Daniel Conway got the inspiration while swimming with the “whales.”
The then-chief of staff for Sacramento Mayor Kevin Johnson was at the mayor’s side in meetings with a group of powerful financial players bidding to buy the Sacramento Kings and keep the beleaguered NBA franchise from leaving town.
“I found myself exposed to very deep pockets and to things moving very fast,” said Conway, 34. “I was very intrigued by that. It made me realize what it looks like to make things happen.”
Conway, a young but experienced political consultant and lobbyist, ultimately helped sell Sacramento City Council members on the deal to build a downtown arena and retain the Kings. In doing so, he realized he didn’t just want to be an advocate – or a facilitator – anymore. He wanted to be a player in his own right.
Johnson announced in October that he wouldn’t run for a third term. Now Conway has left the mayor’s office, after three years as Johnson’s chief of staff, to become an entrepreneur in the fast evolving marijuana economy.
Conway is the new managing partner of a startup marijuana industry investment and holding company – a firm unabashedly named Truth. The company is looking for opportunities to invest in – and potentially operate – pot-related businesses as California, which recently set new rules for medical marijuana, eyes recreational use through a 2016 ballot initiative.
His partner, Ross Haley, 36, is an entrepreneur who is the chief executive of a hydroponics supply company, General Hydroponics Inc., and a plant nutrients firm, Vermicrop Organics. The Santa Rosa resident recently sold the two companies to the Scotts Miracle-Gro Company while retaining his management posts.
Haley grew up in Nevada County and says he became familiar with marijuana and the pot growing culture at the age of 12. Yet he forbade his organics and hydroponics businesses from even mentioning the world “marijuana” to customers, even though many were using the products for cultivating buds and not tomatoes.
Haley found Conway through contacts in the restaurant industry, which Conway represented as a legislative and public affairs director for the California Restaurant Association. He struck up a fast kinship with the mayor’s chief of staff, who has a law degree from the University of the Pacific’s McGeorge School of Law and experience in lobbying state and local governments.
Conway says the partners are now “looking to play a game that doesn’t quite exist yet.”
Their Truth firm, for which Haley will serve as board chairman and Conway will run day-to-day operations, has yet to acquire any holdings in the marijuana industry. But Conway says they are looking at cultivators, dispensaries and other entities providing products and services for marijuana consumers. He says they likely won’t jump in until state marijuana regulations signed by Gov. Jerry Brown are formalized over the next two years.
While Haley says he is well familiar with the marijuana culture, Conway, who grew up in Merced and graduated from UC Santa Barbara, says simply that “I am familiar with the product” from a lifetime in California. As a veteran of the restaurant industry, he also sees new marijuana commodities and consumer venues emerging for an expanding clientele of connoisseurs seeking unique California marijuana brands and experiences.
“At some point in the not-so-distant future, this industry is going to emerge like craft beer,” Conway said. “You will be able to know from where it is created, how it is created and what the ingredients are that it is going to be a premium product.”
Haley said he settled on the Truth name to underscore that the partners will invest and participate in strictly regulated marijuana businesses, with state and local permits and no ties to the black market. Haley is the leading investor in the cannabis business partnership and Conway is a minority investor.
“His connections, his interests and his history with the city of Sacramento and the state of California made a lot of sense … for investing in Daniel to navigate the legal marijuana space,” Haley said.
Conway said the marketplace for marijuana businesses is ripe with change, and “the game that exists now is not going to be the same game in three or 10 years.”
He added: “We’re trying to be deliberate about this. But if I were to put a sign out right now, it would say ‘We’re open to everything.’ ”