Bill Gurley: Searching for Feynman

All-In with Chamath, Jason, Sacks & Friedberg

Bill Gurley delivers a powerful talk at the All-In Summit on the importance of investigative rigor and truth-seeking in the face of institut

Key takeaways

Institutional failures often stem from ignoring warnings and silencing dissenting voices.
Multiple independent investigations are essential to uncover root causes in complex crises.

Main topics

Institutional failure
Investigative journalism

Notable quotes

There's been no time in the history of the world where you can learn faster. You can increase your surface area for luck.

Conclusion

Gurley calls for renewed commitment to truth-seeking, emphasizing that

Transcript preview

Speaker 3 (0:00) Silicon Valley royalty, legendary investor, Bill Gurley. Speaker 2 (0:04) Track record's incredible. The Speaker 3 (0:05) legend who backed Uber and Zillow, who's lived through every major tech cycle for over 25 years. Speaker 2 (0:11) You're not just a commentator, right? You've been an operator. I'd Speaker 1 (0:15) love to unlock this latent human potential. There's been no time in the history of the world. where you can learn faster. You can increase your surface area for luck. I'm not a big fan of these dystopian narratives. The thing to do right now is to run as fast as you can. Please welcome Bill Gurley. Speaker 1 (0:45) It's good to be here again. Three years ago, I gave a talk on regulatory capture, and this group was quite kind in how they reacted and how that video was promoted. And I'm very happy we got that word out into the public discourse. Obviously, today you hear it quite a bit. I have a different topic I'm going to talk to you about today. I'm not going to talk about AI. Speaker 1 (1:09) It's a serious topic, and so there might not be as many fun joke parts in it. But it's something that's been weighing on my mind for the past five or six years. And I'm thankful that the team here allowed me to come to talk to you about it. And I'm hopeful that we can have an impact by getting the word out on this as well. Speaker 1 (1:28) I'm going to start by talking to you about some catastrophes that have happened in the world and how humans normally respond to them. This is the Chamberlain Towers in Surfside, Florida. You may remember in June of 2021 when the building suddenly collapsed. 98 people died. What happened? There were design errors from the very beginning. There was poor maintenance schedule. And then the board of the condominium... did not listen to an inspection report that said they needed to take care of this. Three different things. That's kind of the institutional failure. The technical failure was different, and you can see it here. This is a New York Times article. Hopefully they can push play so you can see. It's a 3D article. If they can't make it play, you'll have to watch it on your own. Here we go. But the reason I want you to see this isn't... to talk about the details of exactly how this collapsed. It turned out the pool deck was exposed to saltwater air. It corroded. The pool deck collapsed into the basement, which took out the structural columns, and the building came down. But what I want you to take away from this is the New York Times and its investigative team had excruciating detail about how this happened, which comes from doing primary investigative work. Speaker 1 (2:47) There were four other parallel investigations that happened. The NIST is the National Institute of Standards and Technology. After 9-11, they were assigned as a federal agency to go investigate what happens in a building collapse. These two individuals, Matrini Reisner and Bell, would spend five years on this. Alan Kilshimer is the wolf of building collapses. He's who you call when you want to figure out what happened. The town of Surfside hired him. Judge Randall would convene a grand jury in the state of Florida to investigate this, and there were 17 victim lawsuits which got put under a single class. Tropin was the litigant, and Hansman was the judge that did that. All of these different groups were doing investigations on their own, sometimes running into each other, sometimes helping each other out, but all trying to get at what caused the failure. One particularly heroic group was the Miami Herald. They had just gone through bankruptcy. They had a new executive editor named Monica Richardson, but they went after this hard. The beat reporter, Alan Leibowitz, was on the scene within two hours. Sarah Blaski would lead an investigative team. They would eventually find Dawn Lehman, who's a professor at the University of Washington. She would join the team. They would staff up to 37 people on this. They have a 3D model that's equally impressive to the New York Times one, and they would deservedly win a Pulitzer Prize for the work that they did. When they won it, Monica Richardson, the executive editor, who also won an award for executive editor of the year from her peers, said, we will continue to investigate the collapse to find answers to how this happened to ensure a tragedy like this never happens again. Now, Finding the failure cause doesn't help if you don't prevent. This is a list of some of the changes that went into all the condominium rules in Florida. And thankfully, multiple other states, especially coastal states, adopted them. So you have change that causes prevention. That's what you want to have happen when these things happen. 737 MAX crash. Unfortunately, there were two crashes, October 2018 and March 2019. For those of you who don't know what happened, let me give you the really short version. Airbus had come out with a plane that was incredibly fuel efficient, and they were starting to take share from Boeing. Boeing wanted to respond. If they built a new plane, it required tons of hours of teaching and training, and that makes it harder to sell. So they decided they would attach a fuel-efficient engine to an old plane, the 737. That's how you get the name 737 MAX. The problem is the engine was too big and they had to move it forward on the wing. When you move it forward on the wing, the plane is imbalanced. And they had this problem during test flights when it would occasionally tip up. So they wrote a piece of software, secret software called MCAS, MCAS, and they put it in there without telling anybody. And if the sensor went off and told them the plane was tipping up, the autopilot would push it down. The poor pilot that was flying the Ethiopian Airways flight, his sensor malfunctioned. The software thought that the plane was tilting up and it pushed it into the ground. That's what happened. Speaker 1 (6:11) There were many people that investigated this. I call them the six searchers. The U.S. government did a Senate commission, a House commission, and the DOJ went after it. KNKT is the Indonesian firm or the Indonesian agency that had the right to inspect the black boxes. They could tell very quickly the pilot was fighting the autopilot. The press played a key role. Dominique Gates had followed Boeing for the Seattle Times for 16 years. He would win a Pulitzer for his work here. Peter Robeson wrote a book called Flying Blind. You can tell why it would have that title. Fifty-seven whistleblowers sent letters into the Senate to tell on Boeing. The victims' families showed up and were ever-present and put pressure on Congress to make sure something happened. And the head of the pilots' union was very upset that they had put this piece of software in there and not told the pilots. Boeing tried to come have a sit-down with the pilots' union, and they secretly recorded what Boeing said and gave it to the press. And then when they wouldn't respond to Boeing's request, the pilots' union issued FOIA requests against Boeing. It's unheard of. Now in these situations where you have six searchers, you also have blockers. And unfortunately in this case, both Boeing and the FAA were being unhelpful in trying to find out what happened. Boeing initially accused the pilots of not being trained well enough. The FAA refused document requests to the Senate panel. And one thing I would tell you about these big organizations, when you put a spotlight on them, they can feel the weight of that spotlight and they circle the wagons. I think part of it's institutional. I don't think they're necessarily evil. They're just, they have a sixth sense about how to respond when they're put on the spotlight like that. The other thing that's interesting here is a lot of people came to think that Boeing and the FAA were working as one. Senator Ted Cruz. when he had the head of the FAA in front of the Senate, literally accused him of being captured. There's our favorite word again. And he even said to him, sir, do you know you don't work for Boeing? One of the real failures here in this case, 45 days after the first crash, almost everyone knew the MCAS software was at fault, and no one grounded the plane. Boeing didn't ground the plane, the FAA didn't ground the plane, and the second crash, I mean, the first crash should have never happened because that piece of software should have been identified, which would have required retraining, but the second crash should have really never happened. Speaker 1 (8:54) I wanted to share with you, I don't want to go through this in detail, but these are the two different committees in the House and the Senate, and I just want to highlight that they were decidedly bipartisan. DeFazio was the head of the House committee, very active. Ted Cruz and Wicker were super active. No one thought this was anything that should be partisan, nor should it be. Speaker 1 (9:14) It turns out the scientific community has a process they use when they want to do failure analysis. It's called CAPA, Captive and Preventive Action. And there are five steps. You detect, you investigate, confirm root cause, correct, and prevent. And it's