Disclaimer: 100% human authored – no ChatGPT or any AI tool used to author this post. Though I did ask ChatGPT to generate an earnings analysis of Nvidia to research their top 4 customers.
Nvidia is having a moment. Fad or not, the ascending company is currently providing one of the most vital technologies in the modern world. Most of us are gutted because we didn’t have the foresight to buy the stock in 2010, 2015, 2020 or even in 2023. And while Nvidia could still continue its epic rise, I’m not here to talk about stock prices.
I’m here to talk about product marketing, sort of. Nvidia’s success story is all about identifying market needs, understanding customers and delivering outstanding value far and above the competition. My narrow understanding is that Nvidia was great at providing the advanced graphics processing units (GPUs) required for the video gaming segment in its early days. It was not a long term strategy (I don’t think) to apply these GPUs to the current Generative AI revolution. That happened by extension as OpenAI released ChatGPT. Then investors really started connecting the dots and it didn’t take long to realize that anyone wanting to participate in building AI applications would need Nvidia.
Yet the real story for me is that Jensen Huang managed to identify a product market fit early in Nvidia’s journey which at the time was taking GPUs designed for the video gaming segment. He organized a market-driven strategy to summon the advanced design and engineering wherewithal to meet the demands of that segment. It’s textbook product marketing on the one side, teamed with stellar engineering on the other. I admit that PMMs aren’t marshaling engineering resources on a daily basis or have even remotely as much pull as a CEO does. But on some level, Nvidia is partly a product marketing agency for TSMC. I said “partly” because Nvidia is still designing chips in house and does a million other things, but they are really great at bringing market expertise and strategy to the table as a key value addition to TSMC technology, similar to how PMMs function when bringing our products to market.
The scale of the complexity that Jensen Huang navigated through to ultimately succeed in one of the most important technology markets of all time is remarkable. Nation states are literally investing entire spy agencies around winning at this AI chessboard right now. How did Jensen do it? Well, he put his PMM hat on!
Let me explain. He leveraged an amazing relationship between customer knowledge in target market segments on the one side; and with advanced technology made at TSMC on the other side. In this way he served as a nexus between these two dynamic forces, ultimately driving forward the iterative development of a product based on customer insights, translating it into market success by addressing adjacent segments (GenAI) in the future. He knew his markets, knew his customers, knew his products, and when it came to telling the story, he knew his audience — he is an amazing storyteller.
I watched his keynote at Nvidia’s annual user conference and I can honestly say it was one of the first times I rewatched a keynote because I was so inspired by the scale of the innovation and products being introduced. He organized the keynote into such precisely engineered sections that it almost resembled a micro-chip in complexity – yet it was a story nonetheless. By the way if you haven’t watched it, here it is:
This keynote supports my argument that Jensen is an inspiration for PMMs because at every step in this keynote he is taking products and delivering a message that inspires an audience. I’ll be watching Nvidia’s market story unfold in the coming years. Will he step up to the challenge of continuing to drive innovation? I am amazed that Nvidia’s stock has been pummeled in recent weeks not because they aren’t delivering results, but because they aren’t going “above and beyond” expectations. It’s getting a bit comical.
Yet if you observe the market opportunities that lie ahead for Nvidia, and the lax performance of peer rivals that could amass a viable opposition to Nvidia’s advanced GPU designs, the only thing that could destroy them is themselves. Wait, let’s quickly challenge that. There’s a variety of geopolitical forces that could disrupt TSMC which would cut Nvidia’s legs off. Or if the hyperscaler / Big Tech customers — the largest consumers of Nvidia’s GPU’s — begin their own chip production that could be a threat. I’m referring to Microsoft, Meta, Google and Amazon which account for ~40% of their revenue. But for these companies to step on Nvidia’s territory would mean either they go direct to TSMC, or production miraculously becomes an endeavor that doesn’t cost tens of billions of dollars and decades of know-how to figure out. So all in all, the odds favor Nvidia if Jensen can keep ahead of the curve which he certainly has demonstrated a propensity to do. The final risk I’ll mention is seeing the AI bubble burst and all investments discontinue – which by all accounts seems very unlikely since even the “.com bubble” in the early 2000’s was actually a preamble to the creation of Big Tech ever since. There will be some very big winners with AI, even after the bubble bursts.
By the way, the partnership with these large companies is also a testament to Jensen’s PMM-ness. Having 4 massive whales as customers versus trying to find 4 million little fish was smart. And the funny thing is that those 4 whales for the most part hate each other, so he managed to generate a coalition of surging demand among enemies and turned their ambitions to defeat each other into an advantage. There’s another example of Nvidia applying market strategy, a tenet of effective product marketing. I think it also proves that great CEOs are partly PMMs, or at the very least should listen more to their PMM teams.
You get the point. Nvidia has married market strategy, customer obsession and product excellence to carve out an astounding amount of value in record time, and is now worth more than most countries are. Most of us PMMs are operating at a fraction of a fraction of the scale that Jensen is, but still, we are trying to do something similar, whether as solo PMMs at startups, or on a team of 50 PMMs at a Fortune 100. We aspire to bridge market understanding with product innovation to serve customer demand and win in competitive markets.
In conclusion, I’ll be tuning into Jensen’s next keynote, and I’m hoping to replay it with a wide-eyed sense of inspiration again. Perhaps inspiration is really what the takeaway is here. To me, that’s Jensen’s secret, creating inspiration – this is perhaps the greatest skill a PMM can have and he is a master at it.
