#376 Jensen Huang: Founder of Nvidia

Transcript from https://podmenti.com/t/af9eff29c460da69


Technical skill and maximum effort above all. And as I was reading, I noticed a lot of similarities between
The way Jensen thought and ran his company.
With the way that Steve Jobs and Jeff Bezos thought and ran their companies as well.
From day one in Jeff Bezos' very first shareholder letter, Jeff wrote
About the importance
And emphasize the importance of having the very best team. He wrote setting the bar high and our approach to hiring has been
And will continue to be.
The single most important element
of Amazon's success.
Jeff's focus on talent.
Is
very similar to this quote that I found from Steve Jobs.
In an interview that Steve gave that very same year in nineteen ninety seven, and this is what Steve Jobs said.
He said that I think I've consistently figured out who the really smart people were to hang around with.
You must find extraordinary people. The key observation is that in most things in life
The dynamic range between average quality
And the best quality
Is at most
Two to one.
But in the field that I was interested in.
I noticed that the dynamic range between what an average person could accomplish and what the best person could accomplish was fifty.
Or a hundred.
to one.
given that you're well advised
to go after the cream of the cream. He says you want to build a team.
that pursues the A plus players. And this is exactly
What Ramp did.
Ramp has the most talented technical team.
in their industry.
Becoming an engineer at Ramp is nearly impossible. In the last twelve months, they hired only point two three percent of the people that applied.
When you use ramp.
You now have top tier technical talent and some of the best AI engineers.
Working on your behalf twenty four seven.
to automate and improve all of your business's financial operations, and they do this all on a single platform.
That means the longer that you use ramp, the more efficient your company becomes. This is important because as Sam Walton said in his autobiography.
You can make a lot of different mistakes and still recover.
If you run an efficient operation or you can be brilliant.
And still go out of business if you're too inefficient.
Ramp helps you run an efficient organization.
In the end of that interview that Steve Jobs gave, he added
A small team of A plus players.
Can run circles.
Around a giant team of B and C players from a customer's perspective.
What does it sound like when you have a small team
of A plus players. It sounds like this customer review that I read.
Which said that ramp is like having a teammate
Who you never need to check in on.
Because they have it handled.
Ramp gives you everything you need to optimize all your financial operations on a single platform.
Ramp's website is incredible. Make histories
greatest entrepreneurs proud by going to ramp
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to learn how they can help your business today that is ramp.
Dot com.
So the book that I want to talk to you about today is the Navidia Way Jensen Wong and the Making of a Tech Giant.
And it was written by Tay Kim.
The book is a company history.
Of NVIDIA.
But that is not what I want to talk to you about. I wanna talk to you about
How the founder Jensen has learned to run his company.
After decades of experience and learning
And practice
and failure and pain.
And so there is nineteen different ideas.
That popped out to me.
And they're like reoccurring themes and I think they
To steal an idea from from Charlie Munger. Charlie Munger has this
idea that he talks about over and over again. He talked about it over and over again for decades.
He talked about the Lollapalooza effect.
And how there's these economic and social implications
Oh
These
Different ideas inside of a company that interplay with one another.
And the combination of them actually make
The
the traits more powerful.
And in typical Charlie Munger fashion, he said
The person, the man who doesn't understand this is a damn fool.
And so I organized my notes into this list of nineteen ideas that I learned from Jensen specifically how he runs his company from reading the book.
Before I get there though.
I gotta take another idea.
Munger where he talks about the importance of

He says that when you're trying to teach the great concepts that work, I think it helps to tie them
Into the lives and personalities.
of the people who develop them. So I before I get to my list of nineteen ideas, I want to give you this brief overview of
Jensen Wong's early life
And then the prehistory of Nvidia.
And I think doing so will add context because Jensen runs NVIDIA in a very unique way. He has built
which I think all of uh he has in common with a lot of history skrenkers. He built a company building philosophy
That is natural and authentic to him.
He's been running the video for over three decades, and it's I think it's impossible to do something for such a long period of time unless it is natural and authentic to you, so
The the one of the most important things
That happened in Jensen's life.
Happened when he was four years old. He was born in Taiwan.
His father
visits America, he goes to New York City and he realizes oh
This is the land of opportunity.
I want if I want the best opportunity for my two sons.
I need to get them to America. And doing so had to feel
Like a daunting task.
To his father. Jensen's family.
Did not have money. In fact,
They didn't even have a lot of stability. They had to move around.
Taiwan.
Depending on where his father
Could find work.
They did not.

Did not speak English. In fact, I thought it was very fascinating how Jensen's mother decided, hey, they the kids need to go to America.
And if they're going to America they need to to to learn English.
And so she would select ten random words from the dictionary every day.
She'd make her sons
uh memorize the definition and learn how to spell the words. So ten
English words every single day.
And so in addition to reading this book, I watched a bunch of interviews with Jensen and he talks about the fact that he has he feels a great debt, the fact the sacrifices that his parents made
to give him access to essentially unlimited opportunity. One of the great things about reading, you know
This is not technically a biography of Jensen, but it can function as one.
And one of the re the reason I become of an evangelist for
uh you know, reading biographies and I try to get people to read as many as possible'cause
You're not really yes, we're studying
And we're learning about the lives of other people, but it is natural, it's human nature to
Put yourself in their shoes and think about how
Their story or their ideas relate to your own.
And this was you know, actually
Surprisingly
It hit me like an emotional
Point because I was just thinking about the fact that
You know, this is outside of Jensen's control. He's four years old.
When this is happening.
And yet the decisions that were made before
Jensen even had a memory.
affected the entire trajectory of his life. And I I thought about the fact that
My paternal grandfather
was born in Cuba. He died.
Before I have no memory of him.
He died when I was really young, I I think I was actually four.
As a matter of fact, maybe even younger.
And yet
I owe the the the like the entire trajectory of my life
We change
By a decision.
Of an uneducated
relatively poor
Man.
Who was
Living in Cuba.
He was thirty eight years old.
He was
working any kind of job. He worked as a butcher and as in a in a factory that made shoes.
You know, the who's not a prosperous man who's not an educated man.
He was married.
He had a baby.
Okay.
A two year old.
There's my dad.
And he Castro takes over and he decides.
Somehow he knew he's like this is really bad. I have to get out of here.
He winds up fli Imagine living your entire life in a country.
You're thirty years old.
You have a wife and a kid.
You don't have any money, you don't speak the language.
And you just and you take that risk and you come to America and that decision based on somebody
I don't have any memory of.
Change the entire directory of my
Of my life.
This is un the the luckiest, the kindest thing ever anybody's ever done for me.
the luckiest break ever had in my life. And I think there's a lot of similarities between
The what his parents are willing to do.
Jensen's parents are willing to do the fact that
They send
They're they're
Sons, imagine sending your kids they send Jensen and his brother to Washington, to Tacoma, Washington.

their aunt and uncle before they can get over to America themselves. And then what happens?
They just said, Okay.
My my our boys are here.
We know they need to get a good education. We're gonna send them to an American boarding school.
Okay.
This place called Onita Baptist Institute, which is located in Kentucky.
To pay the tuition.
Jensen's parents.
Sell off all their possessions.
Now here's the problem.
It's not a prep school. It's not a boarding school.
I mean, technically boarding school.
But they thought the family thought it was a prep school.
It is a school, a reform school for troubled young people. So
Really the reason I I wanna add this like extra context for Jensen's early life for you.
Is because I think this entire section
And all the notes and stuff that I want to talk to you about and before the the founding of NVIDIA.
And really the first like ten years of the video too, you could really summarize it by one of my favorite maxims in the history of entrepreneurship, and that is
Excellence is the capacity to take pain.
Jensen.
Has
Unfathomable levels.
I can't I I've not discovered the end of his capacity to take pain. He talks about this a lot. So there's two things that actually happen at at at the reform school I think are really important. One, the school holds the students to a very strict routine.
And you have to work every single day, which Jensen does.
And loves to do now.
Uh the other thing that was beneficial to him that probably didn't feel beneficial at the time is that the first few months Jensen was smaller than smaller and younger than than all of his classmates.
And they beat the crap out of'em.
His roommate at the boarding school.
was eight years older than Jensen, and they said there's a great description of him in the book that he's covered in
And tattoos and s and scars from stab wounds.
And so w after getting his ass kicked a bunch.
They wind up like finding his footing, ga gaining respect. He's obviously somebody that's that's not gonna back down.
From a fight.
And Jensen much later on in life is talking about this formative experience.
uh going to the school and he says as a result of this experience, I don't get scared.
I don't worry about going places I haven't gone before. I can tolerate a lot of discomfort.
So then the other the next thing I want to talk to you about is I wanna fast forward.
And at this point we find
Jensen is
already graduated college.
He is working
For a microchip company. It's AMD, Advanced Micro Devices.
And this is just his capacity to take pain.
His uh he's got large uh I I would say he's got a lot of endurance.
And you know, he's got a a phenomenal work ethic.
And so by day he's designing microchips at AMD.
And at night and on weekends he's married and has two kids, by the way.
So she's got a young family.
He's got a
Well, a full time job.
And he decides he wants to go to Stanford, he wants to get a master's degree. It's gonna take him eight years to finish his master's degree because he can only go on nights and weekends.
And and spare time while he's working and then raising his very young family. But again, he took away a very valuable lesson. He says, I have a very long term horizon.
I can be impatient about certain things.
But infinitely patient about others.
I plug away.
And so here's another example that excellence is a capacity to take pain. Everywhere that Jensen works, everywhere he goes, people realize he's really smart.
And then he winds up getting promoted.
Rapidly, almost everywhere he's at.
And he there's this line in the book that's fantastic. It talks about
Like why does he think that he was able to be propelled from scrubbing toilets to managing entire divisions of microchip of a microchip company?
And he believes it's his willingness and ability to put in more effort.
And tolerate more suffering.
Than anyone else. And again, this is something he repeats in a bunch of the interviews I watched with him as well. He says people with very high expectations have very low resilience.
Resilience matters in success, Jensen said.
Greatness is not intelligence. Greatness comes from
From character and in character in Jensen's view.
It can only be gained
And actually earned.
As a result of overcoming
problems, setbacks, adversities, and refusing to quit. Perseverance is one of
I think Jensen's most valued traits. And it is also advice that he doles out. So if you were to ask Jensen,
What is your advice on how to achieve success? His answer is relatively consistent over the years.
He says I wish upon you ample doses of
Of pain.
And suffering.
So I wanna get into a very important part of like the prehistory of NVIDIA.
And Jensen is working at this company.
Called LSI Logic.
And there's a few I uh actually there's three important things.
that jumped out at me that I think were important for the time that Jensen's
uh that Jensen spent at LSI logic. One, he's gonna pick up this maxim that he'll repeat throughout as he's building NVIDIA. It's called honing the sword.
And it's the idea that and again, this is something that Jensen has in common with Jeff Bezos.
Steve Jobs and a bunch of other people, but I'm gonna give you two examples there.
You should seek conflict if you're working on something you care about.
Don't avoid
Confrontation.
You actually seek conflict. And Jeff Bezos said the greatest example of this. He says, If I have to choose between agreement and conflict, I'll take conflict every time. Why?
Because it always yields
A better result.
So they're having these explosive
Fights and arguments.
inside of like what what to build, what direction, how to run the company.
And he realizes that out like it might be temporarily uncomfortable to go through that experience.
when it's happening, but on the other side of that.
is a better
idea a more
refined idea. So the reading reasons obviously called holding the sword. Holding the sword. How do you sharpen a sword?
You you hit it against a wet stone a wet stone.
And doing that over and over and over again.
Um creates a sharper and a better
Sword. This winds up becoming one of his main philosophies and one of the nineteen things I want to talk to you about when we get there. But
Again, every time I read anything.
Uh it could be a book.
uh an article, a tweet, I always think about like how does what I'm reading now relate to all the other, you know, three hundred and seventy five
other books that you and I have studied on this podcast together.
And so honing the sword
actually reminded me of Steve Jobs Rock Tumblr story. So there's this great interview. I think it's called Steve Jobs The Lost Interview.
Think t occurred right before he went back to Apple.
So it's right right around nineteen ninety seven.
So he tells a great metaphor, Steve, you know, master storyteller.
has a great metaphor for teams working on a product that they are passionate about. And this is what Steve said.
There was an eighty year old man that lived on my street.
One day he showed me a dusty old rock tumbler.
We took regular old ugly rocks and some liquid and powder and put them in the tumbler.
And he said to me, Come back tomorrow.
The next day
We opened the can.
We took out these amazingly beautiful polished rocks.
The same common stones that had gone in
They're rubbing up against each other, creating a little friction, creating a little noise.
had come out these beautiful polished rocks.
It is through a group of incredibly talented people bumping up against each other.
Working together.
They polish each other.
They polish.
their idea. So
The first thing that happened when he's working outside Logic.
Yeah.
grabs this one philosophy that he's gonna use, you know, for
Multiple decades into the future.
The second thing.
Which is m arguably the most important thing.
Is this is where he's going to meet.
His future.
Co founders.
And there's another maximum I want to put into your brain.
that reappears over and over again in the books all the time.
Opportunity handled well.
leads to more opportunity. So Jensen is working at LSI.
Right.
And he's a sign.
The Sun Microsystems account. He is going to meet there's two gifted programmers.
And engineers.
Uh Jensen said this, you know, this is one of the luckiest things ever happened to him. The fact that he met Chris Malachowski and Curtis Priem. These are going to be his co founders.
So
He is their liaison between Sun Microsystems where they work and
LSI where Genser works. And so Chris and Curtis actually get upset.
at Sun Microsoft, they decide to leave and they have this idea that they want to be
consultants and advisors.
They wanna tell they wanna touch a pitch Samsung.
on taking one of their ideas.
And they're like, Hey, we'll just, you know, design it. We'll be consultants for them. And they're like, Wait a minute.
We're like really good technologists. We might have a lot of technical brilliance.
But we don't know anything about contracts or business really.
We need to get somebody to help us and they're like, who's the best person that can help us?
And they loved working with Jensen so much and they thought he was so brilliant. They're like, Oh, we immediately reach out to Jensen. So originally Curtis and Chris are like, Hey, can you help us like write this contract for this idea that we want to pitch Samsung? We want to make sure we don't get screwed over.
They start meeting and
Eventually Jensen's just like well
Why are we doing this for them? Why don't we start our own company? And that's why I think it's so important to repeat over and over again that opportunity handled well.
leads to more unexpected opportunity you could never possibly predict the fact that
You know, every single job that Jensen does, he does the best possible job he can.
And that as the time passes, as you go as you read the book, as you go as his life unfolds.
That the fact that he handled the opportunity the best, he did the best possible job he did unlocks all these other opportunities. I remember
There's actually a great way to to to think about this and one way I think about this all the time, like if you hear my own inner monologue
Um
There's this basketball player, he's a young basketball named Anthony Edwards, and
he plays for the Timberwolves and they were like really outperforming what people thought they were gonna do.
in the playoffs and I heard one of his I saw a clip of one of his
postgame interviews. And I thought what he said was fantastic. And he had a very Anthony Edwards had a very simple
Like oper like modus operandi or wait approaching, he's like, Hey
I'm just trying to kill everything in front of me.
I'm just trying to kill
Everything in front of me is another way of saying that.
Whatever opportunities in in front of me, I'm gonna do the best damn job possible.
And if I do that every day.
That
Opportunity handle well is going to lead to more unexpected opportunity. Now that also combines with another Maxim that you and I talk about.
The relationships run the world.
So
Jensen's working for LSI.
Okay, he goes to the CEO, Wilfrid Corgan.
And he's like, Hey I'm gonna leave.
I'm gonna do this this business with Curtis and Chris.
And
What is LSI CO, the first thing he says.
Can I invest?
'Cause he's like you're you're
Brilliant. You're one of the smartest people at this company.
And this this is the third reason that I wanted to talk about
Jensen's
time at LSI Logic and how it was so important to the prehistory of N video because
What is
Corgan do.
Corrigan actually
Introduces
Jensen to Don Valentine, the founder of Sequoia.
And Sequoia and Valentine had invested in LSI. Now here's the reason I say opportunity handle well, at least uh more opportunity.
And relationships from the world.
When
Cor Wilford Corgan calls Valentine. He's not saying hey, you should this these guys wanna make graphics.
cards or they wanna do th what it he didn't even pitch'em the startup idea.
He pitched Jensen. He's like, Hey
This guy wants to start his own company?
He's really smart. He is really good.
You guys should go talk to him.
Now.
This is the fascinating thing.
Uh because not only did
Like Jensen gets this gets his introduction.
Based off his reputation.
Jensen talks about this and something you and I will talk about later, too. And I think again, another trait. I hate to repeat myself, but I have to because I think it's a repetition is persuasive.
It's really important.

Jensen has so many traits. He fits right in with all the people that you and I study. And one of them is this fierce habit of self.
Criticism.
of never thinking anything is good enough. And so Jen and there's tons of highlights are quotes of the book.
Where Jensen's just like I I suck.
I cannot believe I did that.
And he talks about the fact
That
When he goes and pitches.
what's gonna be NVIDIA to down Valentine. He's like
My pitch.
Was horrendous.
Uh I didn't I couldn't explain what I was building. I couldn't say who I was building it for.
I couldn't even tell him why I was gonna be successful.
And yet the end of the meeting, Sequoia decides to invest. And there's a great quote on Don Valentine in this. He goes against my better judgment.
Based on what you just told me. Obviously, it's a crappy bitch. I'm gonna give you my money.
But if you lose my money, I will kill you Valentine told him.
And so Jensen's like listen
the the important takeaway here, again, he goes to school on everybody, so your repetition reputation will precede you.
Like
They succeeded on the strength of your reputation, not their business plan.
Not their pitch.
And
This is a very important point because
I always think of
What
Th there's a line where like but if you if you go and read
Buffett shareholder letters and you go and watch his the way he answers at the AGM, and you can go see these YouTube videos where he actually testifies in front in front of Congress.
You'll see that Buffett for probably four over four decades talks about the fact that
You're you you have to be very in
You should be making all your decisions.
That protect your long term reputation in mind. In fact, when Buffett is testifying in front of Congress.
when that he was going to the Salomon Brothers scandal, he talks about the fact that he told he's telling the Congressman
That he told everybody inside.
the the organization that if you lose
You can lose money for the firm?
I won't be understanding.
You lose.
a single shred of reputation and I will be ruthless.
He put that into the congressional
Record.
And he again, I I think he talks about the fact that
You know, the reason is is because if you're making decisions
with the importance of your long term reputation in mind.
That's gonna pay dividends and it can also destroy and
and and abort operate opportunities if you have a bad reputation. Jensen says the same thing.
It's like it is a lesson that Jensen would never forget.
Your reputation will precede you.
Obviously it it pays dividends in business.
I was thinking about this with Brad Jacobs. I became friends with Brad Jacobs as a result.
of this podcast.
Brad is on his I've lost count. Eight.
Nine I think he's on his ninth separate billion dollar company.
And when I'm reading this part when I got to this part about
about Jensen. I was like, you know what?
Brad Jacobs could do a horrible job with a pitch too.
Yep, because of his track record.
Because of his reputation, the fact that his great reputation precedes him
If he's starting a new project or he wants to raise money for his new company, he's gonna have a line
Out the door.
Around the block and down the street waiting for people to invest in him and his next idea.
Because of that track record, because of that reputation.
So
There's just a few more things before we get to this list of nineteen ideas that I want to spend the the hopefully the bulk of the conversation you and I are gonna have today. But
I do have to get to the beginning of NVIDIA because it's funny he describes this because I went back and actually looked at like the financial performance of NVIDIA and the market cap.
It is almost like
the this harshness that that that that Jensen applies to himself, which
I think is a good idea.
If you're listening to this, you probably do this. I definitely do this to myself. But he kind of describes the first fit.
Five to fifteen years of the company is like just a series of fuck ups.
And I just want to get to

of Well I'll I'll just give you some background, quick.
Their first plot product, right?
is a flop and
It's called the N V one.
And so Jensen is actually doing like this post mortem.
And he'd realize they they made several critical mistakes with the M B one.
And so I'm gonna read a section from the book.
To you.
So some of these critical mistakes from the enemy one.
Starts from positioning.
To product strategy.
Says they had over designed the card.
Stuffing it with features no one cared about.
The market simply wanted the fastest fastest graphics performance.
for the best games at a decent price and nothing else. The N V one could simply could simply not stack up against other cards that were more narrowly designed.
This is what Jensen said.
We learned it was better to do fewer things well.
than to do too many things.
Nobody goes to the store
To buy a swish.
Army night.
It is something
That you get for Christmas. So
That's an idea that James Dyson realized. So
I my number one recommendation for all out of every single book that I've read is still James Dyson's
first autobiography called Against the Odds because
The entire book is just fourteen years of struggle.
It's James making every single mistake the possible that a young entrepreneur can make.
It's him persevering.
And enduring through five thousand one hundred and twenty seven failed prototypes. But James realized the same thing when he started building products, and he has a great line.
in that book that describes what Jensen's teaching us at this point in NVIDIA's history and he says people, this is what Disa said.
People do not want all purpose.
They want high tech
Specificity.
Another lesson Jensen learned from this.
He was embarrassed.
The fact of how little he did not know again, he is ruthless.
Like the the self criticism, he's really ruthless of himself, but
I think there's a there's a benefit because it's it's forcing myself to learn.
And this is something he's gonna apply. This this public criticism that he's known for.
in building the video.
So he was talking about the fact that one of the first board meetings, he on this N V one almost
Killed the company.
And yet at the board, one of the board members was asking he's like well
How are you going to position this?
And this is what Jensen said. He goes, he asked me a simple question and I had no idea how simple it was.
And it was impossible for me to answer because I didn't understand it.
The answer is supremely deep.
You'll spend your whole career answering
That
question.
And again, the the issue was that NVIDIA's message with the MV1 was far too complicated. He didn't put enough thought into how you position it. What's very weird about product positioning.
is everybody comes up with their own definition of it.
I think
David Ogy's definition that he wrote in like 1965 has not been approved on. Improved on. I still think it's the best.
Simple way s simple way to think about how to position your product.
And so David Ogee's definition of product positioning is simple.
It's
What the product does
And who is it for? There's a great line that the author Take him
wrote in this section that I think is beautiful. It says seduction
requires a simple
Message.
the the marketing and the positioning.
of the N V one was far too complicated. And and also Tay
I g I gotta s thank Tay as well. He s he sent me a bunch of supplemental material.
To help me make this podcast. And Tay wrote an absolutely fantastic book because it gives you this insight into the unique mind of Jensen. Jensen does not shy away from how bad he was during this this period. He talks about this. Here's another quote from the book on the early days in NVIDIA.
We were just bad at our jobs.
The first five years of our company, we had really talented people working super, super hard.
But building a company
is a new skill and that is why
You know, the the value the the main value I got of the book is that
We we're able to benefit.
In the fact that Jensen learns he's going to adjust.
You'll see in the future his maniacal working habits. He picks up all these ideas about the dangers of complacency, the importance of having a flat, fast organization.
He's got a lot of new ideas on how to run NVIDIA and he wouldn't have had them.
Had he not gone through
The painful and tumultuous time.
in the company's early history. So
Their first two
Products.
Fail.
They got mass layoffs.
They're in a cash crunch.
Uh go goes back to again, do you want to be great? Well then I wish you pain and suffering. He's speaking, he's giving advice that it had benefited him.
And again, I I think all the the the the this the these failures that happen is like
You see him developing his endurance.
You see him.
Devel developing his pain tolerance.
'Cause it's impossible to run a company for thirty years.
And not confront and dur.
And overcome.
ad v adversity.
And discomfort is just not gonna happen.
So at this point in the company history
Jensen has to lay off. He has to do mass layoffs. He goes down from over a hundred employees to down to forty.
And Jensen also realizes that NVIDIA's not gonna be able to raise more money.
So in the words of Jeff Bezos, what did it do?
They have to invent their way out. They need to create a great product.
And sell it.
The third product they're making is called Riva one twenty eight.
And since he's running out of money, he realized hey, I we have to shorten the amount of time it usually takes us to build a new product.
One way to do that is to actually shorten the testing cycles. So let me read this from the book.
Jensen heard about a company, I think it's called Ecos.
uh the made machines that enable engineers to run tests on digital chip prototypes.
Bypassing the need to make an actual chip for testing.
And thus saving time.
But an ecos machine cost a millian dollars.
And would cut NVIDIA's runway.
From nine months down to six months.
But Jensen realized it would speed up the testing process.
By significantly more
Time.
That saved time actually saved the company.
Because this third product was a success and then you see that Jensen's
has he's a very good salesperson, he's very charismatic, he's got a showmanship to him.
And so let me give you an example.
Once they
Page.
They build a Riva one two eight.
He gathers all of the entire company, which not many people left.
in the company cafeteria. He pulls out a piece of paper from his pocket.
And he reads off
A dollar amount.
It is a small dollar amount.
And then he folds the paper back, puts it in his pocket, say, Hey, that's how much money we have in the bank.
That's not good. The room was like oh shit.
We're in big, big trouble. And then he pulls out another piece of paper from his pocket. He opens it up and he goes, One purchase order
From S T B systems.
For thirty таusen юniць.
Of Riva one twenty eight.
And the entire company.
Erupted in cheers.
Okay, so I say all that really to say this. This is
Now those list of nineteen recurring ideas that I think
connect and interplay with each other.
And it's really like again, how Jensen what has Jensen learned.
uh on how to run a company and how to build a company.
after decades and decades of experience and learning and practice and failure and and pain.
And the very idea number n one out of the nineteen.
Is Jensen as a teacher.
So I want to start here because
The very first sentence in the book.
Is in another life
Jensen.
might have been a teacher.
That of course is gonna mean a lot to you and I because
A commentary of history sounders.
Is the fact
That they spend a lot of their time teaching their organization. So I actually went
and talked with Sage about this or prompted Sage about this.
And there's a great a lot of great examples. So
Many of the great founders
saw themselves primarily as teachers.
Yeah, people like Sol Price, Henry Singleton, Warren Buffett, Bill Walsh.
Steve Jobs.
Jim Sinegal, the founder of Costco, who was a mentee of Soul Price.
has the best quote on this. He says if you're not s as a leader of the company
If you're not spending ninety percent of your time teaching
You're not doing your job.
And so one of the ideas that Sage reminded me of that I forgot is that
Yeah.
Cynical learned that from Sol Price. Sol Price had this idea of
W like why are you teaching? What are you actually doing?
And he says you actually the best leaders create alter egos through teaching.
the end result of the leader teaching all their employees to become alter egos. Now you have somebody that can understand and perform their jobs as well as well as are better.
than the owner or the leader of the company would.
This is why I think distilling things down to a list of principles or a handful of maxims is so common and so important because
Essentially what the leader of the company is doing, what Jensen's doing, is you're continuously teaching and reinforcing your company philosophy.
And the values.
over time by repeating the principles and the maxims.
The great founders essentially become evangelists who relentlessly teach
about the company's mission.
And their values.
And in fact the people that work with Jensen, they call him Professor Professor Jensen.
And they talk about the fact that he has a very he's he's a he's really good at explaining complicated concepts in a way that almost anybody can understand. And the way he does this, he has a tool for this, actually. He likes to use his preferred me medium for teaching is the whiteboard.
And so in the book it says at many of the meetings that he attends in NVIDIA he will leap up
with marker in hand and diagram a problem or sketch an idea, even if someone else is speaking.
are whiteboarding themselves at the same time.
Okay, so idea number two.
NVIDIA is Jensen.
With twenty nine thousand lives. Right now, NVIDIA has twenty nine thousand employees. So one of the first sentences or the first sentence in the book is that in another life.
Jensen might have been a teacher. One of the last sentences
in the book is the most succinction of the NVIDIA way.
Is that it's Jensen's way.
Or that it is simply
Jensen.
Himself.
There's a lot of similarities between Steve Jobs and Jensen. And one of the ten or fifteen books I've read about Steve Jobs and Apple, there's a line that's stuck in my brain that I never forgot.
And it's talking about how he built Apple. He said he's made and remade Apple in his own image.
Apple.
Is Steve Jobs with ten thousand lives.
What Jensen and Steve Jobs both learned.
The importance of managing, learning how to manage your company as an extension of yourself. Says everyone at the company shared Jensen's singular focus on the mission.
Everyone shared his work ethic.
Everyone worked as fast as humanly possible in order to keep NVIDIA one step.
Ahead.

He is Nvidia.
And the company is Jensen. The way I think about this, there's another no left myself. You could say, you know, Jens uh NVIDIA is Jensen with twenty nine thousand lives, or you can say you need to build an F1 organization because he has a great line about this. He says ultimately my E staff, which is his direct reports, which we'll talk about later.
is something that I have to know how to work with.
The company's organization is like a race car.
It has to be a machine.
That the CEO knows how to drive.
Michael Moritz wrote this book called The Little Kingdom, and it is about the first few years of the history of Apple. He updated the book in I think 2009, 2010.
That that book's called The Return to the Little Kingdom and he and he wrote a forward. And there's a line in that book where he's describing in the introduction or in the forward, he's describing Steve Jobs, I think is very appropriate here.
He said
Founders.
At least the very best of them are unstoppable.
Irrepressible
Forces of nature.
That is certainly true for jobs.
That is certainly true.
for Jensen and I think what he said there is very smart.
The company's organization is like a race car. It has to be a machine.
That the CO knows how to drive, and that's why he is built.
a company in his image. He has made and remade NVIDIA in his image. So let's go to the third idea.
The whiteboard. I already gave you a hint.
At NVIDIA, the whiteboard is a primary form of communication and meetings. It's very fascinating.
How?
You know, again, there's no right one right way to do it. It should be right for you.
Yeah, some people like basis wants.
A six page
You know.
Uh memo.
Jobs once
A demo.
Jensen wants the whiteboard.
So the whiteboard represents both possibility and
And ephemerality, I can't pronounce that word, I'm sorry. The belief that a successful idea, no matter how brilliant, must eventually be erased, and a new one must take its place.
One of the reasons Jensen likes to use the whiteboard as the primary
form of communication and meetings.
says everybody must demonstrate their thought process in real time in front of an audience. With the whiteboard, there is no
Hiding.
I lost count how many times in the book.
They're talking about how central like how important whiteboarding is.
to running the video.
And actually uh one of the things that Tay Kim was gracious to send me.
He uh sent me this this Wall Street Journal.
Like write up a review of the book written by this guy named Ben Cohen.
Ben has some great writing here, uh in terms of like what he learned from reading the book and then the importance of
of the whiteboard. It says instead of cloistering himself in a private office
Jensen prefers to work from conference rooms. He does his best thinking at the whiteboard.
Which he uses so frequently that he has a favorite brand of marker.
That is only sold in Taiwan.
And so even when he's traveling, they have to travel with this this specific brand of marker.
And they have the trouble of whiteboards. He's gonna use this everywhere else. This again, d I think ta explains why this is so important to Jen to Jensen.
Whiteboarding forces people to be both rigorous and transparent. It requires them to start from scratch every time they step up to the board.
and therefore lay out their thinking as thoroughly and clearly as possible. It becomes immediately apparent.
When someone hasn't thought something.
Through.
At the whiteboard there is no place to hide.
Idea number four, flat organizational structure. So Jensen's famous or infamous, the fact that he has sixty direct reports.
And he refuses to do
One on one. So
Jensen.
Th I I think the the one of the main reasons he designed a flat organization is a flat structure fights against the danger of slow decision making. Jeff Bezos has this great uh thinking about how dangerous
making decisions slowly inside an organization could be.
This is what Jeff said about this. You can drive great people away by making the speed of decision making really slow.
Why would great people stay in an organization where they can't get things done?
They look around after a while and they say, Hey, look
I love the mission, but I can't get my job done because our speed
of decision making is too slow.
This is something that Jensen learned.
in f through you know through trial and error and through failure. He says when we were a small company, we were really bureaucratic and really political. And so as a result of that, Jensen thought about how he create this ideal organization from scratch. And he realized he would choose a much flatter structure so that employees could act with more independent. He also saw that a flat structure would weed out lower performers who were unaccustomed
to thinking for themselves and acting without being told what to do. And you just said flat out, I want to create a company.
that naturally attracts amazing
people. And so Jensen describes this flat organizational structure. The first layer is the senior people. This is this E staff.
You would think that they need the least amount of management, he said. They know what they're doing, they're experts in their field. He did not want to spend
time on career coaching.
Because the majority of them had already reached the pinnacle of their careers. He rarely held one on one meetings with his direct reports. Instead, he focused on providing them collectively with information.
from across the organization as well as his own strategic guidance. And what I love about this.
is that he's adamant about running the company.
based on the best way to do it for him and he refuses.
to change his management philosophy he is insistent
on a flat structure says he steadfastly refused to change his management philosophy even when new board members joined and recommended that he hire chief operating officer to reduce his his administrative burden.
No thanks, he replied.
This is a great way to talk about the way he runs the company and this flat organizational structure.
It's a great way to make sure everybody knows what's going on.
Really think about what he's doing here, what he's saying.
You create a company building philosophy that fits you. It does not matter.
What other people are doing.
What is natural and authentic to you?
And what do you are and are you going to enjoy doing that? So you can do it for a long period of time. Jensen created a company that he can manage directly. There is a vast
cultural difference between NIDIA and other companies.
Jensen talks again about this. I mean these the the these ideas are you know
I organized them all like under a topic, but they are
You sped through hundreds of pages in the book.
So Jensen repeats again, the benefits of keeping his company flat. It turns out by having a lot of direct reports, not having one-on-ones, we made the company flat.
Information travels quickly, employees are empowered.
That algorithm was well
Conceived.
And finally, another benefit, he says you want a company that's as large as necessary to do the job, but as small as possible and not bogged down by over management and process.
Number five.
And again, this is why I think all of these really you know, it doesn't really matter what order you take them in.
Other than I think number one probably has to be the Jensen's teacher,'cause he's really teaching his philosophy to the entire organization.
But very public criticism. This is something he's known for. This is probably repeated more than any other idea in the book.
And the reason I put this after number four, which is, you know, build a flat, fast organization. Because turns out very public criticism works very well.
If you want a flat, fast organization. So
Jensen does not believe
Yeah, there's just Maxim like
Praise publicly, criticized privately.
No.
He does not he criticizes publicly.
So that the entire organization can learn from a single person's mistake.
There's so many examples throughout the book. There's a lot of parallels to again Steve Jobs here.
Over the years I realized
that what was happening. How people protect their turf and how they protect their ideas. So he's anti, you know, he does not want
bureaucracy to build up into a size company. So I created a much flatter organization.
His anecdote to backstabbing, to gaming of metrics, and to political infighting is public accountability and if need be
Public embarrassment.
I just say it out loud. I've got no
Trouble.
calling people out. So let me give you an example.
Of Jensen's public criticism.
So that the entire co
company can learn from an individual's mistake and his constant fight
against complacency, which would be another idea that you and I will talk about.
Jeds was furious at the poor planning and execution on the chip.
He called out its engineers at an all company meeting.
Is this the piece of shit you intended to build? he shouted.
The architects did a shitty job putting the product together. How could you not see the issue before it happened?
Someone should have raised their hand and said we have a design issue here.
Th this is a product they called the N V thirty.
And so yelling at the people or cursing at them, you know, some people were like, I can't like can can we kind of moderate our language? Can we be a little, you know
More kind or more respectful.
I was reading this uh actually no it it it came from uh
It's not even from Johnny Ives.
biography. It actually comes from an interview Johnny I gave Johnny I gave
After
Um Steve Joub's past and he talked about
one of the best criticisms that he ever got from
From Steve was the fact that
Steve called
Johnny Vane.
And
This is what Johnny said. He goes, I remember t asking Steve about this.
Uh, it could be perceived that his cr critique of a piece of work was a little harsh, right? Didn't that just sound like what we just

Wait, Jensen?
Seems pretty harsh. It's like calling you a piece of calling what you did a piece of shit.
I can't believe he did this. He's screaming.
And so Johnny's recounting this conversation with Steve. He's like, you know, you were kinda harsh with your criticism.
We had put a lot of heart and soul into this.
And I asked Steve, could we not moderate the things that we said a little?
And he said why?
And I said because I care about the team and Steve said this brutally brilliant, insightful thing.
He said no, Johnny.
You're just really vain.
You just want people to like you.
I'm surprised at you.
I thought you held the work up as the most important.
Not how you believe you were perceived.
By others.
Johnny's response was
I was terribly cross because I knew he was right.
Jensen is not doing this to intentionally hurt people's feelings.
He's doing this because he puts the work up as the most important
He has this great line where he says he tortures people
I guess I'm laughing.
He tortures people into greatness.
So Jensen offers NVIDIA employees direct criticism in large meetings so more people can learn from a single mistake. This is what he says. Feedback is learning.
For what reason are you the only person who should learn from this?
We should all learn from that opportunity.
says a Jensen displays his trademark directness and impatience in all settings.
He does this all the time.
In small meetings too.
He just can't let go. He has to make it.
punitive a little bit.
Again, public criticism is very important to Jensen.
I don't know, a dozen times.
Over and over again. In fact I I I saw it so much.
I went up leaving myself the same note over and over again. I go, Oh, this is just like Steve Jobs telling Johnny that he's vain.
that you're putting people's emotions over the work. Again.
Jensen is going to hold up the highest.
He's going to hold the work as the quality of the work
As the most important. So
I I don't wanna seem like a like a like a crazy obsessed person, even though I definitely am. Um
I play

I play uh the l the documentary The Last Dance in the background while I work and the last dance is obviously about Michael Jordan.
And the final season with the Bulls.
And there's actually a that was a
is going over the outline and reading the book.
Well, this is playing in the background and there's actually a line in the documentary where one of Jordan's teammates is describing Jordan.
And
Because I was like
Eyeballs deep.
in the world of gents in the past few weeks.
At the same time I'm rewatching the documentary, I was like, Oh, this this sounds just like Jensen.
So this is this is Jordan's teammate describing
Michael.
Michael wanted to be the best player on the best team.
He's raising his voice. He's calling guys out. He's talking about how he's treating his teammates, right? He's raising his voice. He's calling guys out. So we're not playing well as a team.
We're lazy.
He's not worried about hurting your feelings.
If he did, you could leave. He would gladly tell you you don't want to play hard.
Fine, get out.
And then right after this, Michael's explaining
This leadership style.
And why he played the game the way he did.
And I feel like there's a echo of of
Of Jensen. Jensen is not trying to be like
Oh, just you know, just another founder. He's trying to be the best of the best.
To create a company that nobody else on the planet
Could
Create and he has done that.
And so he's talking about the fact that
He's being really harsh on his teammates. He's he's calling out how lazy they are and not um
Not working hard enough, not not practicing enough, not playing well in games.
And it this is a time when the second best player, Scottie Pippen, was out and he was really worried'cause they're losing games. He goes every this is Michael Jordan speaking now.
He goes every day that Scotty wasn't playing.
gave someone else the confidence that they could beat us.
And if you're trying to maintain dominance over people
You don't want to give them a chance to gain confidence.
So that drove my energy.
Let's get this thing rolling.
That leads into idea number six, tortured into greatness, this habit of self
So
Jensen is not just public si publicly criticizing other people.
He does this to himself.
He has a great line about this where he talks about I want to torture people into greatness. And what you realize is he's tortured himself into greatness as well. So
I'll talk about this a little bit later on, but Jensen believes that complacency kills.
And Jensen has this
Combination.
Uh
These traits may even seem contradictory, but I would just say that this combination of traits I'm about to describe to you is very common.
A lot of history screen such printers.
And as a result of the podcast, I get to meet a lot of world class entrepreneurs today to listen to the podcast, and they have these traits too.
Uh
So Jensen has this combination of extreme self confidence.
And charisma.
matched with this inner voice that says
He sucks.
An inner voice that says
Nothing he ever does is good enough.
And that inner voice typically.
is impossible to to satisfy.
Uh so he tortures his team into greatness.
But he tortures himself into greatness as well. And so let me talk about this intense
Habit of self criticism.
This is much later in the video's history.
They just they smashed this quarter.
the financial performance, the products are great.
There's like we just blew the doors off this quarter.
We're having a meeting with Jensen and figure is we're gonna like
Congratulate ourselves.
And he w stands up in front of Jensen front stands up in front of the room.
And he goes.
I wake up every morning.
I look at myself in the mirror and I say
You suck.
And so the person working in the video just could not understand. It's like
This guy's
Why all counts.
One of most successful people in the world.
How could he still think?
In such terms.
And my answer to that, by spending eight years and four months and reading three hundred thirty five hours for his good he does.
Of course he does.
Uh, Jensen has a great line in the book. He says, I don't like giving up on people. I'd rather torture them into greatness.
Idea number seven.
This is very fascinating. I don't I don't think I've ever heard this idea before. It's Jensen's speed of light idea. So
The speed of light idea is the only benchmark that we're gonna judge ourselves.
And how fast we move will be the absolute maximum speed possible. What?
The hell does that mean?
So

He wants
All of the work done in NVIDIA to be contained by
Only one thing, and that's the law of physics. So the speed of light means that you have to take every single project inside your company.
You break it down into into its component tasks.
And then each task must have must have a target time to completion that assumes no delays.
No cues.
Or no.
Downtime.
Why?
Of course you're gonna have some kind of unexpected things pop up.
Because he wants to set the theoretical maximum, which he calls the speed of light.
What is the physic like the the fastest this could be done.
And you know it's the fastest it can be done because it's physically impossible to s to exceed that time.
And then he says.
We're not gonna judge.
ourselves on what we used to do.
We're not gonna judge ourselves on what other companies
Do I don't give a shit.
What other companies are doing. We are going to judge ourselves
Against
The speed of life. So it's our spe speed of life.
Speed of light. Says Jensen would reprimand subordinates whose set goals are referred to what the company had already done before.
or what the comp competitors are doing at that moment.
As he saw it, he needed to prevent that kind of eternal rot.
That he observed.
At other
Companies.
So I'm gonna give you an example of Jensen's speed of light idea. I already gave you a little hint earlier.
This is about the Riva 128. To save time, Jensen decreed that NVIDIA would have to develop their driver's software.
For the Riva one two eight.
Before the prototype chip was completed.
This was a reversal.

This would save shave nearly a year off the production timeline. You have to shave a year off a production timeline, because if you remember, he's running, he's got nine months of cash. Now he just bought that.
Machines. He's got six months of cash. There is no time.
So it says uh this was shaving nearly a year off the production timeline, but it would require the company to find a way to bypass the step of testing the software on physical chips.
That's why Navidia invested a million dollars in that Icos.
Emul emulator.
even though every dollar was precious, it would allow them to approach
The speed.
of time. Here's another description of the speed of time. NVIDIA employees did not think
Did not let themselves think about what was likely to work or what they could reasonably achieve.
They only cared about what would be possible.
With the maximum amount of effort.
and minimum amount of wasted.
Time.
Idea number eight, Jensen is
Unapologetically extreme. He's extreme in all things.
He works all the hours and he says no one will outwork me. So these ideas I I I grouped all under
Idea number eight.
So you know I'm obsessed with
Edwin Lan, founder of Polaroid.
Steve Jobs hero.
And there's a great line in one of the many biographies of Edwin Lan. I think I've done like five or six podcasts on Edwin Lan. So if you haven't listened to them, you should go in the back catalog and definitely listen to as many as possible. Steve was studying Edwin Lan when he was twenty.
Steve was still studying'em when he was dying.
Uh she's an incredible, incredible person. But Edmund Land is, you know, one of one.
And there's a great line in one of his biographies.
Somebody worked with
Wedmond Lann, he goes.
This man never had an ordinary reaction to anything.
Jets is the same way. So there's this hilarious meme, and any and any guy knows this. Like you walk into a public restaurant, there's or public restroom, there's a series of urinals.
It is plate. It is
Etiquette
If there's a bunch of empty urinals, do not stand next to me. Like give me some space. And so there's this meme you always see.
Where this guy's using urinal.
There's like fifty empty urinals and then the guy walks into the bathroom and uses the one right next to him.
Jensen literally does that. He he did that. This guy is so relentless. He will if you work for him, he will grill you.
Uh
The urino.
I gotta read this to you.
No place in a video headquarters was safe from a drive by grilling from Jensen. Let me pause there, actually. I just thought about this. I didn't think about this earlier.
There's a line.
Again, another paralleless jobs.
Uh it talks about how intense his focus and like he'll he'll stare at you and he like he should completely focus on you. It's kinda like would scare some of the employees at Apple.
And if they found him in like an elevator or something, they would like try to skip the elevator.
Because
You don't want his attention. I think there was an example where like you get in the elevator, every time you get off, you've lost your job.
Because he was like focus on what you're doing and you couldn't explain where you're working on I was very upset.
So there's a there's an element to that with Jensen as well. So
Yeah.
There's a guy named Kenneth Hurley, he's out of urinal.
Jensen walks up.
And he starts using the one next to him.
And Hurley goes, I'm not the kind of guy who likes to talk in the bathroom.
And Jensen had other ideas. He goes, Hey, what's up?
And Hurley replied with not much.
Which earned him a sidelong glance from Jensen. Hurley panicked thinking I'm gonna get fired.
'Cause he thinks I'm not doing anything. Hurley proceeded to list twenty things he was working on.
Okay, Jensen replied, satisfied.
With the answer.
When I first read that, I absolutely lost it. I just started laughing.
uh go back to this idea is like no one's gonna outwork me. He's unapologetically shame. He says there may be s people smarter than me.
But no one is ever going to work harder than me.
When part of his E staff mentioned to Jensen that some employees were griping about the long work hours,
Jensen's response was typically direct. People who train for the Olympics grumble about training early in the morning too.
Jensen was sending a message.
Long hours were a necessary prerequisite for
For excellence.
over and over again these these these examples of Jensen just being completely unapologetically extreme.
There's like some kind of like
uh like award given by a magazine or some kind of like uh industry, you know, publication.
And they thought they were happy like, Oh look, we finished second. This is the early days of the new video.
And Jensen sternly tells them second place is the first loser.
Jensen's guidance was direct. Just go win. The idea was whoever could run faster is going to grab all the land.
Jensen's unapologetically extreme when he was recruiting.
He invites this guy that working at, he's a chief engineer at Silicon Graphics. He invites him to lunch. He goes, Listen, John, you should really think about coming to NVIDIA because ultimately I'm going to put SGI out of business.
Jensen is completely
Relentless about work.
He says you have to allow yourself to be obsessed with your work. I work every day. There's not a day that goes by that I don't work. If I'm not working, I'm thinking about working.
Working is relaxing for me.
And so here's an example of how just being unapologetically extreme actually created a lot of value.
for the video.
And some might call this story like how do you work three times as hard and three times as fast as your competitors?
But there's just a lot of anecdotes in the book where
There's people that
Used to work in a video.
They got used to the culture and then they leave and they go work at other like tech companies and like, Wait, w why is everybody like everybody else is moving like slow motion. There's like way le the the their culture's a lot less intense. So
It's not just to be onapologetic extreme for the sake of b being onapologetic extreme or throwing a lot of uh a lot of like hours at something. It's like doing this to have an advantage other people don't.
And so
Jensen. Uh the the this is this is before the AI boom.
The video's just a PC graphics.
Uh still just in the PC graphics industry.
And he's trying to figure out. He's like okay, like
The the top of this industry, there's like a lot of turnover.
I've gotten to the top. I want to stay here. How do I do that?
And one way he does this is by being unapologetically extreme. So he says, if you look at the PC graphic industry, why is it that one company can never hold a lead for more than two years?
Now that Navidia was the market leader, Jensen became obsessed.
With this problem.
You realize the whole industry moved according to the rhythms of the computer manufacturers who refresh their product launches twice a year.
Chipmakers.
Nvidia included.
Took eighteen months to design and launch a new chip.
and typically only worked on one ship at a time.
Which means chips were functionally obsolete long before chipmakers
could come out with a new product.
Jensen had figure out figured out how to keep NVIDIA ahead of its competit competition. He said
We were going to fundamentally restructure the engineering department.
to line up with the refresh cycles.
Which how how do you do this?
NVIDIA would split the design team into three groups. The first would design a new chip architecture.
While the other two work in parallel
To the first
To develop faster derivatives
Based on the new chip. What is that? Why? Why would you do that?
Because this allows the company to release a new chip.
Every six months.
Their competitors are releasing a chip.
Every eighteen months.
And he has a line for this. He says
This was called Three Teams Two Seasons.
Now the company would have three times as many chips on the market.
Even if a competitor offered a slightly better product.
P C makers.
would have no motivation to switch away from NVIDIA.
Knowing that a faster part
Would arrive.
Within six months.
Idea number nine, this is one of my favorite ideas. I've never heard this either.
It's Jensen's top five email idea. Really, this is just a genius way to get unfiltered information from the entire company. So
Jensen asks every employee in NVIDIA at all levels that you have to send an email
And they're called like T five T. So you need the top five things that you're working on.
Or what you'd recently observed in the market.
Uh things like customer pain points, what some competitors doing.
Any kind of new development in technology.
uh if there's any kind of project delays. And so the ideal top five email is five bullet points where the first word is an action word.
And so something like finalize, build, secure.
And to make it easier for Jensen to filter these emails, he has each department tag them by the topic and the subject line. So let's say he wants to get all the recent emails on hyperscaler accounts, he can just easily do a keyword search, see all that, and then read through all these bullet points. Now
Top five emails is a crucial. They are crucial.
feedback channel for Jensen.
And he would tell his employees why he uh why he the like top five emails are so important. He says it's easy to pick up on the strong signals.
But I want to intercept them when they are weak, which he winds up doing. Which I'll tell you back in one second.
But again, I think all these ideas are combined.
Unapologetically extreme, top five emails.
So he's like, you know, I wanna pick up on
these weak s these signals when they're weak, and then we can develop into something that's strong.
But to his E staff he said it this way.
Don't take this the wrong way, but you might not have the brain power or the wherewithal to detect something that I think is pretty significant.
So every day he reads, you know, over a hundred top five emails to get a snapshot.
at what's happening inside of the company.
And so I want to read from that Wall Street Journal article that was written by Ben Collins that Tay Kim sent me. He says employees have been sending notes known as T five Ts, Top Five Things.
uh that they're working on things they're thinking about or things they're noticing in the corners of the business. And for decades, Jensen has been reading them. All of them. If you send it, Jensen says, I'll read it.
Top five thing emails have become his preferred method of of flattening hierarchy.
Strategy isn't what I say, it's what they do.
Jensen said, That's a good line.
Strategy isn't what I say, it's what they do.
So it's really important that I understand what everybody is doing.
He does that by reading top five thing emails.
He doesn't want information that has already made its way through layers of management. What he wants is information from the edge. That's a direct quote from Jensen. He says, I want information from the edge. He is looking for the next zero billion dollar market, a frontier.
That has not been explored because it barely exists, but one day could be a thing.
One of the weak signals that he intercepted years ago was a wonky
But exciting development and machine learning that kept popping up in T five T emails.
Jensen decided that NVIDIA needed to invest more in tools
For accelerating workloads
On its GP use.
This is why they're a three trillion dollar company today.
That decision clearly paid off.
These days those GPUs are the brains of artificial intelligence.
And again, the the the the hilarious part about him being unapologetically extreme, he says
This is what he does for fun.
He's like I drink a scotch and I do emails.
And the one one funny thing, there's an anecdote in the book that's pretty funny.
Where people hate when Jensen goes on vacation because he emails them more.

Email culture.
Uh
Uh, they say the email culture in NVIDIA is like unrelenting. There's nothing he he doesn't let anything stare, anything fester. If you get an email from him, you need to act on it right away. He does not want anything to fester.
And in fact, uh I finished reading this book quite a while ago and I were working on outline and organizing the ideas for for way longer than I normally do, because I I really do think it's
You know, he's probably he is one of the most important founders alive right now. And I think there's just a lot of good ideas that you and I can hopeful use in our work too.
So I've been like having nonstop conversations with a bunch of my founder friends about this.
And I was actually telling a friend about this intense email culture described in the book.
And I didn't know that
NVIDIA invested in my friend's company, this company called Together AI.
And the company's again, this is just an investment from NVIDIA and he's like, Oh yeah, like he's like that in real life. Like, What do you mean? He goes
Like he invests in our company.
And we'll send emails.
And the response is super fast.
And
At the same lunch when we're having lunch, I met a young
K young guy, I shouldn't say kid.
Uh, but a few years ago, he was a kid. He was probably like nineteen at the time. And he was working for like some chip company. I for I can't remember the name.
But
he heard that what we were talking about and he's like, Oh yeah, d I I emailed Jensen, What do you mean you emailed Jensen? He's like, Well I was a uh intern at the ship company and inside that company they kept talking about they're developing like the NVIDIA killer or whatever
And so this intern and another chip company cold emails Jensen.
And within
You know, a few minutes.
Jensen writes back with like his perspective.
on is there like is it true what their company's saying? Is it possible? Is the NVIDIA killer? But again, he just wants to know what's going on. He wants
Information from the edge. Idea number ten. This won't come as a surprise. Jensen's communication style, blunt.
Concise and direct.
Uh he says over and over again that he do he believes in direct
Truthful.
Blunt communication. We're not worried about people's feelings. We're putting the work above everything else.
But I just have to read one line that I absolutely loved.
Jensen's emails are short and sweet.
Like a haiku.
This is something that even outside of
work that he he has in common with a lot of history's greatest leaders. Napoleon was the same way. Let me read this
This line from this biography of Napoleon.
Uh that I read.
says long orders which require much time to prepare.
To read and to understand are the enemies of speed.
Napoleon could issue orders of a few sentences which clearly expressed his intentions and required little time to issue and to understand Winston Churchill.
uh during World War Two when he's fighting the Nazis. He would limit the size of the memos that you could write him.
And he would tell his staff it is slothful.
Not to compress your thoughts.
One of my favorite examples of this. What did it just say?
Napoleon could issue an order in a few sentences, which is clearly expressed his intentions and only required little time to issue and to understand.
If you have not read the book Creative Selection, highly
recommend that you do. It's written by a programmer that would demo and work with Steve Jobs.
You could also listen to the episode.
Which is episode two eighty one called Working with Steve Giles, which is on that book.
Here's a line from the book.
It's gonna sound just like Jensen?
It's just gonna sound just like Napoleon, just like Churchill.
Steve was always easy to understand.
He would either approve a demo or he'd request to see something different next time.
Whenever Steve reviewed a demo, he would often say
With highly detailed specificity.
What he wanted to happen next.
He was always trying to ensure the products were as intuitive and straightforward as possible.
And he's willing to invest his own time, effort, and influence to see that they were.
I chuckle to myself.
Over how much time
I've spent thinking about this iPad demo.
And how much Steve taught me.
In one meeting.
Where he spoke just four sentences.
Idea number eleven, Lua. Again, all these ideas interact with each other.
I think they build upon one each other. We just talked about how important being direct.
important of doing you know f having a flat orientation structure.
and going really fast. So if you start rambling
Jensen will just say Lua.
Okay, this is a maximum
And it's shorthand. It's an acronym.
It means listen to the question.
Understand the question.
Answer the question.
So if he says Lua, he wants you to stop.
And just do those three things in order.
Listen to the question.
Understand the question.
Answer the question. Number twelve. This is so cool.
I again I love there's a bunch of ideas in this book that are truly novel and unique.
To number twelve.
The mission is the boss and pilot in command.
I think he really picked up on the fact that
As you build an organization.
Over time as it grows.
It starts to exist.
For the sake of perpetuating itself.
And he's like No no no
We want a flatterization.
One.
Like
We wanna just focus on the mission.
But as the mission changes, and if you read the book and y obviously clear, like they they start on the video game industry, what are they doing now? They're dominating
The artificial intelligence.
industry.
Like that is because he had this flat
fast, reactive culture and organization.
And he can switch the mission and then take all the resources onto that new mission.
This is what Jensen says. The concept of the mission of the boss makes a lot of sense because ultimately we're here to realize a particular mission, not in service of some organization.
Under the mission is the boss philosophy.
Jensen starts every new project by designing a leader, and I love what they call their leader.
They call the leader a pilot.
This pilot in command.
Now
is the one accountable for that that that mission
And is directly
uh reports directly to
Jensen.
He says we have a PIC, a pilot in command for every project.
Nobody can hide behind such and such team is working on that. No, it's a person.
Who's a
Goddamn name attached to it.
The pilot in command is accountable.
Uh J Jensen organized Nividi's employees into groups centralized by function, sales, engineering, operations, and so on.
They're treated as a general pool of talent and not divided by business units or
Divisions. Why? Because when you have a new mission, you take all these
these uh functions, sales, you know, engineering, operations, whatever, and now you can
Turn them or point them.
at a new mission and now they're under the direction of a pilot of command.
And then that pilot in command it directly reports to Jensen.
Um, again, I think this is really really important. I dedicate an entire episode.
To this.
There's episode three sixty, if you haven't listened to it, it's on Bob Kierland, the founder of Fasinal.
He wrote a book that
That book has one
Really one idea.
That you that the leader's job is to keep everyone inside of the organization working for the company's core objective. That is very natural.
In human nature.
To drift and the lady's like No
Back over here.
back on the company's core objective.
Uh one other section from this he gives Jensen gives his employees a high degree of independence over their individual projects, but only if they can keep those projects
Perfectly aligned.
With the company's core.
Objectives after you're done listening to this.
If you want I think you should spend an hour.
Really t
digging into episode three sixty, the book is almost impossible to find.
Uh I had a friend of mine actually write to the company.
And that's how we were able to get like twenty or thirty copies of the book.
I don't even know if you can buy it anymore, but episode three sixty again.
You can summarise that by
It's a leader's job to keep everyone working.
Toward the companies.
Core objective number thirteen.
It's one of my favorite lines.
In the book.
John Johnson. Jensen says, strategy is not words.
Strategy is
Action.
Strategy is not words, strategy is action, gentlemen said. We don't do periodic planning.
The reason for that is because the world is a living, breathing
thing. We just plan continuously. There is
No
five year plan.
Okay, so
Again.
I'm gonna read that paragraph.
And I'm gonna filter that paragraph through every other thing.
that I've read for this podcast and every other thing that you and I have talked about.
That line strategy is not words, strategy is action. It's one of my favorite lines of the book. And immediately I think of Henry Singleton. So
Henry Singleton had a very
Distinct philosophy around planning.
Um I I did a uh I think one or two episodes on them.
Years ago. I gotta redo this. He he's too important.
And I didn't know how to podcast back then.
So I gotta do another episode on it.
Charlie Munger, for example, said Henry Singleton was the smartest person he ever met.
Okay.
Buffett.
Says that it is a crime.
that business schools don't study singleton. And I think you said you could take the top one hundred business school
uh graduates and combine their record and and still wouldn't compare.
To Singleton's record.
There's a lot of uh ideas'cause I discovered Buffett and Mauger before I discovered Singleton.
That I thought were buffing and mongers.
And they were actually they learned from singleton'cause he was building a very successful conglomerate.
Uh called Teledy.
So I go and I ask Sage.
for these ideas like how did
H what did Henry Singleton say?
About planning.
And Sage did an excellent job summarizing
Singleton's philosophy, which to me sounds a lot like
Jensen's philosophy.
So number one, fli flexibility over rigid plants.
Singleton said, I know a lot of people who have very definitive plans, they follow assiduously, but we're subject to a great number of outside influences on our business, and most of them can't be predicted. So my plan is to stay flexible. Sounds a lot like
What?
Jensen just said. Number two.
Daily steering steering versus long term planing.
Uh Singleton's approach was summed up in h the quote where he says, My only plan is to keep coming to work every day. I like to steer the boat each day.
Rather than play plan way ahead into the future.
Number three, rather than getting caught up in detailed strategic plans, Singleton focused on retaining flexibility and keeping options open. He believed excessive planning constrains freedom of action.
Number four, recognition of complexity, which is exactly what
Jensen said the fact that the world is a living, breathing, changing thing. Singleton understood that businesses are subject to numerous outside influences that cannot be predicted, making detailed long term planning potentially counterproductive.
And then this is I think would Jensen would agree with. Number five.
independent thinking. When others were doing something, Singleton was often skeptical.
For example, late in his career when many companies are doing share repurchases, Singleton said if everyone's doing them.
There must be something wrong with them.
And so when Jensen also said, Hey
He's another line that popped up to me. He's like we don't have a five year plan.
That is exactly the same kind of thinking.
That Michael Bloomberg used.
to build his company. In fact in Bloomberg's autobiography, this is what he wrote.
I never let planning get in the way of doing.
Don't devise a five year plan.
Central planning didn't work for Stalin or Mao.
And it won't work for an entrepreneur either.
Okay, idea number fourteen.
Choke.
Gold.
This is a very, very old idea.
Um, Brad Jacobs in his book How to Make a Few Billion Dollars.
talks about the fact that, you know, between all his companies there's like a hundred forty thousand employees or something and he goes listen
Money animates people everywhere.
You really should overpay for top talent because it's nearly impossible.
to overpay for top talent. And the reason I distilled this down to the maximum
Choke you with gold.
It's because I was reading this old book of David Ogie, and David Ogie talks about this. He said the Medici family
Persuaded this very famous
sculptor in Florence.
To enter their service.
Where they wrote him a letter.
Which concluded.
Come.
I will choke you with gold.
If you are talented in contributing to NVIDIA's mission, Jensen will choke you.
With gold.
Jensen pours over the stock allocation reports.
Managers can refer an employee for special consideration to senior executives.
Jensen will review this list of top contributor, which they call T C list.
Okay.
Jensen will review the list of top contributor candidates.
And give out special one off grants of stock.
that vest over a four year period.
Once such a grant is approved, the employee receives an email from a senior executive with Jensen copied on the email.
The subject line will say special grant.
Which authorizes the RSU grant in recognition of your extraordinary contributions with a clear description of the rationale behind the award.
This is really important, I think, too, about when you do this thing.
When you when you decide to
To grant these.
Jensen also reaches down into the organization any time and awards stock directly without waiting for an annual compensation review. This allows him to ensure
That people who are doing great work feel appreciated in the moment.
It is another sign.
of his interest in every single aspect and every level of his company.
Which leads us to idea number fifteen, which is a quote from Walt Disney.
Walt Disney said if we lose the detail
We lose it all. Jensen is in the details. I'm sure people would accuse him of being a micromanager.
Just like they would accuse Walt Disney of being a micro manager or Steve Jobs and so on and so forth.
uh for his entire
Jensen has keep in mind, Jensen has run NVIDIA for over three decades.
And the way he's done that is he manages the company directly. He involves himself deep deeply in product decisions, sales negotiations, investor relations, and more.
He does not work in a private office.
He involves himself in everything at NVIDIA and so all of these company building philosophies.
that he has learned and impl implemented really allow him
To get out of the
get the most out of the organization that he built and he built that organization
In the bet that

the best for him to run.
Remember what Michael Moore said on Steve Jobs and the great founders? Founders, at least the very best of them are unstoppable.
Irrepressible forces of nature.
Walt Disney will fall into that category. Steve Jobs would fall into that category. Jensen falls into that category. Number sixteen. ID number sixteen.
Complacency kills.
No looking back.
No resting on our laurels.
Innovation is a necessity.
На оці.
And
Paranoia.
And so there's a line in the book that says Jensen runs the company the way he does because he believes that NVIDIA's worst enemy is not the competition, but itself.
The complacency that grips any successful
company. And this is he applies this
Two
complacency that is both real and imagined. Remember, he is ruthlessly self critical.
and blunt about his failures.
And his mistakes. And so
Yeah, people are
looking at video now, it's like one of the best companies ever created, but
He
It's very fascinating that he doesn't like looking back and when you do look back
It says he resists overly positive accounts.
of Navidias startup period and his own missteps.
When we were younger, we sucked.
At a lot of things.
NVIDIA wasn't a great company on day one.
We made it great over thirty one years. It did not come out great.
You don't build N V one because you're great.
You don't build N V two because you were great.
the the the failure of those nearly killed the company in its infancy.
And so he has a great line about this. He says we survive ourselves.
We were our own worst enemy. Jensen believes that for the first fifteen years when he was CO
He sucked. He says this.
He he actually says it in third person. He goes, If Jensen, meaning himself, wasn't even involved in the first fifteen years of the company, I would really like that.
He was not proud how he managed the company.
And he says I don't love talking about our past, but
I don't wanna like I think this is an important thing too. It's like
Yeah, he doesn't love talking about his past. He's not just talking about his past
Failures.
He he applies that even after a massive success. Remember that one story when they're smashing the quarter.
And he tells his team that he woke up that morning and wakes up most morning.
Mornings.
Looks at himself in the mirror and's like you suck.
And I actually think there's a very productive way to do this, so
This idea of not looking back, not resting on your laurels.
Again, this is something he has common with Steve Jobs.
And he has a great way, I think summarizes the
what Jensen's doing here, not resting on slorals, not like
He he's I think later on the book Jensen says something like, you know, wasting
There's nothing worse than like looking back at your own accomplishments or w um just not
Good use of your time.
And so what Steve says is I say he says
I think if you do something and it turns out pretty good.
Then you should go
Do something else that's wonderful and not dwell on it for too long.
Just figure out
What's next?
The the reason I think this is important and that that
It also fits into like Steve Jobs.
overall philosophy. If you go back
And asked if Steve was asked one time like what his favorite quote is.
And it was actually a quote by Aristotle where it says, We are what we repeatedly do.
Excellence then is not a act.
But a habit.
And so I think Steve would tell you the key is to keep pushing forward.
Stay hungry and continuing.
continue to create really wonderful things rather than than dwelling on
Past achievements.
And so throughout this book is this this theme just reoccurs over again that complacency kills.
I went back and searched all my notes and highlights and you just see this over and over again. Andy Grove, he had this mantra.
Success breeds complacency?
Complacency breeds failure.
Only the paranoid survive.
Herb Keller, the founder of Southwest, said a company is never more vulnerable to complacency than when it's at the height of its success. We must not let success breed complacency.
Cockiness, greediness, laziness, indifference,
Preoccupation with bureaucracy, hierarchy, or obliviousness to threats posed by the outside world. This is a great line from one of the biographies of Bernard Arnault.
Founder of LVMH that I read. He abhors complacency.
So much.
Les Schwab, who's one of Charlie Munger's favorite founders, he said
We must constantly remind ourselves as to why we are successful.
And what we must do to continue to be successful because if we become complacent, brother, it's all
Over with.
Warren Buffett.
You need to fight off the ABCs of business decay.
Arrogance.
bureaucracy and complacency.
When these corporate cancers metastasize even the strongest of companies
falter. And so that combines with the fact that at NVIDIA, innovation is a necessity. It's not an option. And so really you could think about
This is really how you avoid the innovators dilemma. So one of Jensen's favorite favorite books.
is the innovator's dilemma. One of the main takeaways he took from reading the book is that
Y the threat is actually gonna come from the low end of the market.
And I actually love what he did here.
So number one, the threat comes from the low end of the market. Number two, ship the whole cow.
And
This is gonna be fasting. So this is
Jensen talking about how to avoid the invaders dilemma.
The innovation is a necessity. It's not an option for them in NVIDIA. He says we build Ferraris. All of our chips were designed for the high end.
The best performance, the best triangle rate, the best polygons.
I don't wanna let someone come in and be the price leaders and lock me out of the bottom and climb their way to the top.
She said that that
theme reappears throughout the history. Obviously uh Clayton Christian
Talks a lot about that in the innovative dilemma. Jensen saw the NVIDIA could stop throwing away parts that failed quality tests.
This is fasting. Ship the whole cow.
Is his idea here, okay?
We're building Ferraris.
Our chips are the best of the best of the best.
Best performance, really high prices, fat margins, right?
So what w if I wanted to attack myself, what would I do?
And then I'll just go do that before somebody else does it to me, right? So Jensen saw that NVIDIA could stop throwing away parts that failed quality tests.
They failed.
Quality test if you're building a Ferrari.
But not if you're building, you know, a four
Fusion.
Right.
So
True, these parts were not suitable for the company's Ferrari grade ships.
But if they were otherwise functional lower speeds
NVIDIA could repackage them into a late less capable and therefore cheaper version
of the company's mainline products. This looked like a clear opportunity.
To make something out of nothing.
Rejected parts were generating no revenue for NVIDIA.
They were thrown out.
Think about how many
Different products.
buy products that Rockefeller made.
From materials that were waste.
Waste materials.
From
the refining of kerosene that he went turning turning into products and these massive
Profitable product lines.
That again, he was just throwing in the garbage.
Now he's like, Oh, we need to f find uses for our waste materials.
package them up as and sell our byproducts. Exact same thing.

NVIDIA could create a whole new derivative product line that could turn a profit without the expense of time and consuming process of research and development.
This line would serve as a defense against competitors for whom the low cost chip was their main product. NVIDIA could easily afford to price his chip.
Down so much.
that a competitors would be forced to sell at a loss.
This strategy was dubbed
Ship.
The whole cow.
A reference to how butchers find ways to use almost every part of the carcass.
Not just the prime.
Cuts.
Idea number seventeen, Jensen goes to school. And everybody already mentioned this earlier. This is somebody this is
This idea of going to school on everybody was described in one of the biographies I read of about a young Jeff Bezos. He said he went to school on everybody.
Obviously before he s founded Amazon and during and after
Um but
Jensen has the exact same, you know, tendency, same idea. So this is his conference on neural information processing systems.
Essentially an academic conference where
All the machine learning and neuroscience experts present their latest findings.
Okay. And so there's an actual
Navidia employee who's there.
And he runs into Jensen unexpectedly. He's like, Well Jensen, like what are you doing here?
You're not
You're not
You're you're not scheduled to speak to speak, what are you doing at the conference? And Jensen told him, I'm here to learn.
And what he noticed was that Jensen was sitting
Towards the front row.
And
It's not like he hired somebody to take notes on he's sitting there taking notes.
showing up himself and trying to absor absorb all the recent developments in artificial intelligence.
Because again, it goes back to Jensen wanting to be
involved in every aspect of
Novidia.
He's not trying to outsource things. He's trying to be in the details. Jensen also talks about the fact that, you know, at conferences like this, he meets a lot of smart people and winds up in recruiting and in in um
They become
Employees and assets.
of Navidia. So
This again, I think is a a recurring theme, the importance of going to school on everybody. There is this guy named Mitch Rails. Mitch Rails, co founder of this company called Dana Here.
Mitch Rails goes to school on everybody. Dana here.
It's like a hundred and seventy billion dollar company today.
And a friend of mine was just at the small intimate conference with Mitch recently, and he was blown away by how focused Mitch was.
And the entire time
Mitch was you know sitting towards the front.
listening to speakers and he was taking pages and pages of notes.
And my friend had this thought where he's like, I don't get this, Mitch. You're more successful than anybody else here.
Why are you taking notes? And when my friend told me this story, I go, No.
Wrong answer.
So there's a great line.
In Bill Walsh's book The Score Takes Care of Itself and he says
Champions behave like champions before they're champions.
I guarantee you.
Mitch Rails did not build a hundred and seventy billion dollar company.
And then start taking notes. He was going to school on everybody and taking notes and learning from every single experience way before.
He builds a hundred and seventy billion dollar
Company
Way before he is quote unquote.
the most successful person in the room because this goes back to the Max and the David Oll we said.
The good ones.
No more.
It's another example of Jensen being
One of the good ones.
Then no more.
Jensen shows up to this party.
And the video.
It's a party for new hires.
Introduce this guy named Peter Young.
Jensen already knew who he was. He says, You're Peter Young.
You've been here for a year from Sony PlayStation and then you worked at three D FX prior to that.
Jensen had similar
recall of all the biographical details.
of the other fifty attendees.
of that party.
Okay, idea number eighteen. Create markets.
Don't do anything someone else can do.
Don't do anything someone else can do is the motto of Edwin Lann.
But what Jensen was setting out to do, he he really believed that he was building a company that was unlike any other company.
And he knew he didn't want to build an undifferentiated commodity product. He wanted some kind of
Pricing power.
And so it says NVIDIA doesn't believe in building commodity products because commodities are subject to downward pricing pressure.
As competition increases. Jensen has always said that we should be doing things that other people cannot. That is exactly.
What Edmund Land said.
We need to bring unique value to the marketplace, and you do that by doing
Work that's cutting edge, that's revolutionary, work that no one else can do.
We do not this is the really the punchline. We don't have a culture of going after market share. We would rather create the market. Okay. So all of these ideas.
Leads us up.
Q.
The final idea. The idea number n nineteen is swarm your greatest opportunity.
And the reason this one is last is because it's gonna describe the massive historical opportunity that NVIDIA
has pursued an artificial intelligence.
And it's obvious when you read the book that all the things that you and I just talked about
Enabled and helped NVIDIA sees
what is going to be likely the greatest that one of the greatest opportunities that humanity has ever uh humanity has ever seen and a single company has been able to
Especially a corner of the market, maybe.
And and re most of the profits so far.
So
This is gonna go w the wild thing here, and this is gonna be probably the longest section.
Is the fact that
This this played out over, you know, multiple
Decades.
Jensen is going to recognize the AI trend very early.
He's going to invest
Heavily.
You know, when other people are telling him not to do this.
And he's gonna by doing so, he's gonna maneuver his company into position to take advantage of it.
Better than
Anybody else in the world.
So
gonna read a couple highlights. We're just gonna go through obviously this is what mainly the book is about, but I'm gonna give you
what I feel are like the the basic framework of important actions I think that that Jensen did.
And so there's an idea that reoccurs throughout these these books, and this idea that you have to stay in the game long enough to get lucky.
So the idea that's gonna turn NVIDIA into a multi trillion dollar company
Actually came from their customers.
Coming up with unique ways to use their product. So
The first reference to using NVIDIA GPUs for non graphical purposes
was in a two tausent two research paper
On using computers to simulate the movement of clouds.
you could think of these like really weak signals that that that Jensen was referencing earlier.
So it says an increasing number of computer science researchers are us using GPUs.
uh for non graphics applications. Researchers who ran their simulations on computers with GPUs reported significant speed improvements over computers that relied on CPU power only.
These simulations require computers to learn how to reframe
Non graphics computations.
In terms of
that graphical functions are in terms of graphical functions that a GPU could perform. In other words
The researchers.
Had hacked.
Nidia's GPUs.
Jensen's response here.
Was brilliant.
He sees this way, right, this unexpected opportunity as a way to expand.
The market for his products.
And he's interested in making it easier for other people to do that. So what does he do? Number one, he hires the guy
Who discovered how to do this.
Number two, he picks a mission.
He wants to make it easier.
For people like the guy who discovered this to find more non graphical applications of GPUs. Why? Because anytime you make something easier for people to do.
That will expand the market.
And so this guy's name is Harris.
Harris is the guy that coins the phrase
G P G P U, which means
general purpose computing on GPUs, which he's describing
This phenomenon that he is witnessing.
Now this is why
Jensen saying, you know, I want direct unfiltered information. I want information from the edge. Jensen quickly grasps that GPGPU.
had the potential to open up the markets for NVIDIA's GPUs.
Way beyond.
their existing market, which was just computer graphics.
And so Jensen's next thought is well, how do I make this easier?
The way I make this easier, I want to generate more demand.
I need to make it easier to program
These GPUs. So he they cre they create this new programming model for chips that they call the compute unified device architecture. It's called CUDA.
CUDA makes it possible and easier for scientists and engineers to leverage the GPUs.
Computing power.
Now keep in mind, we're like a decade and a half.
before all this cr this this huge AI explosion.
Because
And the reason that's important is because Jensen believed it
that this could expand NVIDIA's reach into every corner of the tech industry.
And this next section is why number nineteen, the idea number nineteen, is swarm your greatest opportunity. So this is happening in two thousand eight, two thousand two thousand seven, two thousand eight is where we are.
So the era of the GPU would create so many opportunities that Jensen saw it as his mission to prepare NVIDIA to take advantage of it, even if no one could know exactly
what those opportunities would be. Everything else
was secondary. So again, this is one of the most mind blowing
uh parts of the book for me because
It's two thousand seven, two thousand eight, Jensen's decision to go all in on this is literally gonna create trillions of value
For the company.
In the coming decades. It's a crazy amount of foresight on his part.
And it's also gonna require him to endure even more pain. So
Jensen's way.
to do things. It's like I'm gonna push this everywhere. I wanna make what I'm doing a foundational technology.
And
If Jensen has conviction for
For that this is gonna work, he's willing to invest
Heavily for the long term.
Even
when other people and the market are telling him not to do that. So let me just read this section. It'll make a lot more sense.
Jensen understood the importance of saturating the marketing with it the market with it.
The more people who had CUDA in their hands, the faster the technology would establish itself as a standard.
We should push this everywhere. We need to make it a foundational technology, Jensen told the co the Cuda team.
The move was extremely expensive. It took four years, and the company invested so much.
And converting its GPUs for CUDA compatibility.
That it's gross margin
F from forty five percent to thirty five percent.
As NVIDIA increased spending on CUDA, the global financial crisis destroyed consumer demand.
And NVIDIA's stock price.
fell by more than eighty percent from October two thousand seven to November two thousand eight.
Jensen believes so strongly in Cuda's market potential.
That he remained committed to the course he had chosen even as his investors demanded.
A strategic course correction. I believe in CUDA.
Jensen said.
We were convinced that accelerated computing would solve problems that normal computers couldn't.
We had to make that sacrifice. I had a deep
belief.
And its potential.
And then the video does something really smart here.
This is something that there's been a couple of examples of throughout history.
Of of the importance of doing so when you're doing something brand new.
You ha you you have to make a commitment to spend a lot of time and energy and resources into educating the market.
About this new invention. So
Intel
Did this when they invented the microprocessor, in fact.
They knew they were on to the biggest they s they swarmed their greatest opportunity.
It was very confusing to the market, very in some cases scary to the market. So they they
Wind up sending all the founders.
And the the the the the the
All the like the executives inside.
of Intel including their founders spent.
the majority of their time educating the market.
In fact, what Navidia does here it sounds a lot like
What Intel did.
when they invented the microprocessor. So developers don't know what to g do with CUDA. That's fine.
Nvidia is going to teach them. We are going to educate the market. So NVIDIA's chief scientist is a guy named David Kirk.
Begins offering
And sending st uh
colleges and universities cuda capable machines if they committed to teaching a class on the subject.
Uh, David Kirk went to visiting universities.
He would educ start educating students, professors, and department heads.
on all on all the changes on how they were teaching computer science
Because parallel computing was going to become far more important.
David Kirk.
Gave over a hundred talks.
over the course of a year on this.
He winds up teaching a class himself.
At the University of Illinois on the subject.
NVIDIA took it upon themselves to go over and spread the religion of GPU computing before it could it it really took off. In fact
This was a necessary step for it to take off. There was no textbook on this, so Kirk decides to write one.
There's always like this book, this foundational book. It's hilarious. If you're trying to get a movement going
I think one step is to to write a book on this. So Kirk writes the textbook on this.
That cl that textbook sells tens of thousands of copies, winds up getting translated into all these
uh different languages and it winds up being used by hundreds of schools to teach
Thousands, maybe tens of thousands of students.
Again, the idea is like we need to educate the market.
In addition to doing this at universities, they would host
So the the the the business development and marketing people at Nvidia would host summits. They'd have like these two day s technology summits at NVIDIA.
Where researchers and computer sciences scientists and engineers could come
and talk about like how they're using
CUDA and the GPUs. And so dozens of researchers from life science industry, chemical engineers, biologists, pharmacologists.
Software developers.
would would attend and then Jensen would show up and he would sit down and get feedback.
with the real world users of Cuda and then use the insights
That he learned from them.
to inform the development of the product.
And so again, th this is where now we're in two thousand twelve, two thousand thirteen.
And Jensen just realizes, Oh my God, this is gonna w wanna be the biggest opportunities in history. We are going to this opportunity of GPU.
powered deep learning.
is going to be massive and we need to go all in.
And so let me read this part on the book for you. There was considerable debate within the executive team on this topic. Several of Jensen's key lieutenants were against investing more in deep learning.
In the belief that it was just a passing fad.
But Jensen overruled them.
Deep learning is going to be really big, he said.
He said this in two thousand thirteen.
We are going all in on it.
So if you think about it, everything that you and I have been talking about and highlighting and studying has led up to this.
Jensen had built a company in the image of his own focused, yet far ranging mind.
Now he would pull every lever at his disposable at his disposal.
To navigate NVIDIA to the very center of the tech industry as the company whose hardware could bring about the AI powered future.
It was definitely not a single day when the entire company changed forever.
It was a period of several months where Jensen was increasingly interested and started askingly deep questions.
And then started encouraging the company to swarm.
to machine learning.
Jensen announced a change.
In strategic focus in a company all hands meeting.
We need to consider this work.
as our highest priority.
AI.
was going to be more important.
than anything else they could possibly be doing.
Again.
Incredible.
Incredible insight.
And foresight rather.
On Jensen's part.
He believed this was going to be the cause and he yeah.
Now ten years later, it's obviously true.
Obviously accurate.
It was gonna be the largest TAM expansion.
Within a decade
Jensen was sure that AI would create the largest total
Adjustable market expansion.
of software and hardware
That we've seen in decades.
And so the book does a great job.
Of describing the how the interplay of all these ideas, the decisions that Jensen and everybody in NVIDIA made over the course of three decades allowed them to build.
this very formidable moat. And I thought it was very fascinating. Uh, Jensen actually doesn't like the term moat.
He's he prefers what he's really trying to build and what he has built is a strong self reinforcing network.

the strong self-reinforcing network, this moat that NVIDIA's built, since it's hard to describe NVIDIA's action as anything other than the construction of a competitive moat.
NVIDIA made a general purpose GPU that represented the first major leap forward in computational acceleration since the invention of the CPU.
The GPU's programmable layer, CUDA.
was easy to use and opened up a wide range of functions across scientific
technical and industrial sectors.
As more people learned Cuda.
The demand for GPUs increase.
Jensen's strategic brilliance ensured
that competitors would have difficulty.
Breaking into a market.
Then NVIDIA.
had created.
And I think the best way to close is a reminder that the most succinct definition of the NVIDIA way is that it is Jensen's way.
Or it is simply
Jensen.
Himself.
And that is where I'll leave it for the full story. Highly, highly, highly recommend. It's a no brainer.
Reading the book.
Everyone I know that's read the book so far has loved it. I know a bunch of people that have bought multiple copies for their team.
If you buy the book using the link that's in the show notes.
Available on your podcast player or available at founderspodcast dot com. You'll be supporting the podcast at the same time.
That is three hundred.
And seventy six books down.
One thousand ago.
And I'll talk to you again soon.
Okay, so I have a big update for you for Founders Notes.
I am eight years into this podcast. By the end of the year, I will have read well over four hundred
Biographies and autobiographies of some officially founders.
I'm doing this because my
Organizing principle. My life's work is I want to organize and distill the collective knowledge of history's greatest founders.
And I wanna do that.
Better than anybody else.
on the planet. It's why I work on the podcast.
Seven days a week.
So as you can imagine, eight years into this, three hundred and seventy five difference, three hundred seventy six.

It's impossible for me to remember and recall everything that I've read. So
I built a tool that allows me
Two
recall and tap into this collective knowledge of history space founders.
on demand any time I want. And I use this tool every day.
And it's a tool that I've been telling you about for the past year. It's called Founders Notes. You can subscribe
and access the tool that I built and the one that I use. This is very important.
What you see when you subscribe.
That is the same version that I use. I don't have a different version. It's the exact same thing.
That you can use.
So the big update that I have for you is that I've been working with the team at ReadWise.
uh the founders of ReadWise and the team at ReadWise are the ones that have helped me actually build and design
This tool. So
For the past few months, we've been working on this major redesign of founders' notes, and that redesign is done.
And it's available now. I need to give you the prehistory, just like I spent a bunch of time in this in the video episode in this Jensen episode.
talking about the importance of the prehistory of what was going on before we got to the nineteen
Uh the nineteen key ideas I want to talk about.
So the prehistory of this project is that for the past six years I've been using this app called ReadWise.
to store all of my notes and highlights for every book that I've read the podcast that gives me ability to search it and pull it up any time I wanted.
Okay.
And the reason I partnered with Reedwise last year
Was because
A bunch of people listening to the podcast kept saying, Hey
Because I would talk about ReadWise, I'd talk about the app, I talk about how valuable it was and the fact that I just like it was very helpful and and useful to be able to to recall and and pull the everything up.
I didn't do it with
Ever thinking it was gonna build a tool around this.
But so many people were asking, it's like, Hey, is there a way I can actually like
read all of your notes. And so we built a tool called Founders Notes and it allows you to do that. You can still do that.
You can still read all my notes, all my highlights, and I keep adding to them every week.
And I will always do so.
But over time what I realized
Because I use the story day, it's like
The AI assistant called Sage that sits inside of Founders Notes is actually the most valuable
feature.
And there's a line in the book
uh that I didn't talk about in the podcast that's in the book where
Jensen's talking about like what can we can expect in this this A hi this AI enabled world that we all live in right now.
And he says, You'll be able to have a virtual assistant, almost like a brilliant intern.
with near perfect memory capable of inst instantly recalling any piece of knowledge stored on computers
And the internet.
Sage is this, but for the collective knowledge of history's greatest entrepreneurs.
So how I use it is like when I ask Sage a question.
He reads all of my notes.
All of my highlights.
all of my transcripts and then provides a concise summary and answer to the information I'm looking for.
So

It's memory.
is way better than mine, in fact.
This is why I think you should
Subscribe and you sage.
as a way to supplement the decisions that you make in your work.
You just heard me do this multiple times in the episode. So think about when Jensen was struggling with figuring out what product positioning is.
Ye uh the definition that I recalled was just me asking.
What is product positioning?
summarizes the best definition, gives us examples for every single thing we talk on the podcast.
when we talked about how the importance of educating a market
uh when you're sh when you're creating a new technology or a new product.
Like Intel did.
What I was reading you came directly from Sage. When I talked about
how Henry Singleton said what did Henry Singleton say about planning that five point I think it was five point bullet list.
That came directly from Sage when talked about
Uh the importance of
What's the leader's job? Uh you think of yourself as the leaders think of yourself as teachers. All the examples from Soul Price, from Henry Singleton, from Warren Buffett, from Bill Walsh, from Steve Jobs.
That came.
From Sage.
And so the big update is now when you log into founders' notes, it looks completely different.
If you if you haven't used it in a while.
Or if you've never used it.
The very first thing you see is the ability to ask Sage a question. The other update
That was really important to me.
was we added the ability to toggle between AI models. So we built the thing on chat GPT.
And you can still use that if you want, but the default now is Claude three point five Sana because that's the one I use. And
I it's it's spooky because when I essay to question
It sounds like me.
Except.
With a much better memory.
Um again, you can toggle between e whichever one you want.
And you'll find the one that actually you you feel is most helpful, but but but that's the one I've been using.
Uh another cool thing that we added as well.
When you log in, you see all these like suggested questions. Okay.
All of the suggested questions that you see when you log in, these are questions that I have asked Sage.
And I'm continuing to add to that list of suggested questions because as I keep searching and finding good
Questions and good answers. I add it to the suggested
prompts or the suggested questions.
list. So even if you didn't have a question you wanted to ask it, you could log in, see what I've been asking it.
And actually read and learn.
From that. But again, I think the main purpose is like
to use it as
You have any questions in your business, you should be asking Sage because then what happens
Is
It's essentially like if you could prompt all of history's greatest entrepreneurs to help you solve the problem that you're dealing with inside of your business.
I'm gonna continue
Uh
Get it making it improving it.
continuing adding to to it because again
This is a tool for myself. I literally cannot make the podcast without it.
I'm constantly adding to it just as a as a byproduct of natural byproduct of
the work that I do is for every single book, every single podcast, every single transcript, every single note, and just keep adding to it. So
If you want a way to tap into the collective knowledge official entrepreneurs.
on demand and use it to supplement the decisions that you're making in your work.
highly recommend you go to foundersnotes.com that is founders.
With an S.
Founders notes.
Just within us just like the podcast. Founders notes dot com and sign up today. Thank you very much for the extra support. Thank you for listening and I'll talk to you again soon.