Good Disruption: Disruptor: Faraj Aalaei, Cognichip

UVA Darden.

The Disruption, a lively discussion between UVA Darden School of Business professors Yael Grushka Cocaine and Mike Lennox on cutting edge technologies and practices that are challenging the status quo.

Welcome to our special subseries on disruptors.

In this episode, Faraj Allawi.

And now over to Mike and Yael.

Hey Mike, welcome back.

I know that you were traveling.

Hey Ael, yeah, it's good to be back.

I was out in the West Coast for about a week and a half there.

Isn't that always great to get some of that California sunshine?

Oh my goodness, it was 70 degrees, low humidity.

The whole world was out.

Apparently though, it's like getting into like the 80s there, which is I've heard of in San Francisco.

Yeah, I'm jealous.

No, it was, it was a good trip.

What was your biggest, uh, impression?

What did you come back with, uh, in terms of your thoughts?

Well, I often do when I go out there.

I had an opportunity to visit some of our alumni at both Meta at Google and some startups and the like.

And, um, you know, it's gonna be a shocker to you.

Uh, AI disruption is, is upon us.

It's like this is not this is no joke.

This is no joke.

This is real and the the disruption is upon us.

Well, I'm glad that you had to go all the way to California to find that out, um, in, in ways that surprised you.

Maybe or not necessarily.

Yeah, I mean, I think the thing that I heard that that probably surprised me the most was um the the latest version of Claude from Anthropic seems to have been a game changer in the coding space, and we've talked about this before on the podcast, uh, with Claude Code and the whole idea of vibe code coding that has been popularized over really just the last 12 months or so, this idea of co-creation with the AI.

I, I think it might be dead already, already, like it was a nice moment there in 2025.

Cycles are getting shorter.

They're getting shorter and shorter, and, and the reason is that it, it's not even necessarily co-creation in that way, that it's really now.

Give the prompt to a couple of Gic AIs and they get to work and the next day you have new code being, you know, deployed, uh, fully tested and, and the like there.

Concerns about technical debt and kind of like exactly how good that code is or or well, if they don't so, but I, I think again what what we're seeing is that the AI is.

Doing a heck of a good job with it.

And so, yes, you still need humans to kind of review and, and, you know, make sure that it that it works, but, um, man, it's, it's apparently like really, really good now.

So, yeah, the, the, the disruption is upon us and I think it's gonna really change how we think about um code development, which we've heard for a while now, but It seems like the next big step is occurring.

Perfect.

So like that actually ties in exactly to what I wanted us to talk about today.

Um, so I'm really excited.

We're gonna, um, I'm hoping that we can engage in a, a great conversation with one of our, um, our disruptors again today.

I love this.

We're doing good disruptors, good disruptors, amazing disruptors, inspiring disruptors, um, and specifically from the, uh, the chip manufacturing sector.

So, uh, really kind of related to the AAI because I know that at the heart of it.

A lot of the options that are now available to us and where the future is going really relies on our ability to have the tech and the hardware to support some of this, uh, great, great innovation related to AI.

No, I mean, amongst all the amazing stories that have been happening over the last few years, I think like the story about Nvidia and how they went from, you know, an important company doing GPUs for gaming systems and graphics and the like, to be one of the highest valued companies in the world.

And they just seem to be getting better and better and bigger and bigger and bigger, um, but yeah, chips are at the center of all of this and always have been.

That's why it's Silicon Valley, um, but I'm, I'm excited to learn more.

Wonderful.

So maybe we can, uh, invite our guest in to join us, our disruptor.

We're so honored that you can join us today.

Faraz Allawi is a founder and CEO of Cogni Chip.

Faraz is a very successful entrepreneur, really inspiring so many here at the Dart.

In uh iLab and beyond, uh, with over 40 years' experience, he was doing this before many of us have even heard of some of these before you were born.

Yeah, well, no, sadly, no, but yeah, I teed that up.

You could have easily said rest.

I wish, I wish, no, I'm proud of my 51 soon, soon 2 years.

Wow, you're really just, just put it out there for the world, yes, but for us it's over 40 years' experience, um, in the communication and networking technologies recognized in the.

Silicon Valley as being a really true technological innovator, um, disruptor, if you will, at the forefront of critical technology development, from the world's first optical ring communication system to pioneering system for cable, uh, modem, remember that?

So, that was groundbreaking at the time.

Yes, no, we're old enough to remember modems, exactly, broadband, DSL, um, autonomous driving, um, ethernet communications, and the like.

He holds multiple, multiple patents, obviously.

Um, and an honorary doctorate, um, in engineering, success, so many, um, accolades and academic credentials, uh, that I wanted to mention, um, Wentworth Institute of Technology, University of Massachusetts, University of New Hampshire, and even the 2024 recipient of the United States Ellis Island Model, um, Medal of Honor, um.

We are really honored that you are here for us.

Thank you so much.

Uh, maybe we can start by telling us what is your current endeavor.

I know that you are involved in, um, AI and, and, and, and chip intelligence.

Tell us a little bit about the current company, um, that you're, you're leading.

Thank you.

First of all, I'm glad to be here.

Uh, I, I wanna mention that the name of your podcast, Disruptor, is kind of interesting.

Um, you know, it reminds me of when, when you're young and And a kid in the class would raise his hand all the time, you'd be called a disruptor, which wasn't a good thing.

In, in the world of entrepreneurship, it's a, it's an accolade that uh that makes you, uh, makes you kind of unique in, in that sense.

Um, yeah, so, uh, thank you for having me.

The, um, The the the problem set that I'm focused on really goes back to the last two companies that I built, um, which were, you know, uh, semiconductor companies, you know, we built chips for enabling broadband, and then the next company, uh, which was Auanxia, we built chips that enhance the capability of data centers to handle higher. higher capacity traffic and in all of those times, um, and over that same period, there was a tremendous change happening.

In that the cost of developing semiconductors was just increasing significantly, and as a result, the venture capital companies would be investing less and less.

Just to give you an idea, you know, tracking from 1980 to 2000, it was an ever increasing number of semiconductor companies that were founded here in the US.

And this peaked in the year 2000.

Obviously, remember 2000, we had the hype and, and so on and so forth.

So hype's always, always help.

But then post 2000, it had a precipitous drop, uh, where in 2000, we funded 200 new semiconductor companies in America.

Uh, by 2015, this was down to like one or two.

Wow.

Wow.

Can I ask you a question about that?

Are, are you making a distinction between, um, chip design and chip actual fabrication?

Are these, no, this is, this is chip design companies.

Chip design, OK, yeah.

So they might be outsourcing the actual uh manufacturing.

Yeah, the manufacturing for over the last 30 years or so primarily has been just, uh, outsourcing it out to Taiwan and, um, and other places.

And so, um, that to me was a huge alarm there, because if you don't have startups challenging the big, big folks, uh, you're losing a lot of that innovation.

And and and the reasons for it were pretty obvious at that time because chips during this period were getting more and more complex, bigger and bigger chips, requiring a lot more engineers, obviously taking longer time to do, and yet the way we were developing chips hadn't changed in 30 years, right?

So that drove up the cost of development, which ran, then, you know, a lot of VCs would run away because at the same time, if you remember, you know, the SAS platforms came around and software and software companies were easier to invest in.

So there was this sort of like disconnect between what we needed to do as a country to make sure that we produce the latest and greatest technology, um, that was the foundation of building systems and services, um, and uh and what we were actually doing in in in in practice.

So it was always a problem in my mind um that how do we, how do we stop that?

How do we improve that?

Uh, comes along, you know, uh, AI, of course, uh, Johnny on the spot, and, uh, and it started to really change a lot of things.

Some of the biggest breakthroughs that were, for me at least, they were the, the start of thinking that this may be possible for our industry was, you know, when Google DeepMind, um, developed essentially the technology that translated into breakthroughs in in protein folding in the medical field.

Right.

Um, and, um, and so in late 2023, I started to think maybe there's some application of this that I could use to solve some of the problems that I just described.

And, uh, and part and parcel of building a company is always figuring out who are the, who are the guys that you're going to go to a battle with, right?

Finding uh the appropriate uh co-founders, right?

Um.

And so I, I reached out to a friend of mine who was helping me evaluate AI companies for investment.

And, um, and reached out to him, and I described to him the problem statement.

This, this guy was a PhD in math from University of Toronto.

He didn't know anything about chips.

He didn't know chips from potato chips.

And, uh, and, and I described to him the problem, and he said, you know, he thinks, he thought that it was interesting and maybe AI generative AI could, could have an impact there.

Then he calls me back the next day, he says, I didn't sleep all night.

I was reading papers after papers, and I believe that there is a path for us to go where you want to go.

And so that was sort of like the the beginning of us focusing on this, on this situation, um, on, on application of AI in the semiconductor industry.

Um, what I want to say is that also when you look across the industry and all different applications, they all really use AI in a different way.

Um, when you think about, uh, physical sciences, things that have, I, I would just not even say sciences, um, applications that have a, um, a, a, a, a physical dimension to them, like transistors, like protein, like the robotics.

Um, they are really different than solving math problems or solving, um, even software coding, um, because at the end of the day, whatever it is that AI generates, it'll have a physical incarnation at the end of the day, and that physical incarnation is really what you're looking for.

So precision becomes really, really important.

The hallucination is not allowed, for example, in the chip business.

You know, we put 10s of billions, hundreds of billions these days, transistors on a piece of chip, you know, that's that's not even bigger than a potato chip, and not one single one of them can be placed wrong or envisioned wrong, right?

So, so you're talking about a different level of precision that you need to do, and in those industries, um, In-depth understanding of the end application becomes really important and how you use AI to solve that problem.

I love that.

That's such an interesting observation, right?

Like that some of what we're so used to thinking about it in the context of software or text or writing or, or, you know, some, some more individualized use, but not bringing to life something that is physical in nature where you need that precision.

Can, can we go back a little bit and hear a little bit about your journey, your personal journey, uh, for us?

Can we hear a little bit, you started as an engineer, and then you, uh, uh, developed into a founder, uh, a serial founder, uh, at that, uh, how do, how do you, do you go from starting as an engineer and then gaining that insight and that desire to be a founder of a company yourself?

Yeah, so, so I was fortunate, uh, in my, in my career.

So I, I, I graduated uh with an undergrad degree, um, frankly, before I was even like 20 And I ended up in my, after my first job at the company designing video satellite communication systems, I ended up at Bell Labs.

Uh, one of my professors at graduate school pulled me into Bell Labs.

For our listeners who are maybe a little younger and don't know what Bell Labs is, this was AT&T's very famous R&D lab that invented the transistor, amongst other, like, seminal inventions that came out of there, so, precisely, and, and it was, it was a place where innovation was really celebrated, you know, Bell Labs had 25 um uh Nobel Prize winners.

And it wasn't, you know, it wasn't unusual for you to run into one of them in the hallways, right?

So you get inspired as a, as a young engineer, and, and, um, and so it was a place where, you know, innovation was, was like, let's say, cheered, and as a young engineer, learning things and and trying different things was permitted completely.

And so I did that for quite a while, but then, you know, I started to get really interested in the business side of things, and of course Bell Labs was not a place for business.

It was a place for innovation and thinking.

And uh I convinced them to send me to business school, which, which worked out well, and then, but when I, when I was done, there was no business to do with Bella.

So, of course, you know, it's amazing to think about an R&D lab with that philosophy, like, oh, we're not really in the, the world of business, even though we are a corporate, you know, R&D lab.

Yeah, I know it's quite a challenge, by the way, to get them to send me to business school.

They tried everything to do to convince me to get a PhD, and I'm like, no, I, I really like this this is great for our listeners, you know, two of us professors at a business school, yeah, so I started to kind of have a bit of business band later in my career, and, and, um, and then, um, yeah, I, I, I knew some people in Silicon Valley, and, um.

And came here to California to start, to start our first business, which was building DSL chip for broadband connectivity.

This is transitioning from what some of the audience probably would know dial-up modems to to something you could use constantly without occupying your phone line.

So, uh, that was, that was the beginning, we, we had, um.

A, a, a wonderful, um.

Combination of, of really a good team, great timing, and, uh, and a hell of a lot of luck.

And so, um, you know, luck, luck has a lot to do with, with everything, and, um, and I, I can cover a whole episode about how lucky I've been in life, and, and give it to you play by play, so that it's not just, uh, it's not just fluff.

Um, but anyway, so we took that company public, um.

Uh, I ran that company for about 8 years and then moved on to do another one, which was a plan, and this one took a lot longer to take public.

The first one took from opening the doors to taking it public was 3 years.

And, um, and I was a first-time CEO, first time really founder of a venture backed company, and so I was learning on the job and, and a lot of it was fun, but a lot of it was also tough, frankly.

But, um, But my message to all the entrepreneurs is that you really learn about running a business when things are tough, when things aren't going your way.

Yeah, I was gonna say, can you tell, give us one thing that was fun and one thing that was tough.

When we started, um, as I said, within 3 years from opening the door, we were going public.

The business was going crazy.

We were dominating the Japan market, and we couldn't build fast enough.

So any kind of stupid move that we made, anything we screwed up, would just be not even noticed, right?

And so it was, it was fantastic.

Everything was good.

And then telecom freeze of 2000, you know, the the the the Wall Street starts to crash in 2000, which was exactly the same time I was taking the company public on a road show in New York, and And I would walk into these, uh, um, you know, hedge funds or long funds, and they would say, what are you here to do?

I say, well, I'm here to sell you a new, new, new stock, and they're like, well, I'm losing my shirt elsewhere.

And, um, and it was a tough time to take the company public, but, but we did get it out, and it, and it, and it, and it reached really good heights.

But then two years later, the telecommunication industry as a whole uh started to crash.

And that crash was really difficult for a small company that was still on its on its ascendancy and still didn't really have all of its gears in place, you know, there is some wisdom that comes with maturity and the companies also do go through the same thing.

They need to mature in time.

And so when that happened, uh, all of the customers kind of pulled back, and when the customers pull back, you lose that oxygen for a company, which is your revenue coming in, right?

And then you have to start to kind of justify every little thing that you do in the company, and those are, those are tough decisions.

Those are tough times because it impacts people, it impacts where you're going.

It starts to take away from your vision.

And uh and so, yeah, there's a, there was a lot of learning in that, in that, and, and a lot of, a lot of, a lot of excitement in the front end piece where, you know, everything, of course, was going great.

But uh, but yeah, so that's, that was, that was really a good um good learning experience for me.

The second company took longer to go public, so it was just a lot more kind of settled in before I took it public, and 2 years after we went public, the, the, the um Marvel came knocking on the door and they acquired the company.

We sold to another public company.

And um and after doing the transition, I decided that I was just, uh, you know, going to invest, invest in entrepreneurs, um, and help them kind of go through their journey, uh, which was itself a great learning lesson when you're sitting on the other side from where you yourself were, and, um, and, and, and you start to do pattern matching, quite a bit of pattern matching, frankly, in, in, in investing area, and And it was, it was sort of like 3 or 4 years of that, which included the COVID time.

But then this AI thing started to, to really percolate in my mind and, um, and I was on to doing the 3rd 1.

I, I think what's amazing is, you know, a serial entrepreneur, and, and I would assume there's some common threads technologically, but these are still pretty radical, different companies that you've, you've worked on.

Is that a, is that a fair assessment?

Mike, you're, you're, you're absolutely right on the spot.

So, I, you know, sometimes you kind of sit back and look at your life, uh, you know, you're moving through it so fast, you don't have the opportunity to look back.

And I look back about a year or so ago.

So what is the pattern of, of my life, right?

You know, uh, and, and I realized that, um, I never went from a job to another job, or from a project to another project that was the same.

It was always a new disruption.

Now, I was, I, I, as I say, I was lucky enough to be in those times, in those jobs, in those availability of jobs that, that were, um, were, um, you know, given to me.

But I went from being a, being a satellite engineer to being a wireless technology engineer to building the first optical system to building what's now known as cable modems that, you know, Comcast or whoever gives you, we built those very first ones at Bell Labs to go on and building a DSL company on my own, which, which was completely different, um, different kind of way of doing things, different industry, different field.

To then, uh, going into data networking, which had nothing to do with telecom, and not going into AI and software, which has nothing to do with hardware.

But, um, but I think, I, you know, I looked at that pattern of my life and, and I realized that, you know, really one of the, one of the things that, that, you know, we ought to think about as we think about entrepreneurship is openness.

Uh, openness to change and openness to going after something that you may not know a lot about.

Uh, this is my first software company I'm running.

And I've never ran a software company.

Of course, chip companies have software engineers, but this is a different type of company, different types of elements, and you just have to be open to it because there was a lot of learnings that carry from one industry to another or from one sector to the other.

There's a lot more in common than we think.

So, sort of like, you know, putting your, your hand out and saying, no, that's not my thing, is uh is, is probably a mistake in most cases.

Well, what I love about this is, uh, you know, here at Darden, we teach a lot with the Socratic method, so we ask a lot of questions, and what I hear you say is that kind of thirst for learning and that inquisitiveness, that kind of Helps you, gives you the confidence that you've mastered other industries before, you've pivoted, so why not try something different, like moving into software, cause you know that you can kind of uh learn by asking and by kind of being on the ground with your team, right, um, as a way to kind of get gain that expertise in a, in a completely new kind of business.

Yeah, and, and, and, you know, my, my, my rent a car company when I was 19 years old, which were driven out of, out of like a pain point that I had as a as a student, didn't have a credit card, so they wouldn't rent me a car.

So I thought, oh, great, let's, let's go build a rental car company that doesn't need credit cards.

And of course we lost all the cars because they left them out on the roads.

Nobody brought them back.

And so, so the, the what, what you learn from these experiences um is that What I call industrial logic has to be there.

So as you think about businesses you go in, one fundamental question is, what problem are you solving?

And is there a um is there an industrial logic for how that work actually will have a payback, right?

And you got to solve those things in your head, and if you get clarity on those.

In my view, the rest of it doesn't matter.

It's, it's, it's challenges you can solve.

If there is a there there, and you're ready to go, take that, take that journey.

Everything else in the middle is about people problem solving together, um, and that's really the essence is an entrepreneur's journey in any company.

Well, I have a 19-year-old who can't rent a car because now most of the car rental car companies are limited to 25.

That's right, um, so he is very keen for more disruption to happen in the car rental company.

So once you're done with cognit chip.

You know, go back to that original idea of yours and go back to trying to solve that.

It's gonna all be autonomous vehicle, so it's not the problem's gonna solve itself.

Yeah, you know, that's kind of, that's kind of taken care of now.

It's way more, way more, way more this idea of like continuous learning.

We always talk about lifelong learning.

I had an interesting conversation I was out in the Bay Area about, and this has been obvious for a while, like it is.

Fruitless for us to teach, like, the state of the art in AI.

Like, we need to do that to some extent, but it is outdated almost immediately, immediately.

So teaching our students how to learn, so they can continually be educating themselves and staying in front of the technology waves, that's what's important because, because the technology is moving, moving so quickly.

Yeah.

One of the things that's made This country great.

Is this idea that entrepreneurship and trying things that may even lead to failure, it's, you know, in Silicon Valley, that's a badge of honor, right?

And, and this is not the same in every society, you know, there are, there are more conservative societies out there, you know, advanced countries, with more, more, you know, more where failure is not an option, and that prevents people from trying.

And what we have here, which, you know, I think.

You know, students at Darden obviously understand is that you got to try something.

And if, if you fail, the next time you do better.

My rental car company taught me about asking good questions.

Just because you think it's good, that doesn't mean it's gonna.

Well, I've heard the line though that you know you have to fail 3 times before you're truly an entrepreneur in Silicon Valley.

I, I don't, have you actually failed 3 times yet?

I think you guys keep having success after success, so I, you know, maybe you don't qualify yet.

You add up a few more failures.

I've been fortunate, but I, I did all of my failures early on when they were in that big.

But it, but what you're saying is very true.

I mean, um, we just, uh, finished spring break here at Darden, and we had, um, uh, somewhere maybe 7. 6 or 7 groups traveling internationally to different destinations.

We had groups of students traveling on courses, academic courses to Brazil, uh, South South Africa.

I took a group to Austria, there was a group in South Korea, Vietnam, Australia, and Japan.

And one thing in my Australia, and in my Austria trip, excuse me, my Austria trip, the local folks that we met with, which were all around AI, our topic was AI and, and disruption.

Um, it was interesting for the Austrians to reflect on the role of culture and the role of like thinking about what separates the US or where, how do they get more of an entrepreneurial spirit going on in terms of both their own innovation and the generation that they're kind of looking, uh, to uh, uh, to.

To, to rise and, and it's, it's just been very interesting that where we come from and cultural norms and, and everything from schooling to policy makes a difference at the end of the day in the entrepreneurial landscape, um, for sure.

I think that the, the most important thing is, is, is to, if there's a way to teach um people to be curious, um, and to, um, to ask questions.

You know, a, a, a lot of time, um, you know, I'm, I'm an engineer by training and, and obviously then in business for a long time, but a lot of my contribution in my company really is sitting in meetings and asking questions, right?

I'm, I'm, I'm, I'm never going to be this, you know, deep, uh, AI scientist, um, right?

And, or, or even frankly, uh, a great chip designer, um.

But if you, if you can learn to ask relevant questions.

And get a process of conversation going within teams, then I think as a result, the whole team will actually feel more confident about the path that they're going, right?

So, um yeah, we don't all have to be engineers, we don't have to all have to be mathematicians, but we can all contribute in an environment where all of these people get together and trying to disrupt.

And disruption comes with risks.

Uh, you know, it's interesting, I'd be curious your thoughts on, like, the notion of, of expertise.

You know, we have students sometimes who are like, I wanna do something, but I wanna, I, I, I need to get more expertise in the industry sector, uh, and the like.

And obviously, the data, somewhat all over the map, but, you know, some evidence that a lot A lot of founders are later in their careers, you know, maybe, you know, 40s or 50s, uh, but obviously we have also the stereotype of, like, the 22-year-old going out and starting a business.

But what are your thoughts on maybe when you're building out a team for a new venture on, on expertise and experience?

Yeah, so, um, you know, part of the pattern matching that I was talking about when I was investing, um, in just my own, um, experience in building companies.

Is that um nothing replaces.

Um, the, um, the, the, the, the maker of the team at the beginning.

And this is not just even the founding team, it's founding team and probably the first, you know, 2030, 40 people that you hire on a company, if the company is lucky enough to grow to that level.

And so, um, complementary skills is to me the number one thing you got to think about.

If you're starting a company, your best buddies are not necessarily your best partners in building the company.

Just because, you know, you guys have fun together, just because you play the same sport together, or you go to the same bars together, that's not the definition of of a compatible and complementary team.

There are the world of, of, of science and technology in particular, or, or even frankly not technology companies, just any other company.

There are so many issues, there's so vast, um, vast area of expertise that that not one human being can.

Can obviously um be competent in all of them, but you gotta pick team members that are compatible in the way they think about um uh entrepreneurship, but also compatible and complementary in their skills.

So you're an MBA student, you want to go into an area of deep tech because you think you've found some, um, some market dynamics that, that you believe in, some vision that you believe in.

Then go talk to somebody in the computer science department, electrical engineering department, figure out who that person is that's going to complement you, and that's how you build.

It's one brick at a time, and the initial bricks are the most important bricks, so you just can't, you know, willy nilly go out and, and, you know, do a startup, so you got to think it through.

Yeah, I like that vision cause it's very interdisciplinary, so meaning find those those those separate expertise, the wider range, and kind of think comprehensively, not just, you know, everybody in the same doing the same thing.

And we, we talked about in our MBA environment, the students coming in come from vast uh divergence in backgrounds.

So some have engineering backgrounds and technology backgrounds.

Some were history majors, that's the journalists, you know, uh, politicians that come to us, and I think that idea of bringing Bringing those um desperate skill sets and then how do they complement another really, really resonates.

Um, can I pivot a little bit and, uh, kind of pick your brain given that we have you here as such an expert in the field we started off by talking a little bit, Mike, about your trip to California.

Um, so what are, what are your thoughts, uh, uh, right now for us as you look at what's going on in the, uh, semiconductor industry, like, uh, what is your take on what's going on and kind of what is your prediction in terms of like the big, the big thing on the horizon Can I, can I ask a more specific question before we get into the broader because I meant to ask this earlier.

I am curious with the application of AI on chip design, are you seeing what we've seen with the application of AI and some other domains?

Everything from chess to you mentioned protein folding, where the AI seems to be able to come up with out, out of the box thinking, just, you know, ways that like any chess master would have never thought to do that sequence of moves, and yet it comes up with that.

Are, are you seeing the same thing in chip design?

Yeah, and to be honest with you, yeah, I, it, and it's fascinating what, what it, what it can do.

Um, we took a, um, a, a customer's problem, a challenge that they gave us.

And, um, and so we, uh, you know, before, just so we were set on, on sort of like what we were getting, it's like, OK, well, if you do this thing in-house.

How long is it going to take you to solve this problem?

And this wasn't to solve a massive device.

This was like, this is a hard problem, it's sort of like a, you know, contained.

Um, so, well, you know, we probably can, you know, if we put 3 good engineers on it, there'll be about 12 to 15 weeks to solve this problem.

We were able to solve that problem in 2 hours in the system, right?

Now.

Of course, you know, when you get to these complex markets like the chip, then putting these pieces together and making sense about all of them and making sure that every transistor ends up in the right place, it takes a little bit more effort.

But the, uh, but the notion that a chip company is going to do its business the same way in 2026 or 20207 than it did in 2024 is completely out the window.

Completely out of it.

Now, that opens up opportunities, but it also brings up issues.

So in my opinion, a lot of these industries like our industry, the semiconductor, have to rethink about what the organization looks like, right?

If I have, you know, a, a, a co-worker within the compute environment and not a human being, but a coworker that can do things a lot faster, a lot more diligently.

Than my best engineer can, the combination doesn't need to go home and take a nap and, uh, you know, go get dinner, you know.

But yeah, but the combination of those two can be explosive, right?

So if, if, if you're able to do a chip in a lot less time than you used to do before, now as, as a manager, as people that run the business.

Business, are you going to be able to get into new markets?

Are you going to do more chips, or are you going to reduce resources and stay with it?

My bet is, is that in every industry just like ours, you're gonna start thinking that, oh my goodness, now I have the bandwidth to go, you know, go into automotive.

I have bandwidth to go build chips for automation, build chips for um for military or or these and other applications.

The fundamental change in paradigm.

Is that you do not need people with all of those vertical expertise to be sitting under one roof or even be in the same city or even exist in your country.

Right?

Silicon Valley is Silicon Valley because we have an amalgamation of folks with lots of different expertise that we can put next to each other to create a product.

Why isn't that happening in Virginia?

Why isn't that happening in Nebraska?

Because although we might find some people with some expertise, we don't have others.

And this to me is what AI is going to bring to the table.

You get people with good ideas.

Some of the experts, the rest of it, the machine and AI can help you put together, and that democratizes this industry.

It allows people to come in, not necessarily having to study electrical engineering even, but be maybe a computer scientist or a math major who's solving a problem in their field, but wants it to run on a chip and run faster.

And now that becomes possible.

We never have had that before, right?

So, uh, I think it's, it's going to change the way people think about their businesses, um, and, and how to run those businesses and what markets to enter and not enter and which not an option we had before.

It makes me, it makes me wonder, so I teach business strategy, so my mind immediately goes to, this sounds like it's lowering barriers to competition and creating, creating more entry.

Always point out, like, you know, pets.com, who everyone beats up on for the, the dot com era.

It wasn't like there wasn't a market for pet food sold online.

The problem was there was no barriers to entry, so it just suppressed prices, made it very hard.

Well, I think we, we're gonna see a lot more entrepreneurship actually and more founders because the barriers to entry in terms of any company, any company are just like almost gone now.

You can a company in a box, you can, you know, unleash you think it's gonna be very hard to capture competitive advantage if everybody can do what you're, what you're doing.

I mean.

I think about it like an Intel in the chip space, right?

They had just a a lead on others in terms of design of chips that allowed them to have this incredible run, at least for, you know, the, you know, 40 years or so.

Is that going to go away?

Yeah, my, my, my excitement and the potential, for instance, for business school students in the future or business education in general. is that indeed if we do see more ability to to found companies to fail faster, to have more people experience that, uh, the, the ideas will just grow, right?

There'll be a level of creativity that we've never seen before building on top of already a layer of opportunity that we've never seen before because you can experiment and you can try things out and so you'll have new services and new needs for.

New products to support those types of founders and all that exploding activity in other locations, not just in the Silicon Valley, as you point out, yeah, yeah, and, and, and, and of course, you know, these tools will also be available in the hand of a larger company.

So we come back to, to like the rationale for what you're building, more so than the mechanics of how you put that chip together.

The, the, the idea that, and, and this is a great thing, I think for, for people who are getting educated in business is that that's gonna be a talent that.

That still is going to be needed strategically, what am I going to go after?

Just because I now have tools that can do these chips for me, doesn't mean I, I go in them.

Just because, you know, I, I think I should go into car rental companies business, that doesn't mean I should go in it, right?

So, the fundamental of the, of, of sort of like your strategy, your business, uh, what are you building, why you're building it, and, and how it's gonna, how it's gonna generate revenue and, and, and profitability for your investors, still very critical because large companies will also have access to these tools.

But there are, the, the constant is innovation is going to speed up.

Just like you said, Mike, that, that, you know, the, the, the Opus 4.6 versus 4.5.

I mean, you know, a few months go by and all of a sudden you have a whole different level of reasoning and capability in these models, right?

And, and so, yeah, the, the pace is picking up.

I, I think, you know, prudence is still, is still going to be important, but uh it's gonna be, uh, it's, it's gonna be fun.

If you're, if you're a college student and you're coming into this world of, of, of innovation and business now, you're gonna have a beautiful ride for the next several years.

Well, this is, uh, it's, that's so inspirational, and it feels to me like the right place for us to, uh, to, to thank our guest here.

Fara, you, you really shared so many great anecdotes for our Uh, listeners here around, you know, what it means to be a founder and a disruptor, and yes, I love the thought around how disruption in this, uh, domain is, uh, a kind of a positive, uh, attribute that makes things happen.

Um, we, we got a glimpse for your vision for the, the semiconductor industry and, and kind of where things are headed, but, um, uh, we share some of your enthusiasm in terms of the, the, the innovation that we're about to see and the opportunities that are opening up.

You know, this, we're, we're always optimists here on this podcast.

That's why I always refer to it as good.

Disruption, uh, but, uh, absolutely really inspiring stuff and, and just thank you for being with us.

Yes, thank you for being with us here today.

Well, yeah, thank you for having me here.

It was a pleasure to, uh, to be here and talk to you.

Mike.

I, I feel like we're now with these episodes, we're just gonna hear from our listeners the desire to wake up and found a company.

That was my secret master plan here at the end of the day.

Uh, as always, let us, uh, thank our producer Gary, our lead researcher Becky.

Uh, this is Good Disruption.

Thank you for listening.

Thank you, everybody.

Good Disruption is a podcast from the University of Virginia Darden School of Business.

Darden