Business Wars: How Nvidia Owned A.I. | Once in a Lifetime | Episode 2

Host: David Brown (Wondery)
Release Date: December 24, 2025

Episode Overview

This episode explores Nvidia’s audacious transformation from a leading video game graphics chipmaker into the pivotal company behind the global AI revolution. Through risks, vision, and resilience in the face of deep skepticism, Nvidia’s journey is framed as a once-in-a-lifetime bet that ultimately redefines the tech landscape and cements Nvidia as the most valuable company in history.

Key Discussion Points & Insights

1. Launching CUDA: Betting the Company on an Uncertain Future

• Setting the Stage (00:08):

  • In 2007, Nvidia launches CUDA, a platform enabling its GPUs to perform high-end computational tasks, aiming to attract scientists and technical professionals rather than just gamers.

• Investor Skepticism (01:18):

  • CEO Jensen Huang fields tough questions from analysts about CUDA’s commercial prospects.

    "We're creating an entirely new customer base for our company. Our graphics chips offer 10 to 200 times the performance of general purpose chips. We're about to enter the era of the GPU." – Jensen Huang (01:18)

• The Vision vs. The Market (02:33):

  • Despite CUDA’s capabilities, most see its market as niche and its risks as too high.
  • Nvidia must “create a market that doesn’t exist yet,” with Wall Street's patience running thin.

2. The Academia Gambit: Seeding Adoption Through the Classroom

• University Pushback (05:00):
  • Attempting to seed CUDA in academia, Nvidia’s offers of free hardware are rebuffed due to the steep learning curve and unfamiliarity with parallel computing.
  • Metaphor:

    "You can think of a CPU like a single lane street... GPUs, on the other hand, are more like multi lane highways." – Host (06:45)

• Breakthrough with Illinois (08:53):
  • Chief Scientist David Kirk begins teaching a course at the University of Illinois, planting the seeds for CUDA’s academic legitimacy.
  • Peer-to-peer adoption grows as research gets published and faculty request teaching materials.

3. The AI Killer App: Proving the Potential

• Stanford’s Cat Video Milestone (12:40):
  • In 2010, Stanford’s Andrew Ng and Google use Nvidia GPUs to teach neural networks to recognize cats on YouTube, proving GPUs can radically speed up machine learning.

    “The cat recognition algorithm that once required 2,000 CPUs now runs on just 12 Nvidia chips. It’s a great leap forward for AI research.” – Host (13:56)

• Turning Point:
  • This success is the “proof of life” that tells the story better than any technical spec, making CUDA’s value relatable.

4. Struggles with Wall Street & Activist Investors

• Investor Apathy and Cuda’s “Vanity Project” Label (15:00):
  • Continued low adoption and revenue convince investors CUDA is a dead end, prompting hedge funds like Starboard Value to circle and pressure Nvidia for immediate returns.
• Activist Investor Showdown (19:10):
  • In 2013, Starboard Value’s CEO Jeff Smith demands Nvidia refocus on profit and scale back CUDA. Huang concedes a $1B stock buyback but refuses to kill CUDA.

    “In business, survival depends on knowing when to give in and when to dig in.” – Host (24:23)

5. The Once-in-a-Lifetime Pivot: CUDNN and AI Domination

• Internal Innovation (26:09):
  • Nvidia’s Brian Catanzaro proposes CUdnn, a CUDA extension for deep learning, directly to Jensen Huang.

    “I cleared my entire schedule so I could spend the weekend reading and making calls about this. I believe this project could be the most important one in Nvidia’s entire history.” – Jensen Huang (26:09)

  • Huang’s mantra:

    “From this second, we are no longer a graphics company. We are an AI company.” – Jensen Huang (27:28)

• Organizational Agility:
  • Huang restructures Nvidia to move quickly toward dominating the AI hardware market.

6. Strategic Plays: OpenAI, Crypto, and Defensive Acquisitions

• Supplying the Future: OpenAI & DGX1 (29:00):

  • In 2016, Huang gifts OpenAI its first DGX1 AI supercomputer.

    “To Elon and the OpenAI team. To the future of computing and humanity, I present to you the world’s first DGX1.” – Jensen Huang (30:55)

• Crypto Mining Boom & Bust (32:00):

  • Surging cryptocurrency demand repositions Nvidia's gaming chips as crypto miners, inflating sales, then causing volatility as the market crashes, leading Nvidia to retool its product strategies.

• Fighting Intel for Mellanox (35:00):

  • Huang outmaneuvers Intel to buy Mellanox for $6.9B, ensuring Nvidia controls critical data center networking infrastructure.

7. Missed Mega-Merger and Rising Market Power

• The ARM Deal (37:30):
  • A $40B bid to acquire ARM, aiming to make Nvidia a one-stop AI shop, is blocked by regulators for antitrust concerns.
  • Nvidia moves on without losing momentum, demonstrating resilience and adaptability in strategic planning.

8. The ChatGPT Explosion & Nvidia’s Crowning

• AI’s Tipping Point (41:30):
  • ChatGPT’s launch in November 2022 triggers a global AI boom, and hardware demand shifts decisively to Nvidia.
  • By May 2023, Nvidia becomes the world’s sixth most valuable company and, by October 2025, surpasses $5 trillion in market cap—becoming the most valuable company in history.

    "To put this in perspective, that's more than the annual value of the economy of Germany." – Host (43:02)

9. Global Battles and Threats to Dominance

• Geopolitical Roadblocks (45:00):

  • U.S. export restrictions (alternately tightened and loosened under different administrations) keep Nvidia’s most advanced AI chips out of China, risking the rise of Chinese alternatives.

• Rivals Close In (47:00):

  • Entrenched competitors (AMD, Huawei) and major customers (Amazon, Microsoft, Google, Meta) are developing their own chips to sidestep Nvidia.

• Software Moat: The CUDA Lock-In (49:00):

  • CUDA remains a sticky advantage, making a hardware switch costly for developers and slowing down would-be Nvidia challengers.

10. Lesson in Longevity and Ruthless Adaptation

• Survival Mindset:
  • Despite its massive lead, Huang’s legacy is a relentless focus on adaptation:

    "His old mantra that Nvidia is just 30 days away from bankruptcy may not fit anymore, but the mindset still does." – Host (49:44)

• Final Reflection:
  • The episode closes on the theme that even the mightiest tech giants can be toppled unexpectedly, underscoring the importance of strategic foresight and agility.

Notable Quotes & Moments

• Jensen Huang to skeptics (01:18):

  "We're creating an entirely new customer base for our company."

• On academia’s impact (08:53):

  “Think of this. Instead of buying billboards, Nvidia bought something a whole lot more durable. Credibility.”

• Host on 'proof of life' for CUDA and AI (13:56):

  "People don't remember tenfold efficiency gains. They remember how cat videos taught computers how to see."

• Huang's excitement about CUDNN (26:09):

  "I cleared my entire schedule so I could spend the weekend reading and making calls about this. I believe this project could be the most important one in Nvidia’s entire history."

• Huang declares Nvidia’s new direction (27:28):

  "From this second, we are no longer a graphics company. We are an AI company."

• On Nvidia's market value (43:02):

  "That's more than the annual value of the economy of Germany. Nvidia is now the most valuable company that has ever existed."

Timestamps for Critical Segments

• Investor skepticism & CUDA’s debut (01:18–02:33)
• Attempt to seed universities (05:00–10:00)
• Stanford & the cat video neural network breakthrough (12:40–13:56)
• Investor revolt & Starboard Value negotiations (19:10–24:23)
• Huang repositions Nvidia as an AI company (26:09–27:28)
• Nvidia’s partnership with OpenAI—DGX1 moment (29:00–31:06)
• Crypto mining impact and Mellanox acquisition (32:00–35:00)
• Blocked ARM acquisition & strategic lessons (37:30–40:00)
• ChatGPT launches, AI boom begins (41:30–43:02)
• Global, regulatory, and competitor threats (45:00–49:44)

Conclusions

Business Wars vividly illustrates how Nvidia’s fate hinged on unyielding vision, strategic patience, and the ability to pivot as technology and markets evolved. While they faced skepticism, failures, activist pressures, and headline-grabbing setbacks, Jensen Huang’s stubborn belief in the AI future transformed Nvidia into the most valuable and strategically critical company in the world. The episode ultimately serves as a masterclass in business resilience, adaptation, and the relentless pursuit of the “once in a lifetime” opportunity.