In the early days of Silicon Valley, around 200 companies were starting 3D graphics businesses. Now, NVIDIA is the only surviving computer graphics company. Jensen Huang attributes this success to understanding the core essence of the business, which is semiconductor technology and Moore's Law. Despite initial customer disinterest, the company focused on making their graphics processors twice as good every year, leveraging the insatiable demand for 3D graphics. For the first five years, NVIDIA ignored customer feedback, believing that customers didn't understand the business's nature during its formative years.
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00:00Everybody in Silicon Valley was starting a 3D graphics company.
00:03Over time, we competed with about 200 companies.
00:07NVIDIA today is the only surviving computer graphics company in the world.
00:11And so the question is then, what happened?
00:13I always believed that you need to understand the reason why your business works.
00:18What is the essence of your business?
00:20Now, the foundation of my business, at its core, is semiconductor technology.
00:24Here in Silicon Valley, we usually like to refer to semiconductor technology as Moore's Law.
00:28Moore's Law approximately gives you twice the performance every year or two.
00:32It was insatiable that if I made something twice as good every year,
00:36even if the customer never asked for it,
00:38even if the customer, when you went to float that product specification to them,
00:42told you that they're not interested.
00:44When your customers all tell you not to do something, the question is then, what do you do?
00:49In our case, because we had this unique perspective that 3D graphics was insatiable,
00:54and Moore's Law was our friend, therefore,
00:56we should make our graphics processors twice as good every year.
00:59And so for the first five years of our company,
01:01we just turned off our blinders and said, we're going to ignore customers.
01:05And the reason for that is because they don't know the nature of your business.
01:08And while the industry is being created,
01:10before there's common sense about the rules of that business,
01:13there is no way they can possibly know.