Engraved Nvidia Competitor announced This week TSMC had manufactured its first chip earlier this year. While the four-year-old, $5 billion startup is preparing to ship systems powered by that chip to customers later this summer, scaling production may prove challenging. Like other chip designers, Etched must compete for limited capacity at TSMC’s factories in Taiwan.
Copper Sky Capital, an early investor in Etched, is hopeful the chipmaker will find a solution to its manufacturing limitations by producing chips at TSMC’s Arizona facility. When the four-year-old venture capital firm invested in Etched’s $120 million Series A two years ago, founder Jack Selby secured an allocation in part by promising to help the startup relocate its chip manufacturing to Arizona.
Selby, a former PayPal executive and CEO of Peter Thiel’s family office, Thiel Capital, founded Phoenix-based Copper Sky in 2021 (previously known as AZ-VC). The first of the firm. Fund of 115 million dollars focused primarily on startups based in Arizona and the Southwest. Selby’s thesis was that most coastal startups, particularly those based in California, Massachusetts and New York, are grossly overpriced compared to companies emerging in their region. However, Selby saw an opportunity to bridge the gap in the other direction by helping California-based hardware startups move their production to Arizona.
Selby attributes Copper Sky’s investment in Etched, a hard-to-reach startup, to its influential role in Arizona’s economy. As a member of the board of directors of the Arizona Commerce AuthoritySelby is deeply involved in recruiting out-of-state companies to establish manufacturing operations in the region.
“When Copper Sky invested in Etched, the company clearly understood our connectivity to the Arizona semiconductor industry and, in particular, the local TSMC GIGAFAB,” Selby told TechCrunch.
While Copper Sky has recently expanded its focus beyond the Southwest to include non-traditional venture centers across the country, Selby said the company is also interested in supporting hardware companies, including in the defense sector, that can establish manufacturing operations in Arizona.
The company is expected to soon have more capital to invest in higher-priced coastal companies and those across the United States. Copper Sky is currently raising a second $300 million fund, according to a regulatory filing.
When you purchase through links in our articles, we may earn a small commission. This does not affect our editorial independence.
