Nvidia's Flat Structure Left No Heir as Huang Exits

By Daniel Okafor

Nvidia had no public succession plan when Jensen Huang resigned as CEO, president, and board member on Wednesday. The board named CFO Colette Kress interim CEO and opened a search that includes internal and external candidates. That structure, according to leadership advisors, tells you what the org chart hid: nobody was ready.

Huang built Nvidia into one of the world's most powerful companies while running it with as many as 60 direct reports. He cofounded the chip giant at a Denny's restaurant in the early 1990s and deliberately kept the top of the company flat. He credited that model with keeping information "fluid" and employees empowered.

Speed was the payoff. Depth was the cost. Advisors who work with boards on leadership transitions said the founder-centric structure left Nvidia exposed.

What does the flat model cost?

"It's hard to imagine any of those direct reports are able to get the scale, scope, and experience to even be qualified to be the CEO," said David Astorino, a senior partner at leadership consulting firm RHR International.

Astorino said Huang's outsize status created "key-person risk" — too much control resting with a single executive. The problem is particularly acute for Nvidia, he said, because of its central position in the AI ecosystem.

Dan Kaplan, managing partner and head of the HR practice at consulting firm ZRG, said founders resist succession planning for a psychological reason. After years of being told their ideas would fail, they learn to ignore doubters.

"They're not great at hearing no," Kaplan said. "They develop the thickest skin possible."

His verdict on the structure itself: "When you have a flat organization like this, it's great for speed. It's not great for developing leaders."

Nvidia did not respond to a request for comment from Business Insider.

How common is the gap?

Nvidia's succession crunch is not an outlier. A 2025 Nasdaq survey of about 700 board members, CEOs, executives, and governance professionals found 21% of boards had no CEO succession plan. Another 16% said they had only an emergency plan. Boards, in other words, often start planning only after the window to prepare has narrowed.

Huang's exit came amid reports of multiple extramarital affairs and a board investigation into concerns that he may have been the subject of a foreign intelligence effort.

Bradley Akubuiro, a partner at Bully Pulpit International and former Fortune 50 chief spokesperson, said the transition exposes a vulnerability common to founder-led companies: founders' identities become tied to the organization's success or failure.

Boards can mitigate the risk, he said, by adding an independent director, lead director, or chair who keeps succession planning on the agenda. The trigger for an unexpected exit need not be scandal. "It isn't always going to be misconduct," Akubuiro said. "Any number of things could happen."

A viable plan also takes more than a name on an org chart, he added. Successors need substantial operational experience, exposure to the board, and visibility with investors, customers, and other stakeholders.

Why do boards keep succession plans quiet?

Even careful boards stay silent, said Umesh Ramakrishnan, cofounder and chief strategy officer at executive search firm Kingsley Gate. Naming a successor publicly can turn the sitting CEO into a lame duck, prompt passed-over contenders to resign, and spark internal jockeying.

"The organization starts gravitating toward the successor because they know that's where the power center is going to be," Ramakrishnan said.

His advice: boards should begin planning well before a crisis, cultivating two or three serious internal candidates, giving them real operating responsibility, and creating incentives for them to stay through the transition.

Does Nvidia risk losing talent?

The leadership upheaval compounds a market problem. Nvidia's shares took a hit after the reports, and Lior Prosor, cofounder and managing partner at venture fund Deep33, said rivals now have a fresh opening to recruit its most valuable people.

Nvidia has been a "super sticky organization," Prosor said, partly because employees shared in the company's extraordinary stock run-up. That glue may be weakening.

"For the first time ever," employees may be asking, "How much will my equity be worth? How quickly does it come back?" Prosor said.

Alexander Kirss, a director analyst in Gartner's HR practice, said Nvidia's troubles offer a lesson for every company that has flattened its management layers.

"No employee is irreplaceable," he said. "That includes the CEO."

For boards across the tech sector, the takeaway is concrete: build the bench quietly, before the crisis forces the choice.