Time/date: 12:30 p.m. Sunday
The gist: Award-winning journalist and author Malcolm Gladwell engaged Bill Gurley of Benchmark (a group which led the early venture investments in GrubHub, Nextdoor, OpenTable, Snapchat, Stitch Fix, Twitter, Uber, Yelp and more) in a sober, occasionally confrontational — in the politest way — and rarely humorous discussion.
The pair discussed problems with the healthcare system — especially those introduced through technology and government intervention; the economic disruption and benefits that Uber is bringing to San Francisco and the world; potential benefits and pitfalls of driverless vehicle technology; whether it’s preferable to face numerous small risks or far fewer catastrophic risks; and arms races as they pertain to data security and drug testing.
Takeaways: Both Gurley and Gladwell agreed that the health care system is messed up. Gurley cited government programs offering financial incentives for healthcare providers to implement electronic health record (EHR) programs. "The government paid $29 million for doctors to implement software they weren't implementing on their own," he said, wondering whether the software would be used beyond the level needed to assure the government payout. "That's the exact opposite of what entrepreneurs do," he said. He suggested that higher-deductible insurance programs for all but acute cases could have the beneficial effect of turning consumers into comparison shoppers. "Consumers are not price shoppers because they don't pay for health care," Gurley said.
Regarding Uber, Gurley, who is an investor and board member, called it “transformational.” he called it “probably the largest job creator in San Fransisco” and said the flexibility of the gig appeals to a wide range of employees. He cited a statistical drop in DUIs, taking an opportunity to chastise Austin’s leaders. “In Austin, where people are known to enjoy their libations, the mayor and city council here were slower than almost any other city in the nation” in embracing Uber and other alternative ride concepts. He implied that part of the safety increase that Uber provides comes simply from having fewer drivers on the road. “We just got lucky with demographic changes,” Gurley said. “Millennials don’t care about cars. There are kids who will turn 16 and won’t get a driver license. Millennials view cars as utility items, not social statements.”
On the subject of driverless cars and the relentless hype about them, Gurley is unconvinced. “I’m more of a skeptic than most people may be,” he admitted. “For a machine to be out there that weighs three tons going at that speed, any errors would be catastrophic.” Humans, he suggested, would be much more forgiving of human error causing a death than they would be of the same death caused by a machine. A driverless car, he said, needs to be a much better driver than a human.
As the conversation turned to cyber security, Gurley called white hat hacking, in which hackers are proactively engaged to try and break a system’s security and report their findings, “an elegant approach.” The other option, he said, is “putting gum in holes in the dam.”
When Gladwell classified the concept as basically embracing the criminal element, Gurley countered that companies would just be “outsourcing their security investigation to very smart people on a global basis and giving them a job opportunity they wouldn’t have had otherwise.”
Both men agreed that the concept appeals to hackers because it gives them credibility.
“Would you have an awards dinner every year?” Gladwell asked. “You could hold it in Belgrade and call the trophy the Snowden.”
Hashtag: #gurleyglad
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