Silicon Valley legend and former Intel CEO Andy Grove passes away at 79

Intel has announced that the company’s former CEO and chairman, Andrew S. Grove, who was born in Hungary as András István Gróf, died today at age 79.

Grove was one of the key figures of the information age, and he was famous for his hard-charging management style, summed up as “only the paranoid survive.” He was present as a founding employee at Intel, alongside founders Robert Noyce, who died in 1990, and Gordon Moore, who still survives as Intel’s chairman emeritus. Not only did Grove play a key role in making Intel into the world’s biggest chip maker, he also set the pace for competing in what has become a $347 billion global industry.

Grove became Intel’s president in 1979 and took on the role of CEO in 1987. He served as chairman of the board from 1997 to 2005. He wrote best-selling books, including High Output Management (1983) and Only the Paranoid Survive (1999), which encapsulated his Darwinian philosophy and helped set Silicon Valley on a treadmill of relentless self-improvement. He spoke out on an array of public issues that made him into a larger-than-life personality. To this day, thanks in no small part to Grove, Intel makes some of the most intricate, complicated, and lucrative products on earth — all from silicon, or what would otherwise be worthless sand.

“We are deeply saddened by the passing of former Intel Chairman and CEO Andy Grove,” said Intel’s current CEO, Brian Krzanich, in a statement. “Andy made the impossible happen, time and again, and inspired generations of technologists, entrepreneurs, and business leaders.”

Andy Grove was one of the giants of the technology world. He loved our country and epitomized America at its best. Rest in peace.

— Tim Cook (@tim_cook) March 22, 2016

Above: Andy Grove, former CEO of Intel.

Image Credit: Intel

2/ Andy Grove was a towering leader, mentor, and educator. He was ruthlessly, intellectually honest. And rightly proud of building Intel.

— John Doerr (@johndoerr) March 22, 2016

(See more reactions from Silicon Valley leaders).

Grove had a life that was made for the history books. András Gróf, who grew up in Budapest, Hungary, was born on September 2, 1936. He was nearly killed at age 4 when he contracted scarlet fever, and it gave him a life-long hearing disability. He was a pudgy kid, and was teased for being bad at soccer. He was awkward with girls.

He was a toddler when World War II started. When he was eight, the Nazis occupied Hungary and deported nearly 500,000 Jews to concentration camps. Grove and his peers had to wear yellow stars of David. His mother took on a false identity and was saved by friends. His father was taken to a labor camp. Many of his peers never survived the Holocaust. His father survived the labor camp and returned emaciated.

From a very young age, Grove said he wanted to be a journalist. He revealed this early history of his life in an interview with Time magazine in 1997, when he was named Man of the Year. He later wrote more about those memories in Swimming Across, the most personal of his memoirs, published in 2001. In that book, he disclosed that his mother was raped by Russian soldiers.

The Soviets occupied his native country, and, in 1956, the Hungarian Revolution broke out. The occupying Russians arrested Grove’s uncle, a journalist, and the newspaper began rejecting the young Grove’s articles.

” A career in journalism suddenly lost its appeal,” Grove wrote in Swimming Across.

The title of the book is a reference to a story that one of Grove’s physics teachers told. He said to parents that life was like a lake and that all of their children were trying to swim across. “Not all of them will swim across. But one of them, I’m sure, will. That one is Grof.”

Grove was 20 years old when he decided to flee across the Iron Curtain to Austria. He said he had to crawl through mud to cross the border. He then made an elaborate trek across the country with another friend. A farmer guided them to the Austrian border, for a fee. In 1957, he made his way to the United States and he changed his name to Andrew S. Grove. He was had $20 in his pocket.

His luck was turning. Rescue groups and other immigrants took care of him. He met his future wife, Eva Kastan, at a summer resort and married her in 1958. He studied chemical engineering at the City College of New York, a school that he donated more than $26 million to after he retired. He got his doctorate at the University of California at Berkeley in 1963, and that placed him in one of the key places in the world at the dawn of electronics.

In 1963, Gordon Moore hired Grove as a researcher at Fairchild Semiconductor, which he and Noyce had started after they (along with the rest of the Traitorous Eight) left Shockley Semiconductor. At Fairchild, Grove rose to assistant head of research and development under Moore. When Noyce and Moore left Fairchild to found Intel in 1968, Grove was their first hire. Noyce was a natural leader and a great technologist, but he wasn’t a taskmaster. Grove was hired to keep order.

He instituted disciplined, military-style behavior, such as a “late list” for anyone arriving after the designated start time. But he ran the company in an egalitarian way, and he had a normal-size cubicle for his office. Such practices became normal in Silicon Valley, where it was often easy for employees to go down the street to get a new job.

Above: Intel’s original Pentium chip.

Image Credit: Pauli Rautakorpl/ Flickr Creative Commons

Intel pioneered chips such as the dynamic random access memory (DRAM), which is still used as the main memory in personal computers and other devices today. But in the 1970s, the Japanese were “dumping” memory chips at below-cost prices in order to drive rivals out of the market. In a famous strategic retreat, Grove had a conversation with Moore. They asked each other what would happen if a new CEO took the helm at Intel. The answer was obvious. Intel would exit the DRAM business. So Grove said he suggested the unthinkable, “Why don’t we do that ourselves?” Intel did exactly that and refocused on its fledgling microprocessor business. That turned out to be one of the best business decisions of all time.

Grove’s decisions inspired books such as Clayton Christensen’s The Innovator’s Dilemma, which points out how rare it is for a company to decide to disrupt its own business by shelving a product it has pioneered. Grove was thinking offensively, seeking to disrupt Intel’s business before someone else did it. He worried about things like discerning “signals from noise” and looking for those special moments that were “strategic inflection points,” when something big changed and the trends were truly turning in another direction.

Intel had a fractious history under Grove’s leadership. He sparred with Advanced Micro Devices CEO Jerry Sanders over the rights to the x86 architecture, which became the basis for the microprocessors that were the brains of the personal computer. Intel beat out Motorola to become the supplier of processors for the IBM PC. During Grove’s tenure, Intel grew its annual revenues from $1.9 billion to more than $26 billion, but the company was also accused of anti-competitive behavior.

That led to an eight-year feud with AMD over legal rights to the microprocessor. Grove called AMD’s copycat tactics “the Milli Vanilli of semiconductors” after the lip-syncing rock duo.When Grove’s successor, Craig Barrett, settled that lawsuit, it was like the end of Silicon Valley’s equivalent of the Cold War.

Under Grove, Intel pulled away from the competition, beating out dozens of companies that made microprocessors. In 1994, Intel launched its Pentium processor, which helped seal its dominance. But Grove had a blind spot, as became evident when a math professor found a flaw in the Pentium. He approached the onset of that problem as a scientist would, noting it was a very rare bug that an average spreadsheet user might encounter once in every 27,000 years. Since it had been pointed out, it was something which could be avoided.

Above: Andy Grove, former CEO of Intel

Image Credit: Steve Jurvetson/Flickr Creative Commons

“In other words, if you know where a meteor will land, you can go there and get hit,” Grove complained about the Pentium’s detractors.

But Intel hadn’t realized that its powerful Intel Inside campaign had made everyday users aware that it had created the Pentium, and that Intel was ultimately responsible for a flaw in the device. The joke of the day: “What’s another name for the Intel Inside sticker they put on Pentium-based computers? A warning label.” After IBM said it would stop selling the chips, Intel had to recall the flawed Pentiums and replace them at a cost of up to $475 million. Grove apologized.

“In a sense, this is a moment in Intel’s history as we evolve into a consumer technology company, ” Grove said in an interview with me. “I wish the lesson was a little less painful for us and everyone else involved.”

I remember interviewing Grove about the Pentium bug while I was a reporter at the San Jose Mercury News. He was very intense, direct, and smart in the way that he answered questions. He had a legendary temper, sometimes taking off his hearing aid to indicate that a meeting was over. But he was perfectly fine with having employees yelling back at him. Grove called this “creative confrontation.” In 1984, Fortune named Grove one of the nation’s toughest bosses.

“I worry about products getting screwed up, and I worry about products getting introduced prematurely,” Grove wrote in Only the Paranoid Survive. “I worry about factories not performing well, and I worry about having too many factories. I worry about hiring the right people, and I worry about morale slacking off. And, of course, I worry about competitors.”

Grove had a huge impact on those around him. One of his admirers was Renee James, whom I interviewed many years ago when she was Grove’s “technical assistant.” She helped him do his PowerPoint slides for his speeches, but grew into a role as an advisor and executive assistant. She told me that she heard Grove say so many wise things that she would write them down at night. She became a close confidant and was named chief of staff. She eventually rose to become president of Intel.

Grove was polite during our interactions over the years. He respected me as a journalist, but he often probed me for opinions on difficult matters. As a journalist, trained to be a neutral observer, I had a hard time with this. But he always made me think, and I always tried hard to come up with good questions when I met with him. And I’ll say this now. He was brilliant, and I’ll miss his candor.

While at the San Jose Mercury News, I had this interchange with him:

Q What should companies do?
A What we are doing collectively is hiding from our world and theirs, the uninsured. Nobody challenged my information about the growth of the problem. Let’s assume for the moment I’m right. What’s the AR?

Q What?

A Oh my god. You’ve been covering Intel for how long and you don’t know what AR stands for?
Q What?

A Action required. An Intel acronym. The first action item goes to you guys. I reach 200 people. If you keep repeating it, and rub our world’s nose into it, you will have moved the ball forward. An increasing number of people will be terribly uncomfortable that we know what is happening and we talk around the issue as if it didn’t exist. That is how far I have gone.

As he had grandchildren, he softened. He came to view his role as a statesman of the industry. He created Intel Architecture Labs as he realized that his company — one of the most profitable parts of the PC food chain — was unique in the industry in having the funds to invest in fundamental research. Intel took on a role as a technology leader, rather than just a component supplier, during Grove’s rein.

In a mea culpa, Grove wrote about the Pentium bug experience in Only the Paranoid Survive, which I consider to be one of the top 25 technology books of all time. Yet Intel never held Grove personally responsible for that problem. Under Grove, Intel saw a 4,500 percent increase in its market value, and it grew to more than 64,000 employees.

“[Grove] approached corporate strategy and leadership in ways that continue to influence prominent thinkers and companies around the world,” said Intel chairman Andy Bryant, in a statement. “He combined the analytic approach of a scientist with an ability to engage others in honest and deep conversation, which sustained Intel’s success over a period that saw the rise of the personal computer, the Internet, and Silicon Valley.”

Grove and his wife, Eva, were married for 58 years and had two daughters and eight grandchildren. In his later years, he suffered from Parkinson’s Disease. In his second career, he became a health and patient advocate, arguing that the state of healthcare was a “goddamn, horrible thing.”

Asked about whether his advocacy would be good for Intel, Grove said to me, “Am I self-serving? I’m self-serving on my behalf and your behalf and everybody’s behalf because I don’t want to live in a country that is at the end of this if we don’t act. If your next question is, ‘Why is this a good business for Intel?’ I have no idea. I don’t know if it is. The alternative will be bad. What I am trying to do is say, ‘Let’s stop arguing what we would like the weather to be the day after tomorrow.’ Let’s act on something that is pretty close to a fact and do something about it before it gets worse.”

As for his fame, Grove said to me in 2006, “A book of 500 pages written about me is kind of an awkward deal. I found it embarrassing to talk about and interesting to read. I agree with the perspective on most things. I disagree with some of them. I find myself arguing with pages here and there. I will not tell you what they are.”

Grove was active in philanthropy and public policy issues during his retirement. Diagnosed with prostate cancer, he authored a 1996 cover story in Fortune that explained his decision to undergo an unconventional, but ultimately successful, radiation treatment.

I remember watching Grove debate George Gilder, an author and conservative philosopher, about the value of government. Grove pointed out that the U.S. space program was responsible for the advances in semiconductors in the 1950s and 1960s, making it possible to do the necessary research that eventually turned chips into a successful commercial industry.

During that debate, Grove mentioned that he didn’t think biotechnology would become bigger than electronics. Grove said, “I’ll be dead by then.”

Futurist Paul Saffo replied, “Not if biotechnology works.”

Above: Andy Grove (left) and Gordon Moore in 2013.

Image Credit: Dean Takahashi

Grove contributed to Parkinson’s research and urged the medical community to more efficiently study the disease. Like Noyce before him, he constantly worried about the competitiveness of the U.S. against rivals such as Japanese chip manufacturers. That threat was contained, as Japan’s economy weakened, and Intel went on to become the standard-bearer of the PC, alongside Microsoft. But Grove had an up-and-down relationship with Bill Gates, then-CEO of Microsoft.

Grove also urged America to be mindful of its competitiveness.

“Since the early days of Silicon Valley, the money invested in companies has increased dramatically, only to produce fewer jobs,” Grove wrote, back in 2010. “Simply put, the U.S. has become wildly inefficient at creating American tech jobs.”

He worried that if the scaling up of technologies such as batteries takes place overseas, the U.S. would lose not just jobs but its ability to participate at all.

Grove wrote further, “Should we wait and not act on the basis of early indicators? I think that would be a tragic mistake because the only chance we have to reverse the deterioration is if we act early and decisively.”

The last time I saw Grove was in January 2013, when PBS premiered its documentary on the history of Silicon Valley. That event was like a reunion of all the “Fairchildren” and pioneers at Intel. Grove’s hands were shaking from Parkinson’s, and he was hard of hearing. I introduced myself, and I don’t know if Grove recognized me or not.

In his memoir, Swimming Across, Grove concluded, “I am still swimming.” The New York Times closed out its obituary of Grove with this funny quote.

“I’ve had a wonderful life,” he told Wired in a lengthy 2001 interview. “What people are going to write about me 10 years after I’m dead — who cares?”