John Kim’s Post

Nvidia, Apple, Microsoft, and Alphabet are the four largest companies in America with a combined market cap equivalent to 44 percent of 2023 GDP. They rely on continuing innovation to maintain and increase their value, innovations usually conceived and initially developed by startups that patent them, and then sell their exclusive rights or themselves to these and other large companies.  The innovator’s legal patent protections have weakened in recent years, but a new case against Nvidia is trying to restore them. To learn more, check out my recent Fortune op-ed: https://shorturl.at/Za3wI

I ran into this post on X by Sean Kelly the other day about how Jensen Huang manages at Nvidia. It really resonated with the way I think tech leadership works. I see an innovation company (i.e. startup) as an organism of multiple people, and not a machine of multiple skill-sets. So it must be managed and lead in a people-centric way, and not with a mechanic focus on processes and bureaucracy. The key points for me are: - Flat Hierarchy. Everyone has a voice regardless of their level, role, background or expertise. Very often, great, innovative ideas come from less senior people. Make sure no one is afraid to speak to anyone. - Continuous Planning - relates to R&D. When working on innovative tech, namely with proper Research, it is frequently impossible to actually plan concrete developments even in the mid-short term (e.g quarterly). Instead we should adapt our planning processes to consider expectations, hypothesis, trials, pilot experiments and tests. And “plan” that the next steps will be further defined based on the results. The only actual plan here is what we are trying to achieve - what is our problem statement, or a KPI (measure) we are trying to optimise? Other then that we may attempt to time-box certain experimental (trial-and-error) developments, but we can’t plan when the research will be completed. The plan should be somewhat clear for the next couple of weeks or couple of iterations, but the team - and project management - must know that it is never written on stone, and that effort and team velocity are not linear measures that can represent a team’s productivity. If your company works in tech that requires R&D, then you should incorporate continuous/flexible planning and consider methods of performance measurement beyond the typical Agile ones- otherwise you think you have R&D but you really don’t. - Direct Updates. It always seems like providing updates to an executive leadership through indirect updates tends to incur in additional effort for all parties, catalysed by increased misunderstanding. If you are working on or leading a particular project or piece of a project, you should be the one describing how it’s going, what the current issues are, and what you think or expect the next steps should be. Often indirect updates suffer from a wobbly effect where the edges are firmly fixed to the expertise, but the intermediate levels (of management) may be wobbly and either miss out on certain relevant details, or unknowingly distort some of the information. Finally, Open Decisions. As a team member, we frequently adjust our decisions making and even performance to the timing and requirements of both the company and projects. Without transparency a team will actually become a blob of multiple out-of-sync blobs. If you try to fix it with more levels of management you actually increase the opacity and the problem. Make sure the team always understands the motivation behind decisions and where and why we are all heading.

Incredible partnership with San José State University, City of San Jose, and Nvidia to use AI for civic good and workforce development. "How we further research using AI, projects using AI, and innovation using AI-infused technologies. Nobody else in the world can do what we're going to do here," said San Jose State President Cynthia Teniente-Matson "We're already experimenting with AI. We're speeding up bus routes. We're improving language translation. We're proactively identifying potholes and dispatching city teams to repair them faster," said Mayor Matt Mahan. SJSU Faculty: Nvidia is offering their education modules for free to educators at San Jose State to help them learn about the technology.

Interesting approach 💡 given the number of challenges and issues that can be traced back to inefficient communication or lack of transparency, this is definitely something to dive into for leaders all around ⬇️ Any opinions on this?

I have proven this to be true, from both viewpoints.

What distinguishes the 0.4% of founders who start a company and keep running it three or more years after it goes public from the other 99.6%? As I wrote in #BrainRush, the answer is #cognitivehunger. NVIDIA CEO #JensenHuang puts cognitive hunger to work so employees, customers, and shareholders are better off. Here's how.

It's true, capitalism is the most effective driver of innovation and wealth creation. When a company gets it right… magic happens. This was the case with a company that was able to successfully align the interests of founders, employees, and shareholders and turn a large amount of them into millionaires. Let’s break down the success story of this well-known magical company. Doing so provides a compelling case study that illuminates the potential of well-aligned incentives in the capitalist system. The company is Nvidia and what they have done has been simply amazing. - The Nvidia Phenomenon Imagine a company where 76% of employees are millionaires! Even better yet, one in three boasts a net worth exceeding $20 million. This isn't a thought experiment. This is the reality at the company Nvidia. According to a recent survey of 3,000 employees at the company, Nvidia has created over 25,000 millionaires. Yes over 25k millionaires all created from one company. Outstanding! And nearly half (12,000) of those employees/team members at the company boast a net worth of over $20 Million. If these figures hold true across their entire workforce, we're looking at potentially 25,000 millionaires and 12,000 multi-millionaires created by a single company. But How? It happened from well-aligned incentives within the company. The Perfect Storm of Aligned Incentives 1. Visionary Leadership: Jensen Huang and his team identified a crucial need in the market for high-performance chips for AI and graphics processing. 2. Employee Buy-In: Nvidia's employees weren't just slaving away for a weekly paycheck. They had buy-in and were deeply invested in the company's success through stock options and a shared team vision. 3. Shareholder Value: Nvidia's shareholders have seen unprecedented returns.  The company's market cap increased by over $3 trillion since ChatGPT's launch. 4. Societal Impact: With Nvidia’s AI innovation, they are helping drive broader technological progress and creating societal value beyond just their within the company. This incentive alignment created a virtuous cycle at Nvidia. As the company succeeded, everyone involved benefited. This motivates everyone towards further innovation and growth. Nvidia's story isn't just about one company's success; it's a testament to what's possible when capitalism functions at its best. When companies solve real problems and meet market demands, they can generate immense value. This value, when properly distributed, can create widespread prosperity... ... not JUST within the company that created it. Nailing incentive alignment structures is one of the most important jobs that any CEO can perform. Get it right.... and magic happens!

Sometimes, the good news is drowned out by the horrific noise of the bad news. However, last Monday, Globes גלובס shared an amazing interview with the CTO of Nvidia in Israel. For those of you who don't know, Nvidia are mega successful. They do something wow with microchips. And they are getting even bigger by the second. Is their a magic formula to this success? The article is full of interesting anecdotes. But the outstanding lines for me are tucked away in the middle section: "Each and every day I hire 4,000 employees, and at the end of each day, 4,000 people go home and I have to make sure they come the next day. We pay a lot of attention to our people and that is the basis of everything. If a company cares about its people, they will want to work for it, because ultimately nobody in the high-tech field is hungry for bread." The boss cares and shows that he cares, every day. That is #leadership! Can somebody clue in the Israeli government to this post?

#wednesdaywisdom #communication Wow! What an unique perspective. This is a prime example of open communication, emphasizing the importance of feedback and learning from others’ mistakes. This may sound contradictory, but the receivers must all be in the same mindset to accept such a style.

Fascinating. I’m a huge believer in 1:1s to empower my team. They’re touch points, as I have faith in their ability to do the job (that’s why we hired them!) - is everything on track, do you need more resources/expertise, and, most importantly, are you okay? The flip side of removing so much bureaucracy from an organisation is compelling - having so many people closer helps disseminate knowledge and remove the game of chain-of command “telephone”. I’m not sure it’s very well suited to multiple personality types, neurodivergent folks, etc. re: creating an environment where they can thrive. And I’ve seen countless people from CEOs to 1LMs burn out from having 9+ direct reports. 1) what do you think? 2) does it change for remote organisations?