Professional Jeweler Archive: A Dot-Com Niche

July 2000

Managing/Estate Jewelry


A Dot-Com Niche

The newest money is being spent on some older merchandise – the Silicon Valley is booming with young millionaires who want fabulous estate jewelry


The term “Silicon Valley” is synonymous with technology, conjuring visions of futuristic trends and young, progressive professionals. It’s a wealthy area – reportedly, 64 new millionaires are created each day in California, and most are in the Silicon Valley area south of San Francisco.

For all this new money, a lot of the jewelry sold there is old. The region is home to one of the nation’s most successful estate jewelry businesses – S.H. Silver Co. of Menlo Park, CA.

Growing Together

The 20-year old company grew along with the Silicon Valley. “Some of those who struggled to buy a diamond years ago are now among the richest people in the country,” says Stephen Silver, company founder. Many of the newly rich are his clients. Over the years, Silver established relationships with major players in high-tech, and he credits his success to service and referrals.

When he started his business, Silver asked himself, “How can I serve customers better than what they’re getting today? What can I do to get credibility and trust?”

In the estate business, serving customers better meant starting with appraisals, and Silver recalled his own experiences with customers in a previous job. “People had to leave their jewelry in the store for 10 days to two weeks, and that was uncomfortable for a lot of them,” he says. When he started his own business, he did appraisals by appointment so clients could watch him do the work. It also was more efficient. “We could make more money by organizing our time,” he says.

The Big Break

Silver’s big break came in 1984 from a referral. A San Francisco Bay area attorney asked him to sell a Tiffany & Co. necklace for one of his clients. The necklace had an 81-ct. tanzanite center stone, about 270 carats of smaller tanzanites and 290 colorless diamonds each weighing 1/5 to 1/4 carat. He estimated the original price at $1 million.

“The seller was from one of the most prominent and powerful families in the Bay Area, and our name got out to their social circles,” he recalls.

By the 1990s, the young adults who wore sneakers and jeans started to make their mark in the Silicon Valley. “They’d already bought their houses and Ferraris and needed something else to collect,” says Silver. He was ready for them with estate jewelry. In one year, he sold 10 diamonds ranging from 10 to 20 carats each.

In addition to his retail operation, Silver has a wholesale division that sells to dealers and retailers. He works with highly rated retailers in two ways.

  • Buying and selling estate jewelry through them.
  • Conducting promotions in which a retailer advertises that S.H. Silver Co. will evaluate and buy estate jewelry. After a connection is made between the store and estate pieces, Silver brings in goods to sell to the public. “It opens up avenues for stores that don’t do much with estate jewelry,” he says. “A store can be in the estate business without making an investment in it.”

– by Jack Heeger


Estate Tips

Stephen Silver offers some additional thoughts on various aspects of the estate jewelry business:

Inventory

“Inventory can get stale quickly so I force turnaround if it ages. The estate business is capital-intensive; you can’t operate efficiently unless you turn inventory two or three times a year.”

Golden Age of Jewelry

“Jewelry is a marriage of what the earth has to offer and what humanity has to work with it. The Golden Age of the industry was between 1850 and 1950. With the annihilation of Europe during World Wars I and II, much of that creativity and artistry was lost. This combined with the development of the United States – more people could buy jewelry – forced the industry to become more production-oriented. As a result, it’s more difficult to find unique pieces.”

Client’s Interest

“You’ll benefit if you keep the client’s interests in the forefront, even if you’re not making money (on a small transaction).”

Discipline

Silver attended the Gemological Institute of America and spent two years sorting melange lots at Udko Industries, which later became Unigem International. “That taught me discipline and gave me the opportunity to exercise decisions. When you’re sorting 50 or 100 carats of melee a day, you become focused on the process. Today, I look at a diamond in exactly the same way whether it’s 3 points or 10 carats.”

Promotion

To build the retail business, Silver’s wife, Eileen, created morning coffees and afternoon teas that clients helped to promote. Silver gave them invitations, and the clients invited friends. Also Silver and a local clothing retailer staged a fashion show with clothing that complemented the jewelry. Eileen prepared a script that described the history of the pieces shown. “An educated customer is the best customer,” he says. Were the events successful? “The women had a blast.”

Estate jewelry dealer Steve Silver counts the Art Deco period as one of those in the "golden age of jewelry." These Art Deco platinum and diamond bracelets feature the intricate detail and crisp lines characteristic of the period.
Emeralds are one of estate jewelry dealer Steve Silver's favorite gemstones. These Art Deco platinum, diamond and emerald pieces show them off to their best advantage. The watch is by Audemars Piquet.

Photos by Robert Weldon


Copyright © 2001 by Bond Communications