Nvidia is a powerhouse today.
Jensen Huang has built Nvidia into a $2.5 trillion company using the same frameworks for almost 30 years.
Any time he felt stuck and couldn’t find a way forward he always went back to the same principles.
Principles that even when he was about to lose everything he was able to tap into them and bounce back to greatness.
If you don’t have the time for the full story here are the key takeaways.
Key themes
Have a strong network: working with and being exposed to the right people brings you all the opportunities you need.
Move quickly: every day you don’t take action is a day you are losing money or losing potential earnings.
Use the past to learn and leverage first principles: learn about what worked well in the past and think about how current opportunities and tools could make it work today.
Work on difficult things: if you are seeking to make huge waves, work on the things that if you don't work on it, no one will.
EIOFS: early indicators of future success. The best way to know if a market will be viable is to assess if what you are working on will advance your field substantially.
Those here for the ride, let's go.
1. A Strong Network
In a land before generative AI and Nvidia, Jensen Huang worked at LSI Corporation. He spent time there building his reputation and expertise.
He built this reputation to be valued at $20 million.
How $20 million? Because that’s how much money he received to start his company when others said it was the worst pitch for a company they ever heard.
You see it all the time, founders who are pre-product who can raise millions and others who had to build, generate money, and get traction before they could get $5.
Think about it like an orchestra. Jensen Huang could’ve been an average violinist.
If he played with Gustavo Dudamel at the LA Philharmonic for 8 years and then left to start his own orchestra people would come watch because of who he’s been around.
If on the other hand, he was a self taught genius and said I want to host a concert, he’d probably only be able to get half of his family to show up.
He started his career around some of the best in his field and continued to surround himself with the best. He was able to make better products, start industries, and receive all the funding he needed because of his network.
2. Move Quickly
When he started his company he picked up a book that could help him write a business plan. It was 275 pages. He flipped through a few pages and thought “ By the time I’m done reading this thing, I’ll be out of business. I’ll be out of money.”
He took action and figured it out on the way.
But let’s be real, he was able to do this because he was in the market for almost a decade. Every single one of his decisions that allowed him to move quickly was because of years of experience.
It’s as if he was an F1 driver. In the heat of the moment, a decision can be made to avoid a crash in 200 milliseconds, that’s fast considering a blink can take between 100 - 400 milliseconds. The only way the drivers could do this is through deliberate practice.
3. Use The Past To Learn And Apply First Principles
This was just like Albert Einstein when he tried to figure out how gravitational forces worked.
Einstein leveraged everyone's work who came before him: mathematicians, physicists, scientists, and everyone else to be able to break things down and rebuild them back up to answer some of the most difficult problems.
Jensen Huang did the same thing. He would always read archive papers to break down what worked and thought, given today's conditions, his motivations, and new tools available, how could this be reinvented today.
He did just this when he built one of his new graphics cards. He was struggling hard, so he took his daughter Madison to their local book store Fry’s Electronics. As he tried to relax he saw it. A book that would change everything.
A Manual on how Silicon Graphics did computer graphics, he bought three copies, shared it with his co-founders and they ended up building the best graphics cards in the world.
4. Work On Difficult Things
He once said that he wanted his company to be lazy.
Lazy about doing things that other people always do. He said you should work on the things that if you didn’t do it, the world would fall apart.
He was like a modern-day explorer, showing the world that it isn’t flat. While other men sat around drinking and gossiping he did the hard stuff.
For 7 years he ignored his customers, they didn’t understand the vision he was going for and he was trying to create a new market. Up until that point 3D graphics were so expensive and exclusive to those that had long pockets.
It took Electric Art and Microsoft’s success for him to finally get people behind what he was doing with graphics cards. Everyone before said his chips were too big, too expensive, and they wouldn't give him a dime.
5. EIOFS
Early indicators of future success and working on difficult things gave him what he needed for extreme success.
He thought about early indicators simply. If this advances science in a way that matters he’ll do it.
He didn’t need to see a financial forecast or business model, he just needed to understand if this was important.
If you look back and see what Nvidia got right, it was some of the most impressive things that changed the world as we know it.
Jensen Huang has been like a master sculptor striking a white marble precisely to reveal a masterpiece. Using the same few tools to reach greatness.
Recap:
The combination of a strong network, quick action, learning from the past, tackling difficult problems, and focusing on early indicators created one of the most resilient and innovative companies of all time.
One way I think about these case studies is like a version of first principles thinking. Learning how those previously did gained success then reimagining how things can work for you in today’s environment and with your tools.
Stay curious and I wish you the best. Thank you for reading.
