Michael Kazanjian is the chairman of a Beverly Hills family jewelry and gemstone business, Kazanjian Brothers, Inc. The company’s operation covers colored stone cutting, manufacturing, and wholesale, in addition to working with private estates to buy and sell collections of jewels.
Describe the background of your family business.
My grandfather, uncle, and father started the family company 107 years ago in 1913. They began conducting business in the United States in 1918, and I have been with the company for 53 years. We have a jewelry gallery, wholesale company, cutting factory, and a shop that manufactures jewelry, all on one level on a corner of Camden Drive in Beverly Hills, right next door to Christie’s, a prestigious auction house. We compete against Christie’s, so we’re located advantageously, and we’ve enjoyed this location for a little over a year now.
In terms of my introduction to the business, I didn’t realize I was being inoculated into the jewelry profession, so I didn’t attempt to be a jeweler. I worked for the family company while I was in school and through college, which was an additional source of income to pay for college. I began my career in banking and worked in that field for a short time after college until my father lost a senior colleague to a heart attack. That colleague was preparing to manage the company, so I took a one-year leave of absence to help my father. Clearly I’ve extended that one year to 53 years, maturing in the business over time and developing a deep love for all aspects of gemstones.
What’s your trade specialty?
My father and uncle were colored stone experts and cutters. To be an expert, you need to be as close to the material as possible, examining it as an architect would view and evaluate a raw parcel of ground. When we look at a raw stone, we envision what kind of beautiful gem could be within that uncut crystal.
In the early stages of our company, we were taking stones that needed to be re-cut or re-polished and re-purposing and selling them. We sourced raw material from different mines around the world, finding the best possible stones to cut, shape, and insert into jewelry. We’ve evolved into a company that not only cuts gems, but also manufactures jewelry.
The manufacturing side of the business led us to the diamond business because we started to buy private collections of jewelry estates. If there’s a specialty that we have, it’s as buyers of private collections and estates from all over the world or through stores that take in these pieces and collections from their clients. That side of our business is how we compete with auction houses that are dealing with the same clients as we do. We make an acquisition attempt to buy an item outright, whereas auction houses are making the promise that they will sell an item.
We enjoy a lively competition with the auction houses, but our strength is in understanding how to buy rubies, emeralds, sapphires, and diamonds. Our company continues to grow and find success because we have knowledge of multiple aspects of the industry. We understand manufacturing, fine craftsmanship, and how to bid for and purchase collections, whereas many of our competitors are specialists in diamonds, colored stones, or a single facet of the industry. Our knowledge and experience in these different areas helps us when we’re competing to bid for fine items at the right price.
What are some skills and tools you need to have in your area of the business?
You have to be creative, and you have to love what you’re doing. Love is the most important reason I can identify for doing any job because when you love something, you become specialized, you focus on your trade, you remember the details and intricacies, and you execute better on a finished product. In that way, your eyes and your love are your best tools. The process of carving, cutting, or executing is a skill that you develop, but the one ingredient not everybody has is the passion for what they’re doing.
What do you look for a gem?
We seek to acquire the highest-level quality stones that we can find, so we examine hundreds of pieces to find one or two or half a dozen that meet the test of being quality representatives of items for top retail stores. We are always upgrading the level of quality or standard we have, so we look for the best. I’ve been spoiled by the business of seeing an abundance of fine pieces, so the process is like developing a taste for wine. The more you taste, and the more you love what you’re doing, the more specialized your taste becomes. The experience of acquiring gems and developing a taste for quality and beauty is similar in that way.
Many different ingredients make up quality. The size and physical beauty of an item are important, but so is rarity. An amethyst, for instance, is beautiful but also plentiful. Because it’s plentiful, it has a lower value than rare stones. The ideal stone or jewel is one that possesses both rarity and beauty in the same piece. Rubies, emeralds, and sapphires that have pure crystals and intense, even, rich, vibrant coloring are the kinds of materials to look for.
A successful dealer injects him or herself into the market of buying and selling, so we’re working with dealers all of the time, buying, selling, and trading, and that activity teaches a dealer how to recognize which items are the best in the market and how to build a quality preference and reputation that separates you from ordinary dealers.
How did you achieve your gemological education?
I obtained a university business degree, but at the time that I was entering the jewelry industry, formal gemological training was hard to find. I gained much of my education through on-the-job dealing, cutting, making decisions about what to buy and sell, and learning what items were worth. Working and speaking with people in the trade and involving oneself in the everyday experience of the industry is the best way to gain knowledge in this business.
Today, gemologists graduate from trade schools and Gemological Institute of America educational programs, and I was actually on the GIA board for six to seven years. The GIA has a wonderful training institution, and all of the people who work for me have had that training. The discipline gives graduates a head start so that when they become involved with the work that I engage in, they are better prepared because they have been trained on how to look at gems, use the equipment and jewelry devices, and evaluate gems.
My education is old school, but the new school has taken over, and that’s what we recommend to anyone who wants to engage in this business. I would also recommend reading books, asking questions, and going to auctions to observe what pieces are being offered for sale. Going to museums, such as the Los Angeles Museum of Natural History, can be very helpful. For instance, we exhibited our red diamond for over a year in the Los Angeles Museum of Natural History. Then, if someone wants to take their interest in the industry more seriously, I’d recommend the GIA educational programs as a more professional opportunity for advancement in the industry.
What are some of your most vivid memories from your years of experience in the industry?
I’ve taken trips all over the world, and the only way you can learn is by visiting mines and territories and getting involved with people internationally. Between my father’s, brother’s, and my experiences, we’ve developed a pretty good informational map of where the best stones are. For example, my son just came back from a trip to the Colombian emerald mines, which are famous for their beautiful Muzo emeralds. That experience of traveling to these territories is where you gain a lot of knowledge about the fabric of the trade.
One of my favorite experiences was meeting the late Dr. Armand Hammer of Occidental Petroleum, who brought us a rare Fabergé pin to be repaired. Nobody wanted to touch it except for a gentleman in my company who was more adventurous than others. He accepted the piece, and he fixed it beautifully. Dr. Armand Hammer was so proud of what had been accomplished, he wanted to meet the owners, my dad and myself, and a friendship began.
Dr. Hammer invited me to travel to the Soviet Union with him because we were interested in buying diamonds from the Soviets, and he had a special ability to fly directly to Moscow on his own plane. He took me on several trips, and he introduced me to industry leaders in Moscow, opening up an opportunity for us to do business with the Soviets, which didn’t materialize until the end of the Soviet Union a few years later.
In the early ‘90s, I met with the head of the diamond industry in Moscow, and he took me to the Smolensk area, where they had the biggest diamond cutting factory in the world. Together, we set up the first diamond company to ever deal in partnership with Russia, and it was called the Russian-American Diamond Corporation. Acquainting ourselves with the Russians was a highly interesting experience and offered the potential for one of the biggest businesses the future could hold. The Russians had both the production capacity and exquisite gems but had only recently joined the world economy following the fall of the Soviet Union, so they didn’t know how to market their diamonds internationally.
My company began handling the marketing arm of the tremendous business, but we misjudged the corruption present in the new Russian economy. Not wanting to break any American laws, we often denied high-pressure demands for bribery. We were ultimately forced to destroy the business because we refused to pay bribes or break any laws, so what began as a huge business deal turned out to be a dead end, and we had to move on to other ventures.
How does working in different parts of the world change your work?
When I was growing up in the business, my father would invite figures from all over the world, including India, Africa, and China, to America, and I would meet these dealers. Those experiences taught me about different cultures and what each culture is looking for. The jewelry business is international, so not only are you picking the place in the world where you are buying or cutting a stone, but you are also identifying the place in the world where it is best to sell a particular stone. We had the advantage of knowing the world market well enough to know how to place gems in different markets.
In the 1950s, when I was not yet in the business, my father and uncle had a contract with the largest sapphire mine in Queensland, Australia. They couldn’t cut all of the stones in America because the labor costs were too high, so they opened up cutting factories in Thailand. They learned how to deal with people in the market who have great motor skills, and Bangkok ultimately became the biggest cutting center for colored stones in the world, partly as a result of all the training and equipment that my uncle brought into the market at that time.
In another example, my father and uncle bought the production of a ruby mine in Africa, so that project required a different type of evaluation. My uncle cut the finer stones in America in order to achieve the best results, but the lower-grade stones had to be cut in areas where the cost of labor was much cheaper.
When I joined the company, star sapphire jewelry was being made in large volumes. We were manufacturing jewelry around these beautiful stones that my uncle was having cut in Thailand and America and marketing through some of the fine jewelry stores around the United States. My job was to travel to these stores, show our collection, and take orders on the different products that we were offering for sale.
Australia has also been known to have some of the greatest opal mines, so every part of the world is very unique, though America has a shortage of mines of any note. A mine near Billings, Montana, called the Yogo mine, did produce some beautiful bright sapphires, some of which first appeared in the early 1900s at Tiffany & Co. My uncle and father were involved with that mine production, marketing those stones as American sapphires around the United States.
Mexicans opals were not even known until they were uncovered in parts of Mexico, and we helped to bring those stones to the United States and the world market. Interesting marketing opportunities often arose from looking into which parts of the world somebody had uncovered something new, finding the rough, cutting it, and if it turned into something beautiful, acquiring enough of the production that we could build it into a business opportunity.
What are some significant lessons you’ve learned along the way?
My dad always said he learned something new every day, and he was in the business until he was 94 years old. There is no end to learning. The key is to keep an open mind, challenge yourself, and learn about new areas of the trade.
Making good choices with people and finding professional people with integrity takes time, experience, and instincts. If I’ve learned any lesson, it’s not to be greedy, but to be more careful in assessing people, to be sure that if you’re starting a business, it’s with somebody who meets certain tests of character. Everybody has a reputation if you bother to learn about it, and everybody has a biography if you look for it. Everybody has a history, and history repeats itself. There are so many scientific treatments and processes that can modify or change gemstones’ appearances that you have to be able to trust and know who you’re dealing with.
I’ve even spent time at the post office, looking at wanted posters just to examine the faces of criminals so that when I see a certain appearance or certain look in the eyes, certain facial expressions, I learn to avoid people who give me the wrong instinct. It’s important to be able to read and interpret the character of people you’re doing business with.
What side of the business or types of projects make you particularly delighted?
One of the most wonderful enjoyments is meeting a family who has inherited, and wishes to sell, an important collection of jewelry, and they have done some research and found us as a candidate for handling their sale. If it’s a big enough collection, we’ll often go to their homes or their bank vaults to examine the pieces, or they’ll come to our office, where we have more equipment to evaluate the collection. It’s like being a little kid playing with marbles, and you don’t know what you’ll end up seeing. It’s a suspenseful occasion because you might see jewelry that hasn’t been on the market for 50 or 100 years, and you’re being offered the chance to assess, evaluate, and bid on these items.
I recently purchased a collection that had been in a woman’s family for 100 years, and I had known her for 40 years. In her will, she requested that our company perform the assessment and purchase from her family. It took us 10 hours to evaluate all 200 of the pieces in the collection, and we came across items that we had sold her 20 or 30 years prior. We were able to re-purchase these items, which is always wonderful because it’s like being reunited with members of your family that you haven’t seen in so many years.
Every month, on several occasions, we’re able to look at wonderful jewelry for evaluation and purchase. That’s what makes an old man (I’m almost 83) happy. I work every day, just as my dad did until the age of 94, and I have a wonderful team of people helping me. This business makes life exciting for me, and I didn’t have to retire at 65 or 70 years old like other folks in industries where that’s expected.
How has the trade changed, and where is it going?
The trade has changed dramatically because it’s a much bigger industry than when I started. When I started, there was a well-defined separation between the stone cutter, as we were; the manufacturer who made the stones into jewelry; the wholesaler who conveyed the gems and jewelry to the retailer; and the retailer who sold the gemstones and jewelry to the final consumer. Those lines have been blurred and broken down partly because of the Internet. Today, people can buy directly from wholesalers, cutters, and manufacturers.
We used to only deal with stores and dealers, but now friends and important collectors approach us looking for special gems and stones. As a result, we have a mixture of a dealer business and a private business going on all the time. The whole industry doesn’t have the definition that used to be there. The blurriness of it is part of what makes it so critical that you know with whom you’re dealing.
The other changing aspect is the need for any important stone to be well-certified by one of the leading labs - the Gemological Institute of America or American Gemological Laboratories. These labs are critical in that people receive verification of what they’re purchasing from a laboratory perspective.
In terms of where the industry is going, I think it needs better disclosures. I’m concerned that origin, which is a big test of where a stone comes from, is magnified into being more important than it should be. The beauty of the stone should be the final test, but people in our industry have brainwashed people into thinking origin is a critical issue, but every lab comes back with a different origin, which creates a lot of confusion and can critically affect the value of a gem.
There needs to be more control over the outflow of information. These standards have to be adjusted and changed, and our industry has to work better together to protect the public and inform the public about how to make proper and educated decisions. The industry needs the strength of an organizing body, such as the GIA, to create an organized structure of accurate information, but we’re missing that ingredient right now.
Who are some of the people you regularly work with?
Your best decisions about people are confirmed by the test of time. When you’ve been in the industry for 50 years, you meet and know a lot of people, and those people with whom you continue to enjoy conducting business, who you’ve known for 40 or 50 years, become your family. I’ve had the good fortune of making wonderful friends with whom I’ve done business with for several decades, and when I have a question or I want some advice or another opinion, these are the people I consult.
One such person is a partner that I have, who co-owns an affiliated company. He used to run an auction house but now directs a business that sells wonderful jewelry on the Internet. We’ve been partners for almost thirty years. He and I buy wonderful pieces together from private collections, and we often consult with each other.
Additionally, the young people who are entering the industry are both refreshing and valuable to the future of our industry. I’m pleased to see bright, engaged, young gemologists challenging old norms, such as the origins of stones and the misguided selfishness between labs. Many institutions do not want to share information with each other, which encourages misinformation and varying lab conclusions. The young people who are challenging these norms, such as my son Douglas, are greatly improving and providing optimism for the industry.
What distinguishes someone of excellence in your trade?
Every department in our industry, whether it’s colored stones or diamond cutting, polishing, or manufacturing and designing, produces names that will stand out and be ratified by their peers. That’s because reputation in a small industry is everything. For example, in the real estate industry, it’s so populated that it’s hard to differentiate who is really excellent. The gem industry, on the other hand, is still small enough that one can readily identify people who are recognized or exalted in each area of the trade, and those are the people we seek out when we need a special service.
My firm doesn’t cut diamonds, for instance, so I will reach out to a certain diamond cutter depending on what the diamond requires and what kind of stone it is. We as gemologists and jewelers have learned how to protect ourselves and our stones when we need to venture into unfamiliar territory.
What are the differences between diamond cutting and gem cutting?
Diamonds are cut by special diamond cutting equipment, and it’s a totally different type of cutting. Diamond cutters use special machines, equipment, and wheels that are developed specifically for diamonds and no other stone. This is not our area of expertise, so we hire exceptional talent to perform this type of work.
Colored stone cutting is more about hand-eye coordination and artistry than machinery, unless you’re performing basic small stone cutting. You have to carefully massage important colored stones in order to pull the best color, luster, and beauty out of a stone and achieve the purest crystal result you can. We have a special shop that cuts colored stones using equipment suitable for hand-crafting, and the process requires a different type of artisanal skillset. A colored stone cutter is more of a creative and an artist than a mechanic.
Who are some of the more renowned designers?
Marketing, reputation, and history define who has met the test of success in the minds of the industry. I prefer to stay out of the discussion about who the best designer is, other than to say that the standard of professionalism exhibited by Cartier is a great example of a distinguished designer. I have been impressed with Cartier’s ideas, creativity, and design as a firm, and they’ve formulated a standard of quality and production that is unmatched by others.
That being said, there are other wonderful, impressively creative designers out there, but they haven’t marketed themselves to create the demand that some of the big firms have. Creativity is very unique, and we can have many differences of opinion on who is brilliant and who is the best. Finding a designer that appeals to your taste is a personal choice, rather than a choice that a professional can make for you.
What are some historically significant stones you’ve worked on?
We own the finest red diamond that’s ever been uncovered, and it’s one of the rarest treasures that has ever been produced by nature. We did nothing to add to its beauty because it’s a historical stone that we would not want to touch. It was in perfect condition when we bought it, so it did not require any polishing.
We also cut the largest star sapphire in the world, and it’s called the Star of Jolie because Angelina Jolie agreed to assist us with designing and modeling the piece. It weighs 888.88 carats, and the previous largest star sapphire, the Star of Queensland, weighs 733 carats. The Star of Jolie lives on a chain of star sapphires, hanging on the pear-shaped drop of a double-sided star. The piece is almost too heavy to wear, but it’s more of a display piece than a wearable item, and it’s magnificent. When we have an item that’s special and rare, such as the Star of Jolie, we dedicate a good portion of the result from the final sale to our family foundation that largely supports children’s causes.
What makes gems so valuable to you?
The natural beauty and uniqueness of certain gemstones offer a powerful initial attraction. We seek to transform a raw stone into the most beautiful outcome, and if our stone has a more beautiful color, purity, and brightness than other stones, it’s going to have a relatively higher value. Because we love what we’re doing, we can rememberer what we’ve seen, and our visual memory helps us to establish how much rarer a particular stone is than other stones.
On the topic of beauty, you can see that quality in a synthetic stone, but when you know that a beautiful stone has come out of the ground, it hasn’t been altered, and it has formed from a rare natural process, the stone transforms itself into something unique, special, and different. That quality of rarity is what gives the stone value and the desire to be possessed by somebody who can say they have something not only beautiful, but special.
At the end of the day, we all look through different lenses and see beauty in a different way. Because we all see beauty differently, what might appeal to you might not appeal to me, and vice versa, and I am so glad for that because if we all liked the same things, this business wouldn’t be nearly as much fun.