Invest Like the Best with Patrick O'Shaughnessy
00:25:29 · Patrick O'Shaughnessy, Gavin Uberti
[00:25:29] S0: Can you talk about the competitive drive that's evident in some of the high school competitions that you participated in and won? [00:25:36] S1: We did a couple. For example, I was very active in the FTC robotics. I'd like you to have a very talented partner, Sanford, for a long time, be a part of a traditional school team, where it was about 20 guys, all working together as often typical of first tech challenge. And the goal is to go out and build a robot that scores the most points, and a bunch of other things too. And first, they put a lot of emphasis around collaborating with other teams, around trying to do really good documentation, around trying to go ahead and get others inspired to go do the same thing. Stanford and I decided, rather than go ahead and do it this way, we're gonna win. And we did nothing else beside the Boulder that scored the most points. [00:26:12] S0: As a two person team. As a two person team. Rather than a 20 person team.
00:26:12 · Patrick O'Shaughnessy, Gavin Uberti
[00:26:12] S0: As a two person team. As a two person team. Rather than a 20 person team. [00:26:15] S1: That we were much, much smaller than almost every other team in the competition. We figured that if we were gonna go specialize, if we were gonna go out and do this, win the damn games really well, we wouldn't need to go ahead and advance based on the quality of our documentation or of our outreach, we were just gonna go win. And so we did, we had branched off, built a two person team that built a robot and decided we were gonna go ahead and redesign it every three months, and we did. We actually had the world record for the highest score during this competition at one point. We were rated by OPR third in the world for software development, and, it was a damn good machine. [00:26:48] S0: What from that episode can I translate as an analogy onto how you built Etch the company? [00:26:53] S1: When thinking about how you want to go ahead and do a full RackScale product like this, there's a couple of key ideas. One of them is like velocity, velocity, velocity, that you win by shipping. You're not gonna go out and win by having the best outreach or the best communications, you win by building the best product. And similarly, we think we can go do it with a lot fewer folks, that if you're willing to go ahead and just focus on product, product, product and paralyze relentlessly, you don't need 20,000 people like the big companies have. You can do the best product in the world with far fewer people.
00:27:27 · Rob Wachen
[00:27:27] S3: Yeah. There's a saying of the best part is no part. I think for us, it's also the best vendor is no vendor. As much as possible, we wanna vertically integrate the entire product, both because we get more performance, but we can move way faster. So everything from the chips to the boards to the cold plates to the interconnects to even the production, We wanna do all of it as in house as possible. I think we're the only startup right now that's building its own rack as well as its own chips, and we did it all at the same time. A couple years ago was the last time we were public. At that point, we just started building our rack team, and we brought over Brian Loyler who built all of NVIDIA's HDX and DGX systems, which is, like, 80% of their revenue. And we said, we're gonna build the rack at the same time. We actually went through multiple iterations of the rack before the chips even came back. Before the chips came back, we made thermal chips that had the exact same hot spots as we expected our chips to have so we could build the cold plates, we could over pressurize them and blow them up. We haven't had a single leak since our chips came back with the cold plates because we already validated them. We have a factory in Taiwan, we have a few dozen people out there. We built a clone of a bunch of the test stations in our office. We have a two megawatt data center on this floor, and we did twenty four seven development cycles. People are doing day shifts and night shifts to actually get the hardware up and running as quickly as possible. But it's that extreme vertical integration and extreme parallelization of the schedule that lets you get products to market way faster.
00:28:41 · Patrick O'Shaughnessy
[00:28:41] S0: If you think about the building of the early team and what it required as two young guys building this company, there's lots of very talented young entrepreneurs out there, maybe for the first time of this scope or magnitude in a long time, all of whom probably could benefit from the lessons that you've learned, getting very sophisticated, talented people to come join you even after careers at the other great companies. If you were teaching this as a class, like here's how to get lead talent when you're young and inexperienced and naive, what would be the syllabus?
00:29:09 · Rob Wachen, Gavin Uberti
[00:29:09] S3: We have a pretty bimodal talent philosophy. It starts with what we call the legends, which is when we're trying to solve an incredibly hard technical problem and generally do something that hasn't been done before, we need to find the very best person in the world. And often, the number one guy in the world versus the number 10 guy versus the number 100 guy, huge difference in whether it's actually possible to solve the problem. We created the system we call project based recruiting, where we map out all of the hardest technical problems across all industries that anyone has ever had to solve. We look at temporality, so who are the people who did the zero to one? Who is in charge, quote unquote? Who actually did the work? We talked to as many people as possible, and then we just track it. And you'd be surprised by the amount of people who say yes after the first conversation is pretty low, but the amount of people who say yes after the twentieth conversation is surprisingly high. You really gotta keep at them. When you hear no from somebody who really is [00:29:58] S1: the best in the world, then that really means, hey, should go ahead and come back when you had a few more milestones proven out. I think it's one of the most convincing things to see is, hey, we make bold claims, and when you go ahead and hit those again and again and again, that is really belief inspiring.
00:30:13 · Rob Wachen
[00:30:13] S3: When we decided we wanted to build a rack and not just a chip, we were looking at this and we're saying, you know, how many products have actually shipped at scale for a rack scale system that actually have the power density that we're trying to solve? And we just kind of said, if we were gonna wave a magic wand, what would the best possible person in the world look like? And we're like, well, if we could find somebody who, like, started at NVIDIA and built the entire Rack team through all their different generations, learned all this different stuff, but is still scrappy, still understands the startup culture, but has seen scale, like, would be the best possible person. So we mapped all of the different teams that related to all of the different Rack Scale products at NVIDIA. And we found three people that we thought could fit the bill. And we talked to all of them, and two of them have just retired. And one of them was planning to do one more generation for NVIDIA and and then retire. His name is Brian. And over time, we convinced him to join. Brian started the HDX and DGX team at NVIDIA, which was, you know, a majority of NVIDIA's revenue, tens of billions of dollars a quarter. And the other two guys ended up investing, by the way. But when you have somebody like that, they just know what good looks like, you know, because they they've seen it. And there's so many times where we'd talk to Brian, he'd just point to us and be that's a billion dollar like, a billion dollar lesson I learned. A billion dollar lesson I learned. Like, yo, that just saves us cycles. And you pair someone like Brian with somebody like Sanford.