Prelude to the Millennium Sapphire: Daniel McKinney’s Background in the Gemstone Industry
Interview by Angeline Mbogo
The Chairman and CEO of Millennium Fine Art, Inc. (MFAI), Daniel McKinney, was in the gemstone industry long before purchasing the Millennium Sapphire in 1998. This article goes back in history to reveal the career that was a precursor to the Millennium Sapphire and MS token projects.
It All Began in the 80s
After studying Medicine and working for two years as a surgical assistant in a medical center in Houston, McKinney returned to Hong Kong, where he established a small gem cutting factory in the New Territories in 1982. The factory dealt primarily with semi-precious stones like amethyst, topaz, garnet, and lapis. Sometimes they would also cut sapphires, rubies and emeralds.
His first clients were gemstone companies in Idar Oberstein, Germany, the capital of gemstone cutting in Europe. They were interested in block services, and they started sending him half and 1-kilogram preform bags of rough, which he would facet and polish and dispatch back to them. The clients then supplied the cut gemstones to international markets.
“I learned how to cut that way,” McKinney explained.
In late 1982, McKinney conceptualized the first Hong Kong Gem and Jewelry Show, pioneering the exhibitions business in Asia. The show took place at the Sheraton Hotel in Hong Kong in early September 1983, attracting exhibitors and clients from across the globe to purchase and sell gemstones and jewelry. The show, which was the first large exhibition in the region, was a huge success. McKinney ran the exhibition company for two years before it was taken over by Headways Limited. The company continued to grow, becoming one of the largest and most important jewelry exhibitions in the world.
Around 1983/84, he was introduced to Richard Talheimer, who had a catalog business called Sharper Image. The San Francisco-based company was the cool place to buy nouveau types of products at the time. McKinney started producing pieces of jewelry in volume for Sharper Image. Some of the designs he did for Talheimer were a 14-carat rainbow bracelet line in various color gemstones, pearl necklaces and chokers.
“That was really my big first taste of success in the jewelry business with Richard’s Dad, Alan Talheimer,” said McKinney.
The jewelry division of Sharper Image was in Little Rock, Arkansas, where the then-Governor Bill Clinton was based. “The Talheimers had connections with him, and it was all quite interesting. I have several stories about Bill Clinton when he was Governor at the time there, but that’s for another blog,” he added.
Designing Jewelry and Supplying Carvings to the Connally’s
In 1983, McKinney became associated with John Connally, who had negotiated a deal for Lyndon Baines Johnson (LBJ) to join the Kennedy ticket as a Vice President-to-be. Connally also ran all of LBJ’s campaigns at the Senate and Congress.
Kennedy and LBJ won the election, and Connally became the Secretary of the Navy. He then resigned and successfully ran for the Texas governorship. During his tenure as Governor, Connally remained closely connected to President Kennedy and Vice President LBJ. In November 1963, he invited them to campaign in Texas ahead of the Presidential election the next year. It was during this time that President Kennedy was assassinated. The bullet that killed President Kennedy hit Governor Connally as well. Connally was elected the Governor of Texas three times.
In November 1983, Connally and his wife Nellie visited McKinney in Hong Kong. It was the 20th anniversary of Kennedy’s assassination, and they were anxious to elude the routine press interviews. The Connally’s stayed at the Regent Hotel in Kowloon, and McKinney had the unique opportunity of being invited for a nightcap at their hotel suite to see the new Life Magazine about the assassination. There, he learned more about their inside individual stories about the Kennedy assassination.
“This was a most fascinating evening and interesting time, to say the least. Obviously a taboo subject, I was able to have a Q&A session about the whole incident as they were freely talking about it,” he revealed.
During their stay in Hong Kong, McKinney was their tour guide. He got an unlimited budget to buy sample Chinese antique vases, carvings, and other antiques for the Connallys. Thanks to his knowledge of Cantonese, McKinney was able to run this shopping errand swimmingly. Connally sold these antiques through his art galleries throughout the Southwest.
From that point onwards, McKinney started supplying Connally with large carvings of malachite, lapis, jade, ruby zoisite, and other gemstones. Connally would then sell these carvings to his retail clients through his art galleries. Connally also ordered large unique jewelry pieces, which McKinney designed for his wife Nellie. One of the pieces that stand out was a large natural South Sea Pearl necklace that McKinney found in Hong Kong and designed for Nellie. Texas Monthly magazine featured the necklace on the front page after Nellie wore it to a prominent ball.
“That’s how I got into the carving business,” McKinney said, adding that Connally was his mentor in business and one of his most significant clients.
In the late 80s, McKinney purchased an aquamarine crystal that was about 30 pounds. The crystal was carved into a Chinese mountain scene in Guilin, a process that ended around 1988 (it took two years). One of his agents sold the carving to Borsheim Jewelry in Omaha, a company owned by Warren Buffet.
The Government of Madagascar invited McKinney in 1991 to offer pro bono advice related to the value-added gem business for a few months. They were interested in expanding their nascent gemstone and jewelry industry. Also, they wanted to create a second tax-free “Hong Kong” in a city called Toamasina. McKinney brought on board several prominent people. For instance, he connected the Government of Madagascar with some people from the World Bank and Thomas Bookwalter. Bookwalter had set up several stock markets around the world like the Johannesburg and Amsterdam exchanges. It was at that time that McKinney met the monopolies dealing with various gemstone rough and established contacts that enabled him to later buy the Millennium Sapphire.
Enter Millennium Sapphire
McKinney bought the Millennium Sapphire in January 1998. He received several unusual design suggestions, including carving the bust of the Queen Mother on the Sapphire. Ultimately, he came up with the idea of making the Sapphire a tribute to the high points of human civilization over the last 5000 years.
“I had a construction business in Bangkok from 1990 to 2000. In 1996, I started getting nervous about the economy there and having to give so much credit to my big developer clients. So I pulled in all the credit. When 2 July 1997 came around, I was all cashed up. Therefore, I was able to be the lead partner of the consortium to buy the Sapphire,” he said.
“Whereas if you were trying to buy a gemstone for $30 million, the way it worked in Thailand is you put up like $3 million, then you borrowed $27 million from the bank. By August of ’97, all the banks in Thailand were insolvent, so selling the Sapphire in an auction in ’97 was not possible, so they canceled it. I was one of the few people with cash, and so I negotiated and closed on the deal and actually bought the Millennium Sapphire in January 1998 with the consortium.”
McKinney traveled around the world in 1998 interviewing the top carvers and designers. That was when he stumbled upon Alessio Boschi, who had completed a six-month consignment in Greece and was going back to Italy. He contacted Boschi and commissioned him to undertake the Millennium Sapphire project for three years.
“When I met and started talking with him, I thought he was the incarnation of Michelangelo. The guy is a genius. He’s an absolute artistic genius. He’s an amazing person,” McKinney stated.
After flying Boschi to Hong Kong, they spent six months together researching, sketching, and training the carvers for the project.
“In fact, in 1998, I was already coming up with the first NFTs because I wanted to come up with a treasure trove of content and ideas and personalities and places that we could use in the future. Of course, I had no idea about the advent of the blockchain or the NFTs, but I knew somehow in the future we could use this treasure trove of faces and personalities in different subjects,” McKinney disclosed. “I didn’t do the Queen Mother or some other single subject piece for the Sapphire. We did 134 figurines. This was just laying the platform for the NFT business. This was absolutely the perfect thing and the perfect way to do this NFT business, and that’s how we got all these copyrighted and treasure trove of figures.”
Look out for our interview feature with Alessio Boschi. Don’t miss this exclusive by following us on Medium!
Also, are you curious about the Millennium Sapphire NFT series? Learn more on the MS Token website.
Read about our first NFT, Sputnik 1, in this guide.
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