How Matt Murphy Made Marvell Essential to AI and Cloud

28:56Right. Which I referred to and you kind of brought back with the Cisco story. And now we're in an AI CapEx boom right now. And at some point there'll be a digestion and there'll be some moderation like like just you would normally expect. In fact, I think a couple of things, though, that's really exciting about this one. One is, you know, and kind of akin to the innovation that Cisco drove, it really enabled the Internet to exist. Right. And they drove it. And now you have companies like NVIDIA and others and the cloud companies creating their own solutions to let AI exist. the the the interesting one is that on the on the ai side i mean there is and you pick your number you guys have number in your firm and others but there's i don't know four or five trillion dollars of productivity out there right that ai could really go after in the world it really could create a massive for those that win in it it could create massive massive economic opportunity And that's fundamentally what this coupling of all these technologies together is enabling.

30:07From a semiconductor point of view, it's so complex now because what's happened, and this is like a profound shift that I think people are just starting to figure out. You know, for the last 20 plus years, what drove Moore's Law was consumer electronics. You know, in the 90s and early 2000s, it drove Intel's roadmap in terms of personal computing, right? That's what drove Moore's Law, bleeding edge process technology. With the advent of smartphones and sort of that whole and just higher end feature phones and TSMC's rise, their leading edge technology was all mobile focused. If you look now at TSMC, the majority of their revenue is now coming from what they call HPC, high-performance computing, which is this stuff, data infrastructure.

31:03And so now the bleeding edge process nodes and packaging, it's all driven by AI. And look, I've been doing this a long time, and we're in this business, and we are at the bleeding edge. And this is not for the faint of heart. the the the moat that's created around the companies that have uh the right team the right ip the right skill set the right scale to invest in this technology and drive the breakthroughs there's no best practice to follow right now that's right and the funny thing is you're just innovating and so don't even care actually who ends up like cisco didn't care if myspace or Facebook was going to become the social network player.

31:45Cisco didn't care if Napster or Spotify was going to win. Right. Cisco didn't care if Airbnb existed. You know what I mean? Like, or something else. Right. Or if it was Google or the 19 search engines before. Right. At some point, like you're abstracted from the winners and losers. Totally. As long as this is as big as we all think it is. That's right. That's right. That's the question. Absolutely. We are very agnostic to those types of things you mentioned. We supply our fundamental technology in some different forms, right? Whether it's sort of merchant products that we develop, or we do a lot of custom silicon products.

32:34That all is fundamentally leveraged to the whole market opportunity. Whatever model wants to run, whatever killer app wants to run, whatever the new thing in the future on the App Store that's going to be the number one app that's using generative AI and the latest models to go make something magical happen. Our view is that'll all, at some point, all those little hops that go through the data center and all the process, that'll run on Marvell technology. Or a competitor. Yeah, we'll be part of those ecosystems. I mean, it'll all go through. Because right now it's Marvell and all of your competitors and there's still not enough chips.

33:10There's still not enough chips. Right. That's right. And you've mentioned TSMC a couple of times. Can you define TSMC's role in all of this? Especially because like in the previous administration, there was the CHIPS Act. In the current administration, like you all are in a very interesting geopolitical hotspot too. And maybe can you talk about like, what do, how do you work with TSMC? Why is that so important to the work that you do? And then why does that matter to generally like us as a country? I had this belief that the U.S. semiconductor industry was critical for U.S. and I'd say Western nations at large, national and economic security.

34:03and also what has driven significant growth in economies, which has created economic opportunity for everybody, is countries that adopted and invested in leading-edge technology. And you saw this, by the way, in Southeast Asia, which I'll come back to TSMC. Look at the rise of Korea, but it's on the back of semiconductor technology and consumer electronics and advanced manufacturing. The rise of Taiwan, same thing. They concluded Singapore as countries that investing in these types of advanced technologies was going to drive their economy and uplift their citizens and so forth. And the U.S. obviously has been the gold standard in this.

34:45And by the way, the leading market share in semiconductors for the last 60 years. And it did become a very critical issue, which really started, I think, the recognition at the national level right at the end of the Obama administration, the second term. And then I've been on the board as an alternate and then a board member of the U.S. Semiconductor Industry Association since 2011. I'm actually, I think, the longest serving current member now. If you can believe that. A lot of guys have come and gone and retired. For better or worse.

35:51And just to kind of benchmark it, in 2016, when I became CEO, the world was wide open for business. Yep. We had a huge team at Marvell in China, big R &D team, big Salesforce. I was going there once a quarter. The world was open. Free trade was everywhere. And you fast forward a couple years, and all of a sudden, tension. Yep. Right? And the rivalry emerged. Yep. Two different sort of points of view on how U.S. and China were going to go forward. and they were no longer completely compatible. And that started creating tension in the system around between the U.S. and China, what are the trade practices?

36:33Are they fair or not? Misappropriation of IP. All these concerns that have now become in the public spotlight. These are things we were worried about as a semiconductor industry long before 2016, 2017. And not in a protectionist way. I mean, this is like historically been like a free trader, global markets drive growth. Every time a big market opens up for semiconductors, everybody wins. But it was to the point where a lot of a lot of things were happening that just looked very anti-competitive. And so the government got involved. And part of the reason I bring all this up is and I had a front row to this.

37:11I was the chairman of the U.S. SIA in 2018. What's SIA? So that's the Semiconductor Industry Association. And it's a pretty cool story. It was formed in the 1980s by Robert Noyce, who was founder of Intel, Jerry Sanders from AMD, a bunch of industry legends and icons that were very competitive with each other, big rivalries. And in the 1980s, if you study it, there was a similar set of issues between the U.S. and Japan in terms of semiconductor technology and misappropriation of IP and patent violations and ultimately accusations of dumping, which means a company would come and sell something below product cost in a region to gain share and cripple the competitor and using non-market things like subsidies and so forth.

38:09And it got so serious in the U.S. that actually Ronald Reagan got involved. And there was tariffs put on Japanese automobiles. And there's a whole kind of defensive strategy that formed. And the U.S.S.IA was the one that sort of blew the whistle and said, if we don't do something, this anti-competitive behavior is going to put us out of business. And we can't afford that from a national security standpoint. Our military is still a big consumer back then of semiconductor technology. So government got involved, and I'll bring it back to why it's important today. And so the industry came together and formed this organization called the Semiconductor Industry Association.

38:50So it's been around since the 1980s, and it's comprised of CEOs of the largest companies. And you've always got a full board and really amazing people. And we all sort of put down our differences, and we're looking out for the industry. And they rotate the chair position. So I got to I got to do that. And my turn was up, you know, in 2018. And it was right at the peak of peak Huawei and peak peak tweets, tweet fest, you know, between the governments. And it was really interesting to watch. But again, we found ourselves in a similar position, you know, potentially anti-competitive behavior. How do we get on a level playing field?

39:30And then what's your so what's your defensive strategy? And then what's your offensive strategy? And so, you know, you got to do both, right? You can't just sort of complain. You've got to also advance your own agenda. And the CHIPS Act was part of that, right? So the idea was – so that was actually conceived during the first administration. The concept was very well understood, which was we're going to need a way to incentivize companies to – if they've got a decision to make about where to put factory capacity and so forth, you know, put it in the U.S. And then what would that take? It didn't get enacted and passed, you know, passed by Congress until until the Biden administration.

40:12But they really built on the work of the first term. And by the way, I suspect if it gets it's going to probably get renamed and maybe recast a little bit. But I think even in the current administration, I think there's a very much an understanding that this is still really important, which is an incentive structure to make sure that we are less dependent on foreign manufacturing. And in particular, the hot point going back to Taiwan is that Taiwan being in the less dependent on TSMC in Taiwan. Exactly. Why? Well, because why is TSMC so important? So they are the undisputed leader at the moment in driving Moore's Law and process technology leadership.

40:58Define Moore's Law. Okay. So Moore's Law was a concept that was coined by the co-founder, Robert Noyce's co-founder of Intel, named Gordon Moore, who posited concepts around by driving improvements in process technology, wafer process technology, and improving the transistor density of those processes, which would enable more computing power on every successive generation. more power at a lower cost, if you will, because you get more density, more diana wafer, that you could basically have sort of a doubling effect every few years in terms of your power performance and area. And that's continued today.

41:48Now it's slowed. Yeah. But just to bring it to a point, so TSMC took the lead over Intel in this maybe, I don't know, like seven or eight years ago, something like that. And Intel has not been able to catch up. And what's happened with these AI applications is even though the technology is very expensive and you're not getting the kind of cost per transistor improvement anymore, the power per millimeter square is still improving. like 20, 30 % per generation. So think about that. So maybe you're not making a chip any cheaper when you go from one process node to the other, but if you can save 20, 30 % power consumption and that's direct OPEX for a data center provider, there's a rule of thumb that says basically every watt you can save of power is about a dollar of OPEX.

42:44So think about that. It's worth something. You might not be able to benefit by getting like a lower cost solution anymore. It's probably going to get more expensive, actually, these chips. But the power savings is so compelling, the economics pencil out. So you need the most bleeding edge. And that's where TSMC outperforms. Correct me if I'm wrong, but didn't a lot of the money from the Chips Act go to Intel? Yeah, they've received... For this exact reason, right? For this exact reason. Because they lost the competitive advantage to TSMC. Yeah, I think, well, there's two things. There's the decision on just where you're going to put your manufacturing capacity.

43:25And so the Chips Act was intended to offset some of the – because other countries do this. I mean, other countries put big incentives up for you to put wafer fabs because of the reason I mentioned. It uplifts the whole economies and it creates technology that's very unique. Like, so that was really just from a pure, like, where are you going to put your capacity? Government's not going to help them catch up. Yep. They need to catch up. Yep. And that's more their team and their execution and what they need to go do. But TSMC, and I've worked with this company for a long time, they're excellent.

44:02And maybe like if I fast forward to more recently today, why are you, why is the stock getting hammered? Like, why are you down 50 % in a few months? It's always fun to speculate on why you're up and why you're down. Yeah, I think, well, I think in general, if you look, I mean, I just give you some empirical data. Yeah. There's all kinds of ins and outs at any given moment on a company's share price. But for like the last five years, if you look at all semiconductor companies, there were three companies that always traded in a very similar PE multiple range that were different than everyone else.

44:43And that was Marvell, AMD, and NVIDIA. And the three of us have historically for like the last five, six years commanded something in the 30 to 35 times range when the average for the overall semiconductor index is maybe 20 or low 20s, which is a little elevated of where it usually was. Usually that index trades at like 17, 18 times. But it's been a bull market. So think like we are, you know, on every dollar earnings, you're getting quite a bit of an uplift, right, when your P.E. is higher. And that's because all three companies have grown really nicely and so forth. When we announced our December quarter, our PE and like the data point you gave, it probably went to like 45 times.

45:30When you got to$100 billion. Yeah, something like that. Yep. And now with all the global economic concerns, there's been an AI tradeoff that's happened. The tariffs. You know, tariffs, you name it. Multiples have come down. Yeah. So now what was normally 30, 35, shot to 45 is like 18. And by the way, that's kind of where those other companies, they're trading at too. NVIDIA and AMD. Yeah. Yep. And then, and again, that's not the whole story, but that's just some simple math to like, okay, well, if you take 45 and you cut that like over half, then what happens to your stock price if the E doesn't change?

46:11Yep. Now, the reality is, I think Mr. Market is also saying, and this is a broad statement for semiconductor companies, hey, there's a lot of risk of recession and what's going to happen in the global economy. So probably Mr. Market's got the E part of it lower in the future. It doesn't quite match the sell side numbers. That's some of what's going on. And, you know, our view is we've got to just execute. We got to deliver on the revenue we committed. We got to meet these critical programs for our customers. And we got to make sure we stay three steps ahead so that we stay well positioned for this, I think, at least kind of 10 year cycle we're on relative to the AI spend and where the technology is going.

46:58And we're just going to power through it. Good year, bad year, we've increased our R &D every year since I've been CEO. I was reading an article that was saying that according to retail investors, Marvell has the second best AI growth story behind NVIDIA. And the headline of the article was that you were being considered for the Intel CEO job, speaking of Intel. And first of all, whether you were or were not, I'm actually not going to opine on that. It's just cool that you and the guy that ended up actually taking that Intel job, who's coming on the show, by the way, which I can't wait. Yeah, he's a good friend.

47:34I'm very happy for him. I think Intel is really blessed to have someone of Lipboo's capability and character. And we need this company. We need this company. Absolutely. It's arguably the most important U.S. manufacturing and technology company we've had. And I think, you know, with with Lipu's leadership and the hardworking folks at Intel and, you know, some degree of grit and determination and hard work. Yeah. Still must be flattering. Just even. Yeah. I mean, this is an institution like this is an American. Oh, my God. Absolutely. I mean, we you know, you talk about people like Robert Noyce, as an example, you know, or Andy Grove, who was always sort of one of my role models.

48:23And I got a chance when I attended the Stanford executive program in 2010. Andy was still alive and came and spoke to us. A group of like 80 people or something. And it was one of the highlights of my life, you know, to be able to. And I got to meet him afterwards and read all the books. And so, yeah, I think it's a legendary company. I think I never thought I would wake up one day and see a Bloomberg article with my name in it associated with Intel. and it's flattering to even have that sort of out there. But the reality is, and I've kind of given you some of this background now on the Marvell story, I mean, it's really a special place to me.

49:07I came in, there was a lot of issues going on. I left a great job I had. I took a lot of risk and I'm just so excited with where we are. And somebody asked me about it, right around when that thing came out on an earnings call. And I just said, look, I'm not commenting on anything, but I'm all in on Marvell. That is what you said. I watched that interview. And didn't Andy go to Andy went into it after? Where did Andy go after Andy Grove? Where did he go? Oh, well, no, he was the number three employee at Intel. Yeah. Okay. He wasn't technically a founder, but he was in the top three guys. He became CEO probably in like 1988, something like that.

49:51And had one of the most incredible runs. Similar deal, by the way. It was a$3,$4,$5 billion market cap. I think when he left, it was$150 or something. He was time man of the year. He retired from Intel. He had cancer. He fought it. He remained like an emeritus kind of role. And then, but he didn't go. He just stayed as an advisor to the company and had a bunch of philanthropy. And then he passed away a few years ago. I should know this. We have a long history with Andy at Kleiner Perkins. And actually, like the origins of Kleiner Perkins are because of the semiconductor industry. Exactly. And so we, you know, like.

50:32Yeah, you could have some great stories with Lip Boo, especially if he wants as he's gotten entrenched in the Intel culture and company. Yeah, we forget. Like sharing some of that. This place is called Silicon Valley. Exactly. We forget. I know. That was the. Again, we talk about like the foundational. What's foundational in the economy? what drives growth, what's foundational in technology. It's the Silicon Valley. I mean, it's such an amazing place to have worked for the last 30 years, but I think I take a lot of pride and I'm so lucky to be in this industry. I think it's really a kind of a golden era for semis.

51:11Who would have thought? Who would have thought? Because we've had some bad years too. too. I'm curious. You said that it was like there was some risk when you joined Marvell. I agree with you. Can you quantify what that risk was? Like, what was the state of like, we know the market, we know the share price was low. But yeah, what had happened was, you know, Marvell was founded in 1995. Actually, it's our 30 year anniversary this year. Congratulations. And by the way, our little theme of the whole 30 year anniversary we came up with was all in. There you go. You know, like, let's go. There you go.

51:46Let's go. And, but what happened, but so Marvell was found in 1995. Always had a very strong reputation as a really, really capable engineering company. Products were good, you know, very innovative culture. But they ran into some trouble. And in 2015, there was a whistleblower complaint about by somebody in the finance team that there was, you know, revenue ship-aheads happening. And that was kind of declared in front of the company auditor at the time, which was Price Waterhouse. And basically, a whole saga ensued after that. And I won't go through all the details in the exact chronology, but basically, the CFO left, the auditor resigned.

52:36At some point, The board fired, you know, the two founders, which was a husband and wife, Sahat and Wei Li. They remained on the board. An activist investor came in, which was Starboard Value. They bought a chunk of the company. They said, basically, you know, deal with us or we're going to run a proxy contest. The company settled with Starboard to add new directors. and then in that whole process, and it wasn't clear at that point, I was watching this from the outside going, what's going on with this company? And then I got a call to interview to be the CEO, and I thought, I'm not sure I want to touch this.

53:24But something intrigued me, and I talked to the guy who was the chairman at the time who just retired a few years ago, Rick Hill, who had been chairman and CEO of Novella Systems, very successful guy, really well known in the Valley. And we had a lot of shared kind of commonality with people we both knew. And he saw a lot of potential in me. And he sort of assured me, look, this thing's going to be fine. I mean, there's a lot of things that need to get improved here. my current lead director, a guy named Mike Strachan, who took over. So I became chairman after Rick left a few years ago. And then Mike Strachan became my lead director.

54:07But I remember interviewing with him and he was a former senior partner at a big audit firm. And I said, Hey, how, how, how bad is it? You know, cause he was in, he was on the board at that time. And he said, I'm not, I'm not sure I've ever seen so any more hair on anything than this one, but it's fixable. And actually I even talked to Deloitte who had taken over as the new auditor. And I happen to know the audit partner because she was the partner that ran, was our audit partner at the company I had been at. And she and the senior Deloitte people said, look, we've looked at everything. Everything's fine.

54:42So there was bad behavior. They shipped revenue they shouldn't have. It inflated revenues in the short term. It's a problem. There was a shareholder lawsuit we had to go clean up over that. But basically, the company's okay. It needs leadership. It needs leadership. And I looked at it and I thought, okay, there's a potential here. And I kind of was thinking at that time what I told you earlier. I think I could take – it's big enough in terms of the scale. There's enough sort of operating cash flow once I clean it up. And I could probably use this as a platform to reshape what I thought. And I did it.

55:22Yep. Played out. But it wasn't clear. And everybody was terrified. Can you imagine? We had no financials on file for like three quarters. We had a delisting notice from NASDAQ and I had no CFO. That's crazy. And I just showed up. And your dad was a CEO? Yeah. Yeah. My dad was, he had been a longtime tech executive. He had worked at Apple in their heyday when Steve was there. And then he became the CEO of a company. And then he became the CEO of a, yeah. At one point, he was a head of Apple USA in kind of the end of his career. And then he left and he became CEO of a modem company. and at that point when you were growing up then like you always aspired to be kind of like a business person like your dad like you did you have the ceo checkbox in your mind maybe in the back of it i think i never um it's fair by the way to have that yeah but no i i i i think i never thought i would be capable of it necessarily um but i always i i admired my father and he was a huge influence on me.

56:36In particular, I think we grew the closest actually after I started working because I would, he was so experienced, you know? And so I would like, I'd like, well, first of all, I lived at home for the first year I was working. They, my parents were living in Woodside at the time and they had a space for me to like stay above the garage. And that's like, hey, save some money, you know, before, before you rent your own place. So I see him every night and talk to him every day. And I'd say for, he got very sick, you know, later and he got Parkinson's in like 2010 timeframe, maybe a little bit earlier.

57:18But there was a period of time where I talked to him almost every day. And it was kind of interesting as somebody who had no experience. And all of a sudden I started like managing people and I kind of became like a director level person. And it's almost like along the way, there was a new layer to unfold. He didn't expose me to everything he knew, you know what I mean? So as I progressed until I became a CEO, he really helped me. And he helped me in a lot of ways with my impatience and understanding that when you're young and you're ambitious and your career is going like this, A lot of times it takes a while for the management to figure out like actually how good a job you're doing and the steeper your rate of sort of progress.

58:04The more flat footed you catch management. It takes them longer. Yeah. And he says you should be – it's like an honor if you're the lowest paid guy, you know, in any given position you have because that means you got there early. And you'll eventually catch – they'll catch up. You know, don't worry. It couldn't have been more right. That's a really good lesson. But I try to tell that to people that have worked for me because I was that guy. I can't believe I didn't get promoted. I can't believe I didn't get this or that. You know, and he great, great lessons in leadership, great lessons in management, great lessons in patience and perspective and how to how to how to conduct yourself.

58:43It really helped me. It really helped me to have a mentor like that. Was he around when you became the CEO of Marvell? Yeah, he was. He passed away in 2019, and he was in pretty significant decline when I became CEO in 2016. But he, it was actually a very cool, very cool story. He was, he was still with it enough so I could, you know, have a conversation with him. It was a little slow and stilted, but it was more, I think his cognitive function was still pretty good, but it was just hard to communicate. and so I got the I started like in July and I think within a few weeks I said hey can you can I'd love to show you the place you know and uh so he had a great we had a great sort of um uh couple of people that were helpers for him you know to get around and a lot of mobility issues so So he came over to Marvell on a Saturday, and I met him and William.

59:48And have you seen Marvell? Have you seen the building or the facility? I've never been. Yeah. You should come by and see it and grab a lunch. I'd love to. It's actually super impressive. So if you remember a company called 3Com, 3Com had built a huge, beautiful facility right off 237 in Great America. and kind of the networking boom. And, you know, basically Marvell bought it in 2005. We own this facility. It's like a million square feet. It's an acres and acres campus. And it's just physically a huge building. Like when people know it, they're like, oh my God, that's like a huge company. It almost like helps you punch above your weight in a way.

1:00:25Totally. And so he came over and he was just like, you're the CEO of this place? you know, and then I took him around and showed him a whole tour of the facility. And it's huge, but I took him through my building, showed him the boardroom, my office. And we were standing there kind of looking at it. It's right on 237. So you look out over the bay and we were standing in the boardroom. I remember just him and I. And, you know, he was like tearing up. And he's like, I just can't, I can't believe what you've accomplished. I'm so proud of you. It's really special. Very cool. Very cool. Very cool. Yeah.

1:01:05So he did get to see it. And, um, yeah, I think, and it was great because all that advice and, um, impact he made on me, it really, it really, it made a difference. Yeah. Yeah. Thanks for sharing that. It was really cool. Yeah. I was sent an email that you sent to the company, subject line grit. Obviously it was catnip for me. And, um, what year was that email sent? When, do you remember when that email was sent? I think within the last two years. Okay. Yeah. I send one every week. You do? Yeah. One of these? Yeah. It's not labeled Grid every time, is it? No, no, no, no. Okay, okay. That one's Grid.

1:01:45Just this one. And they're not all this detailed, but some of them are. I mean, some of them are just, I started this on a regular basis during COVID, actually. Just an update, a kind of brain dump for the company. Yeah. I mean, during the pandemic, I mean, I always found even when I was at my prior company at Marvell, my written communication like via email is high impact. It's not the same as a blog. It's not the same as something on the Slack channel or a little audio recording or I'm doing it. For whatever reason, for me, with the people that have ever worked with me or for me, email from Matt makes an impact.

1:02:27And there's something about just getting an email. Yep. And so they were always well-received when I would send one, but I wasn't always super consistent. And some of that, too, was I was always trying to empower my team and make sure I wasn't trying to hog all the limelight and make sure that the leadership could communicate with. But when we hit the pandemic, I just decided, and I told my staff and Chris Koopmans, who you met, who's been with me from the beginning, hey, I need your help because I'm going to have to communicate, like over communicate. And so the first email I sent was like March 20th, 2020.

1:03:08Yep. Subject, coronavirus. And you've kept going ever since. Kept going ever since. This email, there's a couple of sections that really stood out. The first was that you actually talk about Angela Duckworth's research on grit, which was really the inspiration to this show. I had her on the podcast. It must have been so cool. It was like. No, she nailed it with this work. It's like meeting a hero. Yeah, she nailed it with this work. It all really crystallized for me, this idea when I came to Kleiner, where I realized the best founders that I work with just have this uncanny ability to keep pushing forward and getting back up.

1:03:51I didn't know how to define it at the time. Obviously, I do now. And what you wrote in the email, quoting her, is she found that even beyond a person's natural talent and IQ, grit was the differentiating factor in those who would succeed. More than the school you went to, standardized test scores, or other metrics commonly associated with long-term success. I have a younger brother. He's much younger. He's in high school. And I told him, like, I wasn't, like, one of the cool kids. Maybe he's more of a cool kid than I was. And I reflect back, and I was telling him, like, all those kids, like, doesn't matter, like, all the smart ones that I remember.

1:04:24like all the ones that were the best in school, all the ones that were like really cool. There's like almost zero correlation with where they are in the world today. Almost zero. Right. You know? And this quote reminded me of that. And then you shared your own story where as a college senior, you would train twice a day and ran up to 90 miles a week for your, you were in track, obviously. Yeah, I ran cross country in track. 90 miles a week. Yeah. Yeah. Yeah. That's insane. Yeah. Anyway, I was just like, it was a really cool email to send. Yeah. And maybe it was almost, it felt to me like in a time of trial and tribulation, your expression of, we got to go fight.

1:05:09Like, we got to go do this thing. Exactly. And you really like. And I timed it around that. I can't remember exactly what was happening at that time. I don't know if there was a, I think there was a down quarter right around when I sent it. But like we were coming off the. Similar to the one that you just had now. Well, no, the different. This one I guided up. Right. That one I guided down. And it was to be expected. It was, I think it was a quarter right after, you know, every company went through their reset after the pandemic. You know, semiconductors are volatile. People have built up too much.

1:05:41So we had this sort of guide down. Stock got hit. Everyone was a little bummed out. You know, and I'm sort of like. and I always have a queue of these, like of these like very personal, call them that notes, you know? And so I was saving the grit one. And so I tried to time it with sort of like, hey, we got to power through. You can't just get all mopey dopey because your stock went down and like the world's coming to win. And it's like this whole AI thing was taken off for us. Like I actually felt very good about once we got through that quarter, what it was going to look like. Um, and it's, it's, I think it's helpful to share experiences that it's okay that you have to grind sometimes and you do get beaten down and you have, it's kind of the, it's your defining thing though.

1:06:27Like, do you decide to pack it up and give up or do you just keep going? And, and, and the gritty, the grit thing was really interesting to me because I don't know if I put it in the note, but the other factor that, that Duckworth talks about is being able to do that, you know, go, go basically long periods of sustained sort of effort and, and pain potentially with little to no positive reinforcement. And I think that is something that, um, either I had innately or I developed over time, but definitely has helped me a lot to get through these big ups and downs that you deal with in your professional life.

1:07:10And certainly as an athlete, both, uh, both running in college. And then I ended up doing triathlons and racing. Um, it's kind of invaluable and it has a huge correlation. You know, people that do endurance sports or, or played sports in college or were competitive athletes and their ability to excel and, um, and succeed in the business world. When, when times get bad, do you still run like that? No, not as much. I, I, so I did, I did, I did. So actually when, when my father got sick, which was in 2010, 2011, I was turning 40, I turned 40 in 2012. And I had gone through a period where, you know, I was traveling so much and I had, my kids were younger and it was just, everything was busy and I really let my health kind of go.

1:08:08and I sort of just got religion, you know, it was like, hey, I want to do everything I can to prioritize my health and especially seeing what my dad was going through. Not that he was unhealthy and that caused it, but, you know, it gets your wake up call and how much he was battling with physical therapy as the Parkinson's got worse to try to stop the entropy and stop, you know, it was just really hard to watch. So I'm like, this is something I can still get control of. So I did like, I did like a little sprint triathlon in 2011 in the summer. It was so painful. It was so out of shape. And I signed up for a half Ironman in March of 2012 in Oceanside, California.

1:08:49And I trained for it and it was just hellacious. I mean, it was like, I'd never done a half Ironman something that long at that point. When I was in my twenties and thirties, before I got out of shape, I was doing more like Olympic distance, but got through it, gutted it out, and then did a bunch of races that summer. And by the end of the summer, like I was actually like pretty fit. Like I'd lost a bunch of weight. I was like in really good shape. I started placing pretty high. And I raced the 2012 season, 2013, 2014, 2015. And my last kind of semi-serious race was Escape from Alcatraz in 2016.

1:09:28and I remember that right after the race, I literally had to go to a hotel I had booked and I was signing my Marvell offer letter. It was crazy. It was this final negotiation over what my severance agreement was or something. I mean, that was the timing and I was actually in shape to do an Ironman. So I had the Vineman on the calendar. It's the one up in Napa. Yeah, it's up in Guerneville or something. Anyway, that was end of July and I thought, there's no way I'm doing this. I was in such bad shape over the two Ironmans. I did, I'm like, I can't take the CEO job. And like two weeks later, I'm trying to do some Ironman in a 90 degree weather.

1:10:03And I'm going to be like, I'm like, I can't do it. So then since I've been CEO, I got to tell you, I've had some fits and starts and I've tried my best, but the job really, really makes it difficult. So I think I've done, I did, I did, I did Oceanside in 2023 and I did it in like 2021 or two. So I did two races, but I'm not. Does it work out every day? I try. I try. Does the job get too demanding to find time for that? Well, here's my take on this. So this is where I hold myself accountable. It's an easy excuse to use your job as an excuse. And by the way, the higher you go, the more you get away with it.

1:10:46Well, you're so busy. You're a CEO. I understand that. Everyone's going to give you sympathy on that. I actually have no sympathy for myself. it's a hundred percent well not a hundred because i'm also getting older i'm like 10 years older now than i was when i was doing this before but but it's mostly in my view a discipline issue and a prioritization issue and you know i was super busy when i was doing all this training it wasn't like i didn't have an easy job i was running sales for this company for max when i was there i was svp of a division i was a number two executive battling always been busy Yeah, yeah.

1:11:26I've been a section 16 officer of a public company for 19 years. Right. Okay. So I've always had stuff. Yeah. But I found periods of my life where it was easier to get momentum and get consistent. And I'm still striving to do that. Well, you mentioned prioritization and discipline. I think prioritization comes first and then discipline comes. Meaning applying discipline to a lack of priorities isn't very helpful. But if most important to you is prioritizing your family, then you can have discipline around that. Or if it's your job, then you can have discipline around that. Or if it's your health, you can have discipline around that.

1:12:01I'm doing my first triathlon. I'm doing the Escape from Alcatraz next month. Oh, you are? Cool. First one. Good luck. Have you ever swum in the bay? Have you climatized yourself to that experience? I went into a pool a few months ago. Okay. And I was like, oh, I barely know how to swim. Oh, boy. Like I got goggles gifted to me from my fiance's family because they heard I was going to do it. And this was maybe like my partner's kind of like hint, like you got to get in the pool. I just really didn't want to. And I get in and I'm like, all right, like I get to one end of the pool and I'm like turning back and I'm like, I'm exhausted.

1:12:40Oh boy. The Bay can be, yeah, a different world. I've done a bunch of open water swims. There's a race in LA every year I like to do. which is a Hermosa Beach Pier to Manhattan Beach Pier. It's called the Pier to Pier. I did once in 2013, I swam from Asia to Europe, cross-continental swim on the Bosphorus Strait in Istanbul. What? And how far is that? Seven and a half kilometers. How many miles is that? With the current. Yeah, it's like four miles and change. It's like eight kilometers, like five miles. So just a little bit less than that. Three distances of the escape from Alcatraz. Right. Now it's got a current to it.

1:13:22So if you swim it correctly. Yeah. You know, but yeah, it's like a four plus mile swim. Yeah. They ferry you up and you literally start on the Asia side, get in the water. And then when you finish, you finish on the European side. It's pretty cool. I have a whole. That's incredible. Yeah. Yeah. A whole certificate and all that stuff. It was crazy. I, like a few weeks ago, I went for a long run. And then I was like, all right, I'll just go swim in aquatic park. It's just in my running, in my running shorts. Jumped in, swam for, I don't know, one minute. Yeah. And I was like, no, hurting. I'm so cold.

1:14:01Yeah. I'm like, all right, I'm out of here. Don't do that. And don't swim after your run either. That's really hard. Really hard. Yeah. So anyway. Okay. All right. We'll work on this one. We got work to do. We got work to do. Thank you for doing this. And I'm so excited to see what's next. Yeah. I mean, it's a really interesting time to be doing this, right? There's tremendous opportunity out there, I think, for the types of technologies. I think the long term is really good. There's a lot of uncertainty in the business community right now on the impact of trade and tariffs and things like that and what's it going to do.

1:14:41but you know we we we look at our customers and what they're asking us to do and what their ambitions are and quite frankly we can't go fast enough yep i mean it's a really really amazing time and if i didn't if i just didn't have to look at the equity markets you know i'd be saying we're we're in great shape yep you know and so that'll take care of itself over time i mean And, you know, three months ago, it was where it was. And now it's where it is. And I'm like the same person and the same guy and the same company. So and I love what I do. I think I've got this company to a point where we're really in fighting shape and we're not a technology laggard.

1:15:26We're not trying to go. We're like pioneering stuff. And I'm fascinated, too. I can't wait. And I've got such a capable, incredible team of people at Marvell. I mean, very, very dedicated individuals, no politics, no BS. Are you hiring? Great team works. We are still hiring. We're hiring in very targeted areas. Like where? Well, the key, as it turns out, you know, when you do these, especially these large semiconductor chips, you think a lot about, hey, like how much compute power is on it or like what are the features? But it turns out, and this is something that we're really good at, what ends up defining in a lot of ways the success or failure of your chip is actually what's known as the IO or the interconnect.

1:16:19And so there's a lot of specialization that occurs, a specialized engineering capability that's in what's called the analog and mixed signal domain versus the digital domain, which is basically you have a bunch of electrical signals on one of these digital logic circuits like a big AI processor complex or something. But you've got to get the data on and off the chip at an incredibly high rate. And those interface blocks and circuits are very sensitive. It's a very unique skill set in terms of analog engineers to do it. And the company I was at before was an analog mix signal company. We did these in a lot of kind of traditional process technologies, not the bleeding edge CMOS, but same issue.

1:17:03and how you kind of hook up all these chips together now and how you get all the data in between them and on and off, including between the chips. Think about all the memory now that gets stacked around these high-performance AI processor chips. How do you optimize that throughput? How do you do it in the smallest possible size so you can have more compute? That whole area is like ripe for innovation, and you really need experienced, talented people. And so we continue to – we have a very, very strong team there. We continue to double down in that area. package technology is getting as important kind of as the chip in terms of how you stitch all these together.

1:17:38So there's a few key areas where kind of no matter what, and I think the other one you'd find interesting as we wrap here, but we, I made a commitment actually was my first major decision as CEO. When I, my first day I was doing like my orientation, you know, and I'm like filling out paperwork, you know, like your address and social security, I'll give the HR with an HR person. And I said, Hey, what's, um, what's going on here with the intern program? Like how many interns do we have every year? Do we have a program? And she said, Oh no, we had one once, but budget got cut and no, no funds for it.

1:18:13You know, and I'm thinking this company spending like a billion dollars a year on OpEx on people that we can't afford some interns. Are you serious? Like, you serious? Like the place was leaking oil. There was so much like cost to go fix. And yet we couldn't fund the interns. So I'm thinking to myself, I'm going to have to create the flywheel here because over time, you know, there's this issue in any industry, but especially semiconductors, it's pretty mature industry. So if you're not bringing that infusion of talent, you get older and you age out and people retire and you haven't passed on the knowledge.

1:18:43So we started with humble beginnings. We've now got a program of like 500 interns that They come in every year. Wow. We convert if they're going to be a senior. If they've done a good job, we offer them a job by the end of the summer. I think we convert 70, 80%. We get that except. So they leave Marvell the summer before their senior year. They got a job the next year. And then you add that sort of flywheel we've built, plus just new college hiring. 23 % of my new hires last year were out of school. Bachelor's, master's, or PhDs directly in. It's awesome. It's a huge infusion of young talent. That's incredible.

1:19:27And it's exciting. And it took a long time to build this up. So that one, I'm going to kind of protect at all costs. No matter how bad the year, I never cut that interim program. I always make sure it's world class. Bring in the infusion of new talent we're going to do. And depending on what happens with the overall economy, we can flex. We can decide to hire more or less or control our – we're not a control – semiconductor company leadership teams, they're good at controlling expenses. It takes a little time, but we're sort of accustomed to this. But at the moment, we're really focused kind of on new talent and then some of these key areas where we can really differentiate.

1:20:05But in general, we've staffed up the company in a really healthy way. We're able to execute on our projects, so it feels good. We talked about this briefly, but to wrap, when you hear the word grit, what do you think of? it's a combination of things, right? It's, it's certainly not giving up. That's kind of an obvious one, but it's, it's easy to give up, right. Or lose motivation. It's also about not wallowing in it. You know, take your time, process it. You had a bad race, you know, you had a bad quarter, you had a bad, you know, your chip didn't work. You had some bad thing happened. Look at some point, like you're like a CEO, like me, and I got like bad stuff happening all the time.

1:20:46I'm like, somebody got to pack down, right? But process it first. Like, just acknowledge it. Like, hey, that sucked. That wasn't good. And realize that for every bad day you have, it could be the worst day you're having. Guess what? Probably within the next seven days ahead of you, you're going to have a good day. If you're good at what you do and you're competent and capable and you put in the effort, you're going to be fine. But sometimes it feels like the end of the world. And that's where I see people like lose their confidence or, or, or spin out of control. And that's why it's important to have mentors, right?

1:21:23If you can find people, like I was lucky to have my dad or like good friends of mine. I mean, I remember I did this half Ironman. I was preparing to do my first Ironman. I did, I did the wildflower triathlon, the half, it's really hard. It's kind of like doing a three-quarter Ironman also. It had a horrible race. I blew up on the run, walked a ton of it. I finished. I mean, I was almost in tears and not because I was like, my time was slow. I was like, I don't think I can do this. You know, like I, like, how am I going to do a whole one? And I can't even get through this, this thing. And my good buddy and training partner was there at the finish.

1:22:03He finished way ahead of me and he was waiting for me. And I was just kind of getting emotional. And he's like, look at me. You're a badass. You've put in the time. I've been riding with you. You're smoking me. You're killing it in the pool. Like, bad race. Get over it. I mean, having, you know, people around you at those moments, it sounds, but it's like, he was right. Actually, I got stronger after that race. Yeah, I ate it and it was terrible. But guess what? I was so freaking strong after doing that suffering for six and a half hours or whatever that one took or six. You know, it should have been done an hour earlier.

1:22:45It was one of those horrible. But man, I was so freaking tough after that. And then the next race I did, I felt better. And then by the time I did this first Ironman, which was Ironman Lake Tahoe in 2013, the first year they had it. I was just rearing to go. and in and by the way in that race in the last four miles of the run were my fastest four miles of the whole marathon finished strong it worked out but in my darkest moment i'm like this sucks i hate it and so you know i think this says that recognition that the grit part of me got over it and processed it and owned it and was like okay and then just the final thing is it's always like coming back to remembering like, am I, am I, did I do something wrong to have this bad thing happen to me?

1:23:35Or just, just did it happen? Like, do I need to course correct or not? And I still remember being on that starting line in Lake Tahoe and standing there. And like, it's by the way, it's 27 degrees at race start. It was nuts. Snowed the day before, like the ambient was 27, you know, the water was super cold and I'm standing there in like my wetsuit and I'm looking at this like foggy, you know, like Lake Tahoe by Kings beach. And, but I remember thinking to myself, I don't actually feel any different, you know, physically that I've like maybe, but I know I did the work. I know I put every, you know, I know I, I dialed that, that training in and that actually carried me, you know, every time you're going to get low, it's like, no, no, I've done the fundamentals.

1:24:23I put in the time. And it's just interesting to decouple kind of your rational brain from your emotional brain. And I think grit is the ability to fundamentally do that and then reset yourself and power through. Keep going. Great answer. Don't give up. Thank you. I appreciate it. Yeah, I appreciate it. It was fun. Yeah. Thank you. That's it for now. If you liked the episode, please leave us a review or go back into the archives where we've done more than 200 episodes with some fantastic folks. This podcast is a Kleiner Perkins production, and I'm Juven. Thanks for listening.