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Embracing Failure: Lessons from NVIDIA’s Jensen Huang
- Startup Bell
- Dec 13, 2024
- 9 min read
Updated: May 6
When you think of success in the tech world, names like Steve Jobs, Elon Musk, and Jeff Bezos often steal the spotlight. But one name that’s rapidly climbing into that hall of fame is Jensen Huang, the co-founder and CEO of NVIDIA. Once known mostly for gaming graphics cards, NVIDIA now powers AI models, autonomous vehicles, and the most cutting-edge supercomputers on Earth.
But Huang’s formula for success isn’t just built on big bets or billion-dollar revenues. At its core is something far more human—and far more uncomfortable: failure.
"If you want to be successful, I would encourage you to grow a tolerance for failure. But the thing about failure is this. If you fail often, you actually might become a failure."
This insight from Huang is a masterclass in nuance. He’s not telling you to romanticize failure. He’s telling you to learn how to fail smart—and more importantly, how to fail fast.
Let’s unpack that philosophy, explore why it's key to innovation, and see the failures Huang had to face to make what NVIDIA is today.
The Man Behind the Leather Jacket
Before diving into Huang's relationship with failure, let's understand the man himself. Born in Taiwan and raised in Thailand before moving to the United States as a child, Huang's journey wasn't paved with silver spoons or elite connections. As the son of immigrants who sent him to a boarding school in Kentucky (which he initially thought was a reform school), Huang learned resilience early.
In 1993, at just 30 years old, Huang co-founded NVIDIA with Chris Malachowsky and Curtis Priem. At the time, the idea of dedicating a company to building specialized graphics processing units (GPUs) seemed risky at best and foolhardy at worst. The computing world was dominated by CPUs, and few could envision the revolutionary impact GPUs would eventually have beyond gaming.
The Paradox of Failure
What sets Huang apart isn't that he experiences fewer failures than others – it's his approach to failure that makes all the difference. At Stanford University, Huang shared his philosophy:
"If you fail often, you actually might become a failure. And so the question is, how do you teach someone how to fail, but fail quickly, and to change courses as soon as you know it's a dead end?"
This is the difference between useful failure and destructive failure. Useful failure gives you data. Destructive failure just wastes time and energy. The difference? Intellectual honesty.
Intellectual Honesty: The Hidden Superpower of Great Leaders
At NVIDIA, Huang and his team practice what he calls "intellectual honesty." That means looking at projects, strategies, or decisions and asking, "Is this still the right path?" If not, they pivot—immediately.
"We assess on a continuous basis whether something makes sense or not. And if it's the wrong decision, let's change our mind."
This willingness to change your mind isn’t weakness—it’s one of the greatest strengths in leadership. Huang sees CEOs who refuse to change their minds as dangerous.
"A lot of people say CEOs are always right, and they never change their mind. That doesn't make any sense at all to me."
He’s not alone. Jeff Bezos famously said:
"People who are right a lot, change their minds a lot."
In fast-moving industries, clinging to a bad idea is worse than having no idea at all. Watch Jensen Huang:
Failure Time: Turning Major Setbacks into Strategy
Huang’s career is studded with high-stakes gambles that didn’t always pay off. Each misstep became a case study, and the lessons reshaped NVIDIA’s strategy:
First Brush With Failure (1990s)
One of Huang's earliest and most formative failures came with NVIDIA's first product, the NV1 chip. Launched in 1995, the NV1 was unique in that it was designed to render graphics using quadrilateral primitives (quads) instead of the more common triangles. This was a bet by NVIDIA that this approach would offer advantages.
However, when Microsoft rolled out DirectX 1.0 later in 1995, its Direct3D API supported only triangle primitives. This fundamental mismatch with the industry standard made the NV1 difficult for developers to work with and ultimately led to its commercial failure; NV1 adoption collapsed and the product “failed to gain traction” almost immediately.
According to reports, NVIDIA sold only around 250,000 NV1 chips to Diamond Multimedia, a graphics card manufacturer, and a staggering 249,000 of them were returned. This setback put the young company in a precarious financial situation early on.
With burn rates far outpacing revenue, NVIDIA faced a critical cash crunch—roughly six months of runway remained. In a dramatic lifeline, Sega president Shoichiro Irimajiri secured a $5 million investment, extending NVIDIA’s life and giving Huang the resources to pivot.
By 1996, Jensen Huang made the wrenching decision to lay off over 60% of the staff, shrinking the company from about 100 to fewer than 40 employees, and refocused the lean team on a new, triangle‑primitive‑based GPU codenamed RIVA 128.
When RIVA 128 shipped in August 1997, NVIDIA’s bank balance had dwindled to just one month’s payroll, giving rise to an internal mantra:
“Our company is thirty days from going out of business.”
Yet the gamble paid off—RIVA 128 sold over one million units in its first four months, generating the revenue needed to fund future R&D and cement NVIDIA’s place as a graphics powerhouse.
This saga—NV1’s premature launch, Microsoft’s Direct3D pivot, Sega’s infusion, mass layoffs, and RIVA 128’s triumphant debut—is the true “near‑death” story Huang shares, and it taught him (and his company) the art of failing fast, pivoting swiftly, and never taking success for granted.
Dot-Com Bust (Early 2000s)
Riding the internet boom, NVIDIA’s revenue was skyrocketing – until the bubble burst. Sales plummeted and the stock crashed. Huang reacted quickly: he slashed costs, restructured operations, and doubled down on core GPU technology.
Instead of panicking, he insisted on innovation. The team poured resources into research and development. The result? When demand revived, NVIDIA was stronger than ever. Today’s dominant GPUs (and CUDA parallel computing) were born from that refocused effort. Huang’s bold moves saved the company and laid the groundwork for future success.
“To this day I use the phrase ‘pain and suffering’ inside our company with great glee,” Huang told the Stanford students. “I mean that in a happy way, because you want to refine the character of your company. You want greatness out of them.”
Mobile Misstep (2010s)
Huang led the company into another ambitious venture – competing in the mobile chip market with its Tegra processors. The goal was to power smartphones and tablets at a time when mobile computing was exploding.
Despite significant investment and some initial wins (like powering the Microsoft Surface and some Android devices), NVIDIA's mobile chip business ultimately failed to gain sufficient traction against established players like Qualcomm. By 2015, it was clear that the mobile strategy wasn't working, with the division losing hundreds of millions of dollars.
Again, Huang demonstrated his philosophy of "failing quickly but inexpensively" (though this particular failure wasn't exactly inexpensive). Rather than continuing to pour resources into a losing battle, he made the difficult decision to pivot away from the consumer mobile market.
"We learned the hard way that having good technology isn't enough," Huang reflected. "In mobile, the ecosystem and relationships with carriers were just as important, and we were outmatched on that front."
Cryptocurrency Crash (2018)
During the crypto mining boom, NVIDIA’s GPUs were in record demand, as miners snapped them up. But when crypto prices tumbled in 2018, NVIDIA was left with flooded inventories and plunging revenue. Huang didn’t wallow.
He redirected the salesforce to emphasize gaming and datacenter products, and he accelerated development of chips for AI and high-performance computing. Diversifying paid off: by focusing on emerging AI markets, NVIDIA absorbed the crypto shock and returned to growth.
The Rejection of Conventional Thinking
Perhaps Huang's greatest success comes from his willingness to reject conventional wisdom when his instincts and data point in another direction. Consider these instances:
Investing in gaming when it wasn't respected: In the early days, gaming was considered a frivolous market by many serious technology investors. Huang saw it differently and built NVIDIA's initial success by focusing intensely on the gaming market when others dismissed it.
Betting big on AI before it was mainstream: NVIDIA started investing heavily in AI capabilities for its GPUs years before the current AI boom. As Huang puts it, "We invested in AI long before it was cool."
Avoiding the CPU market: While competitors like AMD fought Intel head-on in the CPU space, NVIDIA maintained its focus on GPUs, a decision that seemed limiting at the time but ultimately positioned the company perfectly for the parallel computing revolution.
Lessons for Leaders: Turning Pain into Power
What can entrepreneurs and professionals learn from Huang's saga? His journey offers rich insights for anyone navigating the treacherous waters of business and innovation. Here are powerful takeaways, each illustrated by his example:
1. Create a Culture of Intellectual Honesty
"We assess on a continuous basis whether something makes sense or not. And if it's the wrong decision, let's change our mind," Huang explains.
This requires creating an environment where people feel safe acknowledging when things aren't working. At NVIDIA, this honesty isn't just permitted—it's expected.
2. Lower Your Starting Point, Raise Your Game
Huang advises having low expectations so you don't crumble at the first hurdle. Highfliers often believe they're invincible – until reality hits.
"When you start a company," he once told a group of Stanford students, "assume it's going to be a million times harder than you think."
By expecting the worst-case scenario, you'll be better prepared, and every win feels monumental. When setbacks come (and they will), you bounce back quicker because your ego isn't shattered.
3. Stay Vigilant; Fear Can Be Constructive
Like Huang, wake up a little worried. Use that adrenaline productively. Fear sharpens your focus and prioritizes action. It’s why Huang jokes his heart rate drops under pressure– he’s in his element. The key is to keep yourself in “the zone” of urgency. That state drove NVIDIA to innovate rapidly and avoid complacency.
4. Fail Fast, Learn Faster
Speed matters when it comes to failure. The quicker you recognize and admit a failure, the less costly it becomes both financially and psychologically. As Huang puts it,
"fail quickly, and change courses as soon as you know it's a dead end."
Each week that passes with a team pursuing a doomed strategy compounds the loss – not just financially, but in morale and momentum.
5. Embrace Pivot and Perseverance
When NVIDIA’s strategy faltered, Huang pivoted instead of pushing blindly ahead. This flexibility is vital. Rigid leaders waste resources on lost causes. By contrast, embracing change – even admitting a mistake – often leads to fresh breakthroughs. Each failure highlighted what not to do, so NVIDIA could iterate toward what will work.
6. Build a Culture of Resilience
Huang’s leadership style is humble and people-focused. He made sure failures became learning experiences, not blame games. By empowering his team to experiment (and occasionally fail), he unlocked creativity. That’s a powerful lesson for any leader: failure culture breeds innovation. When your team knows you value lessons over finger-pointing, they’ll take smart risks and solve problems courageously.
7. Focus on Fundamentals During Crisis
In every crisis – the dot-com bust, Fermi glitch or crypto crash – Huang returned to core strengths. Cutting costs in non-essentials, doubling down on R&D, and sharpening product quality were his go-to moves. After a stumble, don’t scatter. Instead, reinforce what you do best. Nike famously said “just do it” – Huang’s unspoken motto could be: just keep building better GPUs.
Throughout his career, Huang has been candid about the high price of winning. He once told The New Yorker that starting NVIDIA was "a million times harder" than he expected, and even joked he wouldn't do it again if given a do-over. Yet he takes pride in each close call. After surviving yet another storm, Huang likes to go home and tell his wife he "saved the company" – even if it's only by a day's work. That wry remark highlights a simple truth: for serial entrepreneurs like Huang, success is never final. The next challenge is always on the horizon, and there's gratification in overcoming it.
Conclusion: Succeeding on the Other Side of Failure
Jensen Huang’s story is a reminder that failure is often the hidden backbone of success. It’s easy to admire NVIDIA’s astonishing present without noticing the cracks that appeared on the journey. Yet Huang insists those cracks were deliberate stress tests on his leadership.
“When you experience nearly going out of business a few times, that feeling sticks with you,” he said.
It made him paranoid – and into one of Silicon Valley’s most remarkable comeback artists.
For entrepreneurs, creatives, and students alike, the lesson is empowering: embrace the struggle. Next time a project falters or a goal slips out of reach, remember Huang’s mantra. He wishes us real challenges, because each stumble builds character and wisdom. As he tells the next generation, if you “hope suffering happens to you,” you’re preparing for greatness. This isn’t sadism, but a radical reframing: pain isn’t a punishment, it’s training for growth.
Today, NVIDIA stands at the pinnacle of the AI boom, yet its leader is more humble than ever. He’s ridden waves of adversity and used each as a launchpad. That is the ultimate lesson: vulnerability and success are not opposites. On the contrary, your greatest failures may seed your biggest breakthroughs. Jensen Huang’s journey proves it. Now, it’s your turn to take that leap of faith in the face of fear – to learn, adapt, and maybe even say, “I hope suffering happens to me,” knowing it could lead to your moment of greatness.
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