Ep18. Jensen Recap - Competitive Moat, X.AI, Smart Assistant | BG2 w/ Bill Gurley & Brad Gerstner

**Bill Gurley** (0:00)
You may also be running up against the, even for the Mag-7, the size of Capo X deployment, where their CFOs start to talk it out. Yes, for sure.

**Brad Gerstner** (0:11)
Totally. Sunny, Bill, great to see you guys.

**Bill Gurley** (0:26)
Good to see you.

**Sunny Madra** (0:28)
Good to be back.

**Brad Gerstner** (0:29)
Thanks, man, it's great to have you. We literally just finished two days of the Altimeter Annual Meetings. I mean, we had hundreds of investors, CEOs, founders, and the theme was scaling intelligence to AGI. We had Nikesh talking about enterprise AI. We had Renee Haas talking about AI at the edge. We had Noam Brown talking about the strawberry, No-One Model and inference time reasoning. We had Sunny talking about, you know, accelerating inference. And of course, we kicked off with Jensen talking about the future of compute. You know, I did the Dense and talk with my partner Clark Tang, who covers the compute layer in the public side. We recorded it on Friday. We'll be releasing it as part of this pod. And man, was it dense. I mean, he was, you know, he was on fire. He told me, I asked him at the beginning of the pod, what do you want to do? He said, grip it and rip it. And we did. 90 minutes, we went deep. I shared it with you guys. We've all listened to it. I learned so much playing it back that I just thought it made sense for us to unpack it, right?
To really analyze it, see what we agree with, what we may disagree with, things we want to further explore. Sunny, any high level reactions to it?

**Sunny Madra** (1:44)
Yeah, you know, it's the first time I've really seen him in a format where you got all that information out in one setting, because you kind of get the tidbits. And the ones that really struck with me was when he said, Nvidia is not a GPU company, they're an accelerated compute company. I think the next one, you know, which you'll touch on is where he really said, the data center is a unit of compute. I thought that was massive. And you know, sort of just closing out when he talked about, he thinks about using and already utilizing so much AI within Nvidia and how that's a super power for them to accelerate over everyone they're competing with. I thought those were kind of really awesome points and him, you know, eating the dog food, as they say.

**Brad Gerstner** (2:29)
It is incredible. You know, there's this thing we'll talk about later. But he said he thinks they can 3x, you know, the top line of the business while only adding 25% more humans because they can have 100,000 autonomous agents doing things like building the software, doing the security, and that he becomes really a prompt agent, not only for his human direct reports, but also for these agents, which, you know, really is mind boggling. Bill, anything stand out for you?

**Bill Gurley** (3:00)
Well, one, I mean, you should be pleased that you were able to get his time. You know, this is at points in time, the largest market cap company in the world, if not one, two. And so it was so, I think, kind of him to sit down with you for so long. And during the pod, he kept saying, I can stay as long as you want. I was like, doesn't he have something to be doing? Like.

**Brad Gerstner** (3:25)
It was incredibly generous.

**Bill Gurley** (3:28)
And it's fantastic. But my other big, my, I mean, I had two big takeaways. One, I mean, it's obvious that this guy's, you know, rolling on all cylinders here, right? Like you have a company at a 3.3 trillion market cap that's still growing over 100 percent a year. And the margins are insane. I mean, 65 percent operating margins. There's only like five companies in the S&P 500 at that level. And they certainly aren't growing at this pace. And when you bring up that point about getting more done on the increment with fewer employees, where's this going to go?
Like 80 percent operating margin? I mean, that would be unprecedented. There's a lot of that's already here that's unprecedented. But obviously, Wall Street is fully aware of the unbelievable performance of this company. And the multiples reflected and the market cap reflects it. But it's super powerful how they're executing. And you can see the confidence in every answer that it gives.

**Brad Gerstner** (4:32)
We spent about a third of the pod on Nvidia's Competitive Mode, really trying to break it down, really trying to understand this idea of systems level advantages, the combinatorial advantages that he has in the business. Because I think when I talk to people around the investment community, despite how well it's covered, Bill, right, there's still this idea that it's just a GPU and that somebody's going to build a better chip. They're going to come along and displace the business.