Jonathon Krasny was 7 when his father gave him an envelope of old coins that led him to a lifetime of collecting.
Today he has thousands of coins worth considerably more than anything in that envelope; some fetch more than $30,000 for a single coin.
Three years ago, Krasny turned his hobby into a business when he opened A Coin Exchange in Tarzana. During his first full year in business, he reported $1.2 million in revenue and since then that figure has jumped to $2 million.
Krasny has grown his firm mostly through word of mouth and walk-in clients, who range from serious collectors to people with jewelry or coins they want appraised and sold.
“We have a handful of regular clients, but coin collecting is such a huge hobby that people find stuff buried away and we constantly get new customers coming in for appraisals,” Krasny said. “We have all types of customers. The typical one has something to sell or something they want to buy.”
Beth Deisher, editor of Coin World, a trade publication based in Ohio, said the coin dealership business is becoming increasingly competitive. Players now include everyone from “vest pocket” dealers who work trade shows to large operators who stage wholesale public auctions of coins. There are also a growing number of online coin dealers.
Money and precious metals
Krasny started his firm by dealing in rare coins, precious metals and diamonds. After three years, his trade in reselling upscale jewelry has increased, although coins remain his core business.
The store has started specializing in “error coins” that make it into circulation with major flaws. Krasny has one coin that’s the size of a dime but stamped with the design of a quarter. It’s worth $4,000, he said.
Eventually, he wants to expand online with sales of error coins and other collectibles with mistakes from Beanie Babies to baseball cards.
Coin World’s Deisher said error coins have become a hot item, especially with the release of quarters commemorating states. The publication has been swamped with questions about 20,000 Pennsylvania quarters released last year that have the head of George Washington facing the wrong direction. The coins are valued between $45 and $75.
“They’ll probably end up going higher (in cost) because everybody wants one,” Deisher said. “It’s a little bit like a national treasure hunt.”
Krasny has built his collection based on a combination of coins that interest him and those requested by customers. He and a co-worker travel to trade shows across the nation in search of coins and work with wholesale dealers and other individual traders to acquire hard-to-get items.
Other coins are acquired from people who simply find them around the house and take them to the shop.
“In five minutes, we’ll have someone come in with a coin worth 10 cents, and the next person will come in with a coin worth $25,000 to $30,000,” Krasny said.
One of the most valuable coins in the shop is a $20 gold piece dated 1907 that’s valued at around $30,000. Less than 20,000 of the coins were put into circulation, which is a big reason for its high value.
On the other end of the scale, the shop features Indian-head pennies worth a single dollar. “Everything excites me because I’ve been doing this since I was a kid,” Krasny said. “We find some pretty neat stuff. At the end of the day, I don’t want to go home.”
Renewed interest
The U.S. Mint estimates that tens of millions of adults now collect coins, And that number is growing now that the quarters commemorating states are reinvigorating interest.
“I stopped by my local Wal-Mart last night, and when you walk in they have a huge display for new coin albums,” Deisher said. “That’s the first time I’ve walked in and found the albums up front. People are asking for traditional (coin) albums. They’re making maps for the new state quarters.”
CoinWorld’s online unit has started tracking when and where the new quarters go into circulation. Readers let the site know when they find the quarters in places like gas stations in Alabama or convenience stores in Massachusetts.
Krasny’s store has also seen an increase in customers in search of the new coins. Like many other dealers, he has started venturing online to buy and sell those and other coins, even though he says it’s now more of a seller’s market and thus difficult to find anything worth bargaining for.
His company now sells through eBay and other online auction sites while working on creating its own Web operation.
Krasny got into the coin collecting business 20 years ago when he went to work for wholesalers and retail operations. He said he had to make the move to support his own collecting habit. “I had to get into the business or I’d be broke,” he said.
In 1997, with help from a friend in the business, he decided to open A Coin Exchange in a Ventura Boulevard storefront. Since then he has tried to focus on developing an upscale image and making people feel comfortable as a way to compete with the many other dealers in the San Fernando Valley.
“You can search around for ways to grow the Internet, advertising but the basic thing is being nice,” Krasny said. “We get people who drive in from the Westside because of the service.”
