’d be thrilled,” he explains. “With Magic: The Gathering, I’m regularly scaling between 50-80 percent a year.”

Flipping collectibles isn’t just part of his retirement strategy, it’s also Chillcott’s full-time job. He’s the co-founder of ShelfLife—a Dragons’ Den-approved online marketplace where collectors buy and sell items from any fandom, historical era, or niche interest—and also he writes and podcasts for MTGprice.com, a site that focuses entirely on financial speculation in the world Magic cards.

Want to make a fortune dealing in the nostalgia trade? Here are Chillcott’s word of wisdom.

Pick your era of fandom strategically.

“Nostalgia really kicks in when people hit their late 20s or early 30s,” says Chillcott, “And it usually revolves around brands that were important to them in their formative years.” If you’ve got any doubts about this, just take a look at the world of fashion right now. Early 90s sportswear dominates Instagram, and every girl at the cafe is channelling either Angela Chase, T-Boz, or Elaine Benes.

Chillcott understands the immense power that nostalgia wields—so much so that he’s probably the only nerd in the world to credit Michael Bay for rekindling his love of Transformers. “When I was 12, I’d decided that I was too cool for toys and knocked all my Transformers over the fence with a baseball bat,” he says. But when he hit his late 20s and caught the new movie in theatres, all those warm fuzzy childhood memories started flooding back. After searching on eBay to track down what he’d destroyed, Chilcott found himself morphing into the ultimate titan of collectibles capitalism.

To replicate Chillcott’s success, start by focusing on products and brands that were particularly hot 20-30 years ago. Chances are, you’ve got an eager market of millions ready to take those limited-edition Samurai Pizza Cats figures off your hands.

Know your products.

The old stock market maxim of “buy low, sell high” is actually a lot easier to follow when you’re dealing with collectibles. It’s hard to know what’ll affect the price of your corn stocks in six months (bad weather? A “no-corn” diet craze?), but many toy markets are much more straightforward. “With the stock market, there are so many micro and macroeconomic variables,” says Chillcott. “But in the world of Magic, you only need an understanding of the general power level of a card, and how to identify it as being useful.” Once you know that, you might be able to predict whether the card will prove perennially valuable for players—and perennially lucrative for you.

For example, if you snag a $5 copy of Punch-Out Special Edition for NES at a garage sale and know it regularly sells for over $150, you can basically guarantee you’ll be making a nice profit—after all, it’s not like Nintendo’s gonna go back to 1987 and make more of them. To get started, you need to know what to watch out for in your chosen fandom so you can later deploy your knowledge when other people don’t have it. Yep, taking advantage of kind grandmothers clearing out their attics is really the name of the game here.

Opt for brands with long shelf lives

We all know there’s money in the old-timey action figures, but newer products can still net you a healthy return. To minimize your risk in buzzworthy markets that don’t yet have price guides, stick to this simple litmus test: Ask yourself, “is this brand more of a Pog or a Barbie?” Like, is this plastic tchotchke from a company anyone’s ever heard of? A brand’s staying power is a great indication of their newer products’ enduring value.

“Look to brands that have stayed strong for three, four, or even five generations,” advises Chillcott. “G.I. Joe has been around since the 60s, Nintendo since the late 70s, and Batman and Superman are closing in on 100 years old. Anytime you have a brand that’s going to be important to multiple demographics simultaneously, it’ll be a major revenue generator.” In layman’s terms, anything you can sell to both a privileged 12 year-old in the suburbs and a 50 year-old banker on Bay Street is going to be worth your attention.

Sometimes it’s OK to get high on your own supply

One of investing’s central tenets is to separate your emotions from your purchases, but few collectibles dealers are in it solely for the money. Look back far enough, and odds are you’d find a Uhura poster on their wall and a Dungeon Master’s Guide on their bookshelf.

“We all have our own line in the sand in terms of what our goals are, and how we’re going to prioritize making money versus acquiring things that are special to us,” says Chillcott. “Most people aren’t necessarily trying to fund their retirement, they’re just trying to make their hobby cheaper so they don’t have to justify it to their significant other.”

So to summarize, stick to the media you love, be realistic with your financial expectations, and don’t blow your monthly rental budget on that mint-condition set of The Misfits from Jem and the Holograms or it’ll cause problems at home.