Let me try to explain it to you.
All or most network adapters have what we call PXE mode.
This is most commonly used on networks where for example the host computer does not contain a hard disk drive where the operating system is loaded from.
Instead when in PXE mode is set up on the network adapter it uses this to load the OS from a central server over the network. WinPE is what is used as the stored on the central server, and when a request to run it from a network device it runs or installs itself to the system requesting it loading the os to the system memory of the machine.
Ie: The first laptop.