No Priors: Artificial Intelligence | Technology | Startups
00:00:00 · Lip-Bu Tan, Sarah Guo
[00:00:00] S0: Nine of the 10 company I invest, halfway they change their business plan because market have changed. Yeah. So I like to have entrepreneur as team, not just one person. I always believed in when I was at Cadence and also at Intel is first of all you crawl and be humble, listen to customer. And then first step for me is to strengthen my balance sheet, focus on the products, and I really simplify the product, listen to the customer, and then drive the next generation leadership products. And then right now, the agentic AI and influence CPU become highly in demand. And so in some way, I'm happy. Right now, the demand is very high for my CPU. Secondly, very happy that Jensen Huang, my all time friend, he also put 5,000,000,000 in investing and support me. This 5,000,000,000 become 25,000,000,000 now. If you look at it ten years from now, what are we be the winning company? The one that [00:01:00] S1: Hi, listeners. Welcome back to No Priors. Today, Elad and I are here with Lip Bu Tan, the legendary investor from Walden, then CEO of Cadence, now CEO of Intel. We talk about his plan to transform Intel, having the US government as a major shareholder, how to be an amazing semiconductors investor, and whether or not we can make chips in The United States. Welcome, Lip Bu. Lip Bu, it's great to see you. We'll start with the obvious question. This is a really hard job to go be CEO of this incredibly important American semis company. Why take the job at all?
00:01:00 · Sarah Guo, Lip-Bu Tan
[00:01:00] S1: Hi, listeners. Welcome back to No Priors. Today, Elad and I are here with Lip Bu Tan, the legendary investor from Walden, then CEO of Cadence, now CEO of Intel. We talk about his plan to transform Intel, having the US government as a major shareholder, how to be an amazing semiconductors investor, and whether or not we can make chips in The United States. Welcome, Lip Bu. Lip Bu, it's great to see you. We'll start with the obvious question. This is a really hard job to go be CEO of this incredibly important American semis company. Why take the job at all? [00:01:33] S0: It's a good question. I'm 66, and people thought, wow, you should retire rather than taking on this hardest job in the industry. And so a couple of reasons. One is this is an iconic company, and it's so important for the semiconductor ecosystem and also so important for United States. And so I decided to do one more after Cadence. [00:01:57] S1: A lot has happened in this past year. What has been most surprising to you?
00:01:57 · Sarah Guo, Lip-Bu Tan
[00:01:57] S1: A lot has happened in this past year. What has been most surprising to you? [00:02:02] S0: Well, the most surprising that I don't learn from my previous job or even training is one day early morning, President Trump asking me to resign, and conflict of interest, and there's no exceptions. And so I had to convince myself, first of all, I don't need this job. I do it purely to save Intel. And so take that personal issue out of the way. Then I figure out, what can I do to be helpful to Intel? And so good news is I have a meeting, you know, Thursday morning, and then Monday, I have the meeting. And then he listened to me like I have a chance to explain myself. And I was born in Malaysia, grown up in Singapore, went to MIT, and I live in US. I never lived outside country. And so something that I share, and that somehow he listened very well. And then he gave me the chance, and so I'm delighted. [00:02:57] S1: And now you have the chance to do the work. When you said, you know, the job is to save Intel. It's a really important company. What does that look like to you? What does Intel winning or thriving look like?
00:03:07 · Lip-Bu Tan
[00:03:07] S0: Yeah. I just passed fourteen months. A lot of things happened in this fourteen months. So a couple of things. One is to change the culture and then clearly want to drive more accountability. And also in terms of decision making, had to be faster. You know, I'm so used to startup culture, and you move fast in the speed of light and going to have that bureaucracy layer of layer of meeting. And so something that I change accountability, listened to the customer, and the customer delighted. Someone like Lipo, so humble, willing to listen, and then address some of the problem that they face, and then try to delight the customer. And also the other part, from day one, I decided all the engineering report to me. Being an engineer by training, I want to know what went wrong and what are the things that I need to correct, listen to the customer, and delight the customer, and then make sure that we have the right product, simplify our product line, and really have the road map and the vision for the next five, ten years. What is your vision of where Intel should be in ten years? Yeah. I think a couple of things. One, I always believed in when I was at Cadence and also at Intel is, first of all, you crawl and then be humble, listen to customer. And then secondly, you're starting to walk. And then finally, you're starting to run-in sprint. So that's kind of my culture of step by step doing it. And then first step for me is to strengthen my balance sheets. And the balance sheet is really horrible in some way, so I'm delighted. You US government become a big shareholder. Just I explained to president Trump, TSMC, when they started, they have the Taiwan government as a shareholder. If you look at Japan, look at Singapore, this is the infrastructure US government get to provide the support. Secondly, very happy that Jensen Huang, my all time friend, he also put $5,000,000,000 in investing and support me, and I'm glad I at least do some good work. His $5,000,000,000 become $25,000,000,000 now and or more. And then the other part is SoftBank Master. I used to be at SoftBank Board, and then he lent a hand to help me. So we strengthened the balance sheet and then focused on the products. And I really simplified the product, listened to the customer, and then drive the next generation leadership products. And then in some ways, very lucky.
00:05:35 · Lip-Bu Tan
Right now, the AgenTeq AI and Influence CPU become highly in demand. And so versus one to eight in the training CPU to GPU, now I can see one to four, maybe one to one, and I'm delighted CPU become important. I talked to some of the AI model and developer, and they said, well, in terms of reinforced learning, in terms of the speed of orchestrating all the agents, and turn up the CPU is actually is better. And so in some way, I'm happy. Right now, the demand is very high for my CPU. So I think overall, build on the product, on the data center server side. Then the other part is our foundry business. And initially, this is a capital intensive business, and it's not easy. And you really need to have a couple of things. You need to have all the right IP so that you can support the customer. Like for example, if it is mobile related, you've got to have low power IP set that you need to have. Without that, you cannot serve them. It's a service business. It's a trust business. If people want to give you orders to have wafer to come, if the yield not good, they will be close in terms of revenue miss. So with that, I think it's very important to really focus on the yield, the defect density, the cycle time, and then make sure that you're really able to meet and serve the customer in high quality and reliable. And so those are the things that I really focus on it. And eventually, you have to really move into a full stack. So not just a silicon, you need to have a software. And some of the customer asked me, give me the whole rack. So there's a system that you have to build. And so I think those are the things that are quietly building step by step and recruit some of the best talent I can find. By the way, all the recruitment, I do it myself. No search firm helping. And so I think sometimes it's good to have a rode deck that you know who to reach out to call for.
00:07:33 · Elad Gil, Lip-Bu Tan
[00:07:33] S2: Yeah. I mean, you've been in the business for so long and, you know, you've you've run Cadence for, I think, twelve years before this. And so [00:07:39] S0: Thirteen years. Thirteen years. Sorry. Oh, yeah. Sorry. Didn't more years as executive chairman. So fifteen years. Fifteen years. So I signed up for three months Three months, so right now, I'd be very careful. The moment you said, I'll just do it for three months, it turned out to be fifteen years. [00:07:53] S2: Yeah. Well, it seems like you have a lot of longevity ahead of you here as well. And so the other big initiative that has been sort of talked about is TeraFab and working with Elon Musk on that. Can you tell us a bit more about how that came together and then your involvement and how you all are collaborating?