Why do Nvidia investors care who Jensen Huang sleeps with?

Kean Birch is the Ontario research chair in science policy at York University.

Jensen Huang stepped down as chief executive officer of Nvidia on Thursday morning, after his admission of an extramarital affair with a suspected spy and reports of another affair with an employee. Shortly after, the company’s stock was down as much as 20 per cent from the previous Friday’s close. While it had already started to fall, the resignation likely exacerbated the downward trend.

But why do we and, more importantly, investors care who Mr. Huang sleeps with?

It relates directly to the increasingly vibe-dependent nature of our economies, especially when it comes to the promises, claims and stories that the elites in corporate, government and other sectors tell about the future of technological innovation. The current vibes are all about artificial intelligence solving all of our problems, and Nvidia is centrally implicated in this becoming reality.

To understand the vibe economy and its potentially pernicious effects, we have to understand where vibes come from.

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To do this requires a diversion into how to understand the difference between science and technology. Paul Nightingale, a professor of strategy at Sussex University in the United Kingdom, argues that the production of scientific knowledge entails a form of cognition in which people try to understand the world by extrapolating patterns.

Cognition is highly contextual, in that context defines what patterns to look for, how to look for them and which instruments we have available to do these tasks. This is why people talk about science as standing on the shoulders of others; we don’t do it alone. Science is inherently uncertain because, by definition, we don’t know what the end point is. Getting to that end point is the whole purpose (i.e. learning what we don’t know).

The cognition of engineers and technology developers is different from that of scientists. Engineering cognition is still highly collective and contextual, but it is defined by future end points – the purposeful development of technology.

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Developers have a goal in mind, they just don’t know how to get there yet. This is why promises about future technologies are so vital: They help turn them into reality by attracting investors who provide financing, governments who change regulations, consumers who anticipate new products and so on.

As someone who researches technological innovation, my sense is that technology developers have become increasingly performative and reflexive over time about these promises.

J.L. Austin, a British philosopher from the mid 20th-century, outlined the idea of performative speech acts. These are statements that denote an action, as opposed to the descriptive or analytical statements usually associated with science. Performative utterances include statements such as “I hire” and “I fire” you; they embody an action, often because they are associated with authority.

The success of technology developers is dependent upon their performative shaping of the world around them, in part through the promises that they make. Vibes, in this sense, matter enormously in the economy. It explains why executives are constantly giving talks at high-level conferences, going on podcasts and being interviewed in mainstream media. The success of their business depends upon their ability to shape the public discourse.

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Consequently, their personal lives matter. Executives have to convince the rest of us that their business is great, often by performatively presenting themselves as a fount of innovation and corporate success, without which the rest of us would suffer.

The danger is that executives can end up trapped in a circular and self-reinforcing logic: An executive is admired and lauded because they’re able to performatively shape the world, but they can only shape the world because they are admired and lauded. Once that logic breaks down, executives can become a liability.

Still, this performativity defines our increasingly vibe-dependent economy. Rather than a search for scientific truth or accuracy, vibes depend on alignment and agreement between executives, investors, government and others. As Mr. Huang’s personal life interfered with these vibes, it threatened his ability to convince other elites that he was still a fount of innovation and corporate success. That’s why it matters who he sleeps with.