Thiel Capital’s Jack Selby nabs stakes in hot startups like Etched through Arizona connections

Etched, a ~$5B-valued four-year-old chip startup, said TSMC manufactured its first chip earlier this year and the company plans to ship systems powered by it later this summer, though ramping production may be constrained by limited TSMC Taiwan capacity. Copper Sky Capital— which backed Etched’s $120M Series A— is hopeful Etched can eventually reshore fabrication to TSMC’s Arizona facility, aligning with Copper Sky’s current focus and planned expansion of its $300M second fund.

Analysis

The market-relevant signal is not the startup’s launch cadence; it is that advanced-node supply remains gatekept by TSMC. That keeps NVDA’s competitive moat intact over the next 1-3 quarters because most ASIC challengers fail at capacity allocation, yield, and packaging before they ever pressure incumbent shipments or pricing.

The second-order winner is TSM, not because Arizona is suddenly a major P&L driver, but because strategic customers will pay up for optionality and political diversification. That should support utilization and customer stickiness over 6-18 months, while the near-term risk is that investors overestimate how quickly U.S. fab localization can be converted into meaningful revenue or margin expansion.

Contrarian view: consensus is likely reading this as a broad AI-competition story, but the real constraint is manufacturing throughput, which favors incumbents. The move would be overdone if the market starts shorting NVDA on every ASIC headline; the thesis is falsified only if we see repeatable shipment volumes, multi-quarter wafer commitments, and a proven path to scaled production rather than a one-off tapeout.

Key Decisions for Investors

• Long TSM on any 1-2 day post-news pullback; use a 3-6 month horizon and prefer call spreads over outright stock if you want defined risk. Upside comes from scarcity pricing and strategic customer lock-in; invalidate if TSM guides to slower U.S. ramp or margin dilution from Arizona capex.
• Do not short NVDA on this headline. Treat it as a watch item only; revisit the bear case if an AI-ASIC challenger shows actual multi-quarter shipment data or customer migration over the next 1-2 quarters.
• Relative-value: long TSM / short SOXX for 1-3 months if the market starts rewarding supply-chain scarcity over speculative AI competition. This works if TSM rerates on capacity control while the broader semiconductor complex compresses on crowded positioning.