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

Etched, a rising competitor to Nvidia, made headlines this week by announcing that TSMC successfully produced its inaugural chip earlier this year. The four-year-old startup, currently valued at an impressive $5 billion, is gearing up to deliver systems powered by this chip to clients later this summer. However, scaling up production could present challenges, as Etched, like many chip designers, must vie for the limited manufacturing capacity at TSMC’s facilities in Taiwan. Copper Sky Capital, one of Etched's early backers, remains optimistic that the semiconductor manufacturer will overcome these production hurdles, with hopes of eventually moving chip fabrication to TSMC's facility in Arizona. When Copper Sky participated in Etched's $120 million Series A funding round two years ago, founder Jack Selby negotiated his investment partly by pledging to assist the startup in reshoring its chip production to Arizona. Selby, a former executive at PayPal and a longstanding managing director at Peter Thiel’s family office, Thiel Capital, launched Copper Sky in Phoenix in 2021, previously known as AZ-VC. The firm’s first fund, totaling $115 million, primarily targeted startups situated in Arizona and the Southwest. Selby believes that many coastal startups, particularly those in California, Massachusetts, and New York, are significantly overpriced compared to emerging companies in his region. He aims to facilitate a shift where California-based hardware startups can relocate their production operations to Arizona. Selby attributes Copper Sky’s investment in Etched—an otherwise elusive startup—to his influential role in bolstering Arizona’s economic landscape. As a board member of the Arizona Commerce Authority, he plays an active role in enticing out-of-state companies to establish manufacturing bases in the area. "When Copper Sky invested in Etched, the company recognized our connections to the Arizona semiconductor industry, especially the local TSMC GIGAFAB," Selby told TechCrunch. Recently, Copper Sky has broadened its investment strategy to include non-traditional venture hubs across the nation. Selby indicated that the firm is keen on supporting hardware companies, including those in the defense sector, that can set up manufacturing in Arizona. With plans to raise a second fund of $300 million, Copper Sky is preparing to invest in higher-valued coastal companies and others throughout the United States.