In the digital era built on silicon, there stands an inspiring Asian American leader, Lip-Bu Tan, chief executive officer of Intel. What happens when a semiconductor industry leader meets an association celebrating 35 years of connecting the industry? A spark of ideas, a collision of perspectives, and a conversation that could shape the future.
And now, without further ado, it is time for our fireside chat. Please give your warmest welcome to Intel CEO Lip-Bu Tan and CASPA president Jimmy Cheng.
All right. I know you all been waiting for this for a long time. Thank you. It's a mic-weight honor to have this chef eye chat with um chief executive of Intel, Lip-Bu Tan. And so, before we get started, I wanted ask you something that I always want to check with you because it's always intriguing for people like you. Why do you decide to take on a role like this? Because you know, people like you would think you would be in Hawaii or somewhere, at least on a comfortable board. But taking a job that difficult and many people has failed, and you odds is not really on your favor. I I'm sure that people people at home might ask you, "Have you lost your mind?" So, why did you even take this job?
It's a good question. First of all, congratulations to be the next president of CASPA. And then the other part is 35 years a long time. And I'm honored to be on the advisory board, and I see the tremendous growth. And uh you have 1,000, you know, and 10,000 of people, and then this is just an amazing event. And we should say congratulate you and the team for CASPA. 1,000 people in this dinner room, I think we should applaud you.
You know, that's a tough question, and uh 5 years ago, and um I was asked to finalists to be the CEO. My wife said no. So, I you know, for 45 years, I always listen to my wife. And he told me, "No." And so, this time, you know, the some of my good friend, uh some of them are very good friend, they basically advised me, "Don't take this job." And people only remember the last one. And then if the last one not successful, you're going to be failure for the rest of the life. Even though I don't agree with that. But anyway, it's caught my attention. And uh But I have a very good friend in Seattle. I he sent me a very nice note. "Lip Bu with all your success at Cadence, you have close to 160 IPO, uh you have 126 M&A successful, you don't need this. But Intel is a iconic company. It's so important for the industry, and so important for United States. Before you retire, save Intel." And that is exact word he put down. I still frame it, and something that's very dear to me. And uh I was very touched. And one of my friend, very close friend of mine, from Boston, he flew all the way here and he's close to my wife. He told my wife, "Don't let him do this."
But, long story, I think I got very, you know, emotionally attached to company. And I have close to 150 executive from Intel that I'm good friend of, like Albert Yu, Sha Maloney, and a few others, Daddy Permuda. They all asked me, "Lipu, you should save the company." And so, it's very tough to see so many friends. And to be candid with you, when I finished my school, I was investing in semiconductor. Intel is a role model in terms of paranoid survive, you know, gross margin, operating margin, cash flow, uh very decisive with the three founders. I admire them. And so, something that, you know, at the end, I do ask my wife for support and my son's support. Uh my wife told me, "You know what? You're already emotionally so attached to it, and you might as well do it. I will support you." That one word, it mean a lot to me, so I decided to do it. So, I think all in all, I think it's a iconic company. It's so important. Uh I just survived 18 months and still a long way. Uh it's a long journey in the multiple year to make it a great company. And so, I'm delighted, had the honor to do it. And in fact, I went to uh China after 7 year I didn't back went back to China. And then some of the China's uh friends and CEO that I back, uh they told me, "Hey, Lipu, you are the first Asian uh Intel CEO. And then secondly, you are the first CEO can drink." And so, something special with them. They said, "Okay, Lipu, we love it." And the other part is you still use WeChat and we can communicate with you. So,
Well, thank you. Well, it seems to be you always very good at convince your boss, I mean the boss at home. So, there's another boss you seems to be convincing at ease as well. On August 7th last year, you got a call and the president asked you to resign. Right? And that was a crisis. Um and you flew to Washington on the 11th. And a few days later, the your boss is your best friend. So, for some of us who is very have hard time working with a boss, what's the secret here?
Well, first of all, you know, this is one of the chapter I'm not trained for it and it's a surprise for me. And uh sometime in this job, you know, have a lot of surprises, good surprises and you know, difficult such as surprises. Uh this one, Thursday morning, and uh 5:00, I have a lot of call and uh I would realize that president asked me to resign. And uh so, I usually in the morning, first thing I do is the meditation and then secondly, go to swim and gym and uh it disrupt my rhythm of the day. And um you know, I talked to myself. First of all, I really no need this job. And then so, I took myself out the equation. Uh it's not about me. It's about Intel. And so, with that set aside, then I will fight figure out what can I do to to save uh and support Intel. And so, first thing first, you know, you have to set up appointment to see the president. And so, um the good news is a friend of mine said a valuable it may become handy that phone number. I don't know how to help you, but I have a phone number maybe you can use that. So, turn out to be very productive. That phone number is mainly to get me the appointment to see President Trump. And so, that is Thursday morning and then uh I set up a meeting at 4:00 on Monday. And so, first of all, you know, first time I went to Oval Office. It's a beautiful office, but I focus on him. And then he asked a lot of questions and I try to answer. And so, long story short, I think they have some misinformation and I just telling the truth. And I born in Malaysia, I grown up in Singapore, and I did my nuclear engineering at MIT. And then I've been US citizens after that never live in other country. This is my home. And so, after 1 hour discussion and he asked me, you know, how we going to turn around Intel and how long to turn around. So, I gave him my honest answer. And then he listened very carefully and then at the end he said, "Well, today is 5:00 Monday. Uh Friday I want to announce. Do you mind US government own 10% of the company?"
And I share with him TSMC have Taiwan government Chartered Semiconductor Singapore government Temasek Holding due to me. And then also, you know, the Japan other country. It's a infrastructure is very important for United States and also very important for the industry. And it will take me at least 2 years to make the change. And so, somehow he like my answer and I think he social tweeted and then uh and then he want to have 10% and he asked me, "Do you mind I own the 10%?" I said, "No, absolutely. I'd love to have you guy and the US citizen to be all my shareholders." And so, that is a journey.
Thank you. Thank you for all this incredible lesson. We all can learn how to work with our boss from you. Thank you. Well, let's back to the business. Um you have done it once, you know, you many years ago you were been called up to uh lead Cadence. And uh after a number of years, you're extremely successful, almost a Harvard Business Book case. Um and uh what lesson you learned that you take the Cadence to Intel and obviously Cadence is a smaller company compared to Intel. So, what it works what may not work there?
Good question. So, I think uh Cadence is the first time I'm the CEO and also the turning around the company. And uh so, they reach out to me multiple time when I send my son Andrew to CMU and the phone keep ringing. So, finally I had to answer. They said, "Oh, when can you rush back?" I said, "Sure, I'll come back." And they basically asking me, "Lip-Bu, you want Can you be the CEO of Cadence Design?" I said, "No way." And uh you have a wrong person. So, turned down almost 10 12 time, but they don't take no as a answer. And I really enjoy what I'm doing building great company and a startup. And um when I came on home and I meet up with them, they said, "Lip-Bu, just do it for 3 months while doing a search." I said, "Okay, that may not be too bad." So, I focus on uh doing 3 months and then really focus on, you know, engineering uh focus on engineering focus. Secondly, spend the time visiting customer, learn what what went wrong and then I can do to change that. And then um um and then the culture got to change and you got to, you know, listen carefully to the customer and then learn from customer what is really important and then focus on product getting better and then just to being humble and willing to learn. Um you know, many of the employee of Cadence, they are my teacher in the evening. And then taught me about digital flow, analog flow, verification, all the detail. And so I'm delighted to learn that and also have a former executive VP that I thought he would be that the best CEO. I said, "You should come back and run it." He said, "No." And uh so I run out of talent and then meanwhile the board said "A while you were you should part of the search." And I was so busy. I said, "You know what? You guys do the search." And then did you if you find a found the right CEO and then give me let me know and I'll pass the key. And after 3 months the chairman came to me in my room smiling. I said, "Okay, must be good news. You found someone to replace me." And he said, "No, you can keep the key." I said, "Wait a minute." And uh so that 3 months become 15 years and uh 13 years as a CEO and I'm very proud to recruit the person that I thought he would be the right uh successor. And then I I persuaded him to move from Austin to come to California and then find a home for him and I make sure that daughter went to the right school. I'm persuading him to the right school. And long and behold, I think that's one of the best thing I did, find a successor and then I have a 4 years of period of working together before I passed the torch to him. He'd done a fabulous job. So I think I thought that I'm done. And so I think question mark is, you know, your question. Uh Cadence is a little bit simple because it's a software company. And then also I think EDA is is challenging, but you can very learn very quickly. And so, there are some area we can apply like a culture change, focus on customer, focus on engineering, and then you know, try the success, get the put the best team. I used to be a college and high school basketball team. I play power forward. Always championship team owned by the team and led by the team. So, in the way, I always want to surround myself smarter than me and I can work with them. I can empower them. So, I think that part I will continue to apply to Intel. But certain part of Intel is different from Cadence. Well, we have a big operation manufacturing like advanced packaging. We have foundry. And then those are kind of more capital intensive and a very different type of products. And we also have product that you have to deal with supply chain, dealing with inventory. And so, those are a little bit more complex, but some area like culture change and discipline of delight customer, listen to the customer, I think apply the same way. But some other area a little bit more different and so, you just have to learn and apply the right way. One thing that if I can give anyone advice you know, either as a founder or the CEO one of the best advice I got from a from a very good friend of mine when I turn around Cadence. And I was very worried and nervous about making mistake. And for first 2 weeks, I didn't sleep that well. And then in fact, I even prepared three time the resign letter. And then I draft it, I modify and I don't like it. I throw it away and do it again. And then prepare to submit the resignation that I don't think you are the right person. And but and then one good friend of mine, he told me that Lip-Bu if you make 70% of your decision, you are damn good CEO. And I mean that I can make mistake and I can learn and I can do my homework. I can make decision as a yes. And that give me the courage that I can make decision and different from being a venture capitalist, you're backing on somebody else to make the decision. But here, you know, you have to make the day-to-day decision. That worry of making mistake and that handicap me. And then but I'm glad he give me that advice. And then to all of you, if you're CEO, it's okay to make mistake and do your best, do your homework and make decision.
Thank you. For those who you don't know, under Lipu's reign in Cadence, Cadence has grown more than 80X in the 15 years. It's incredible. Um So, you mentioned that you have a knack for talent. So, recently I know that, you know, AI is moving to a genetic phase, which is perfect, which is great for Intel, I think. Um but at the same time, you hired um uh someone from Qualcomm to lead the GPU, Alex. Yes, correct. And also you hired former CEO of SK Hynix. Choong Khye Lee. And so, both of them have very different special background and GPU and HBM memory, etc. Does that mean that Intel is trying to position itself as a competitor to Nvidia as alternative to full full stack solutions?
Yeah, I think you know, first of all, uh this is a multi-year journey of turning around. Uh you know, we try to do everything, try to fix all the issue and then try to regroup and then claim the leadership. And then clearly, you know, CPU is our franchise. So, I triple down on the CPU architecture and then how to do the compute you know, GPU, CPU accelerator, quantum. I feel that this is a all the compute uh platform that we have to be claimed the leadership. So, something that I had to work on. And then secondly, on the foundry and packaging, I think we have a chance to be a one of the leader to do that. So, I think all this is a I always look at company you know, you have to look at beside this quarterly earning I have to deal with. But more important, you don't lose sight of 3-year, 5-year, 10-year plan and what what you want to be. Then you have to work towards that. So, I always, you know, thinking much longer term. And then the other part is the market is so big like you described, you know, AI is driving the semiconductor. We want to make in semiconductor great again. And then in some way, you know, people talking about I even remember IBS talking about 1 trillion by 2030. Guess what? We already passed 1 trillion. And then people are talking about 2 to 3 trillion. And I still remember when I you know, I was after I resigned from Cadence, couple of important big financial investor group asking me to be advisor. One of them I accept. And I told him that you should invest to Nvidia. And Nvidia can be over 1 trillion market cap. And he almost laughed at it. But I said that you should invest, but at least you took my advice. And now it's 5 trillion dollars company. So, I think in some way I think thanks to Jensen, thanks to Lisa Su. They all drive the semiconductor success. And of course, some of the equipment company good friend, Gary from Applied Lam Research team and ASML Kristo. So, I think they are all done a great job to really build the industry. So, for me, I play a part of that industry growth. And so, to me, it's more important to create opportunity for the industry. And then And some of them are very good friend of mine. So, in fact, when I turn around, the first thing I reach out is Jensen, my good friend. And he invest 5 billion into Intel and also have a joint development. And I appreciate that and have confidence to support me. So, I think, you know, the the market is big enough. Uh you're always able to find thing area that you can work with. Even recently, I talked to Lisa Su, good friend of mine. I said, "Lisa, we have to find some area we can work together." So, I think, all in all, my approach is basically we can compete at the same time we can collaborate. The market is big enough. Uh you don't have You can't do everything by yourself. So, in the way that collaboration, I formed a lot of partnership even for follow the 18 months. I announced some of the partnership. And that you're going to continue seeing me create some great partnership with different industry leader. And then there's some way that you can learn from each other and then help create the bigger market for all of us. So, that's kind of my approach.
Right. Right. Yeah, definitely, you know, it's interesting that, you know, you uh um you're somewhere competing um with some of your let's say media and D, but at the same time, the media is investing you. So, and Sanjay is your good friend. So, it does it seems to be interesting that um you know, it doesn't it doesn't make really, you know, the Thanksgiving dinner more interesting, you know? Uh you know, you um you you your friend and while you're being a competitor. So. Thanks. Uh but yeah, but there's one thing that I I want to check with you cuz this is something that I it's been I've been thinking for a long time cuz it's it's a rare to uh have someone who has been invest in um hardware for this law. You have been investor In fact, a legendary investor Um in the space for a long time. And years ago, if you walk into a VC uh room, and if you talk about hardware, I'm sure they're going to walk away. They say like, "Well, software." Um I don't think anybody interesting in years ago, but now it's different. So, what make you so persistent on investing in hardware when no one cares? I mean, I I know you you you have over 100 successful IPOs, over 600 100 successful acquisitions. That's incredible statistics. I mean, what why you see things people don't see?
You know, uh when I was in college and I in Singapore Nanyang U, and then uh some of my professors said, "Well, Lip-Bu, you're doing great, but your brother is smarter." And he got the Rhodes scholar. So, I want to do something different rather than compete with my brother. And then secondly, you know, when I went to MIT, and um you know, the placement director tell me that there's no future in nuclear power. I was nuclear trainer. I supposed to be in PhD. And um so, I had to change field. And I was working came to San Francisco Bay Area, working for EDS Nuclear, and so working on the nuclear. And then that's give me an idea that first of all, I don't have a PhD, so I always have a chip on the shoulder that I have to work extra hard than anybody else. And um in some way it become my benefit. And so, I have that curiosity that's a very important. So, in the audience, and uh it's very important to have that curiosity mind. So, you know, one of my interest, you know, to do startup, you know, many of them I I just come across some many friend of mine that I back them, and they have turned out to be a great successful company. And it's a it's a joy to see them successful. And then be part of that journey with them. Couple of them I mentor of them. And in some way there's a lot of joy to see their their view, their mission, their vision being fulfilled. And I play a small part of supporting them. And that give me a lot of joy. And also give me a lot of learning. And some of this I put some Every Saturday, Sunday there's a time I do meeting with a lot of startup company. And some of them are in the audience. And and now I'm investing in them. I learned so much about what they are doing. And that to me is also relevant in my day-to-day job, you know. And Intel lost missed the whole mobile. They missed the cloud. They missed the AI. And I convinced the board at Intel and also Cadence, let me continue because it's very important to plug into the entrepreneur venture capital community. So you know what are the big wave going to come out and you don't want to miss that. So that's something that you know I I really enjoy doing it. And then it's my hobby. And my wife said about as long as you still make money, that hobby you can keep. So that's my
Well, for for those you don't know, you invest in Cerebras. I know there are Cerebras reputation here when it was $16 million valuation. And now they're in $40 billion. It's incredible. And then you invest in Samonova in $12 million valuation. Also incredible investment. And thank you. And is there any deal that actually you missed that you regret?
