It’s causing a frenzy in the tech space, but it’s not a startup. You probably can’t call a company that has not only come of age, but has turned 30 that way. After all, when the term startup was born, it was still unknown. Nvidia, a semiconductor giant at the heart of the artificial intelligence revolution, is one step away from entering the $1 trillion club. dollars. And yet it is not what we call a “household name”.
Its history is extremely interesting and its course impressive. And as ambitious as its founders were, they would hardly have predicted it back in 1993, when the idea for its creation was born over a casual meal at Denny’s, a classic diner in San Jose, California. There Jesseng Huang, wearing a black leather jacket, one of which he is still seen in public appearances today, invited two engineer friends to discuss how they could improve the quality of computer graphics.
The Taiwanese-born Huang had worked for years at companies such as LSI Logic and AMD. He wanted to share his concerns with Chris Malahotsky, an engineer at Sun Microsystems, and Curtis Priem, a graphics chip designer formerly at Sun Microsystems and IBM. The three agreed on their vision, shook hands with the diner, and a few days later began work.
At the time, the three co-founders believed that the right direction was to follow the wave of accelerated computing, which was based on graphics, because it could solve problems that general-purpose computing did not face.
The lure of video games
They noticed that video games were one of the areas with one of the biggest challenges but also the best sales prospects. It’s a combination you don’t come across often and one that certainly tempts those willing to commit to a professional project.
Video games became the “vehicle” with which the company (which did not yet have a formal corporate structure or even a name) reached major markets around the world and secured the necessary revenue to finance a highly ambitious R&D program aimed at developing innovative solutions.
The first funding and the name
The big milestone was the $20 million funding they secured from a group of investors led by Sequoia Capital. The co-founders had to fill out a series of documents and the name of the company was absolutely necessary. They chose NV – from the initials of the words next version (next version), to mark the new phase in which their project is moving.
But they didn’t want to stop there. They started looking for words from these two letters. At some point they came across the Latin word invidia (envy). They knew they wanted to have a company that others envied. That would be Nvidia headquartered in Sunnyvale, California.
From IPO to GeForce 256 and the grand opening
On January 22, 1999, Nvidia went public. For several years its goal was to establish itself as a leading force in graphics microprocessors that gave video games greater sharpness and less instability. In late 1999 Nvidia introduced the GeForce 256 (NV10) graphics card to the market. It was the first card with a true 3D GPU. For the first time the T&L (Transform and Lighting) technique was implemented at the hardware level.
Over the next few years the company would continue to grow by acquiring smaller semiconductor and graphics design companies, to the extent that it even came under the microscope of the Competition Commission. But nothing stopped her steady course.
The decisive leap of 2006
The name GeForce was chosen through a competition, in which 12,000 proposals were submitted – in an indication of the enthusiasm for the new technology. The GeForce running at 120 MHz was clearly superior to its competitors. Its advantages, however, became apparent only in devices that supported T&L hardware and were particularly expensive. So it was not an obvious success. But it was a step that showed Nvidia’s capabilities.
Nvidia processors, developers quickly realized, excelled at the complex calculations that underpin modern artificial intelligence (AI) systems. They had the ability to actually do many calculations at once, something that traditional computing machines – central processing units – are less suited to.
As tech giants like Google, Microsoft, Amazon and Facebook rush to build AI capabilities similar to ChatGPT, they need expensive chips.
Today in the AI frenzy
It should be said that the company’s first major success outside of video games was in cryptocurrency mining, where GPUs proved to be highly effective. Thanks to this success as well, Nvidia surpassed Intel in market value already in 2020 and continued in 2021 to set new records in its capitalization. But when cryptocurrencies took a dive in 2022, it took a big hit in its stock. The pressure didn’t last long. The generative AI frenzy has investors turning to Nvidia again.
Since the beginning of the year, the stock is up 160%. Last Thursday alone, the company saw its market capitalization increase by $183.8 billion. This is the third largest increase in stock market value in one session. More impressive were only the increase in the market capitalization of Amazon by $191.3 billion on February 4, 2022 and Apple by $190.9 billion on November 10, 2022. Even after this impressive performance, he remains an unknown name to many. That matters little to Huang, who sees his processors in everything from PCs and cars to robots.
