Why Is Jensen Huang $120 Billion Richer Than You?

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There are two contradicting yet true things about Nvidia and its CEO, Jensen Huang.

First: Huang’s story is the rousing, full-chested, only-possible-in-America narrative that we all love. His Taiwanese parents sent him to live with his aunt and uncle in the United States as a child. In the hopes of getting him into a good college, they shipped him to a boarding school in Kentucky. His parents didn’t understand that this wasn’t a fancy college prep school but a reform school for troubled children. Still, Huang made it through alongside roommates with knife scars and tattoos. Then, through a combination of his work ethic, technical prowess, long-term thinking, and a generous cash infusion from Sequoia Capital, he spent 30 years building a company whose silicon chips are almost single-handedly powering the AI revolution. Nvidia is now worth $3.45 trillion, and Jensen alone is worth $120 billion.

This is amazing, laudable, and inspiring. It has all the story beats of a good opening segment on 60 Minutes.

Second: This narrative is kind of, sort of, a Texas Longhorn’s first cup of coffee—aka bullshit.

Yes, Jensen is an immigrant. Yes, he is incredibly hard-working and charming. Yes, he created a technology that no one had the guts to dream of despite it being unclear how it would be used in the future. Yes, he built a unique culture of hard work and focus that stands out from the lackadaisical nature of many big companies.

However, Nvidia stumbled upon most of the use cases—including AI training runs and crypto mining—that it’s powering with its technology. It did not invent the transformer, nor did it buy Bitcoin in 2013. Huang saw that his company's chips, originally intended for gaming, could be used for so much more, and then bet the farm on that direction, with no idea of the destination. It was a combination of ambition, patience, and a whole lot of self-made luck.

His story, Nvidia’s story, the AI story today, are all variations on one story—the central fable that defines 50 years of Silicon Valley’s success.

I’ve read dozens, if not over 100, books on the history of successful companies. The most recent was The Nvidia Way: Jensen Huang and the Making of a Tech Giant by Tae Kim. Kim did an exemplary job portraying the central characters, the risks they took, and the multiple near-death experiences this company had. It is an important read because Nvidia is one of the most important companies in history.

However, if you scan enough of these books, they start to blur together into one. Nvidia and Jensen are embodiments of the two crucial components of what has sustained Silicon Valley:

Messianic cultures
Long-suffering patience for profits

Make Silicon Valley culty again

I have a friend who has worked at Nvidia for many years and has become a millionaire many times over. When I asked her about what has changed over that time, she replied, “The cars are still in the parking lot till 7 p.m., but they’ve changed from Nissan Altimas to Porsches.” Nvidia is known to have a hard-working culture regardless of its size.

This culture originated at the top. Kim tells the following story, which is so good I couldn’t bring myself to cut a word:

“Employees dread whenever Jensen goes on a rare vacation because he tends to sit in his hotel and write more emails, giving them even more work than usual.

During Nvidia’s early days, Michael Hara and Dan Vivoli tried to stage an intervention. They called Jensen: ‘Dude, what are you doing? You are on vacation.’

Jensen replied, ‘I’m sitting here on the balcony watching my kids playing in the sand and writing emails.’ ‘Go out and play with your kids!’ his subordinates insisted. ‘No, no, no,’ Jensen refused. ‘This is when I can get a lot of work done.’”

I am not arguing that this complete commitment to work is required for outsized outcomes, but I do believe that Nvidia’s hard-driving, fast-paced culture was a key component of its success. In its early years, because of its focus on hard work and speed, the company shipped its chips at twice the speed of its competitors, and the market rewarded it for that. But there are many companies whose employees don’t work at this pace that do great for themselves.

The real lesson is that Nvidia’s culture was well-suited to the market it was attacking. I call this concept culture-market fit...

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