Copper Sky Capital, one of Etched early investors, is hopeful that the chip maker will find a solution to its manufacturing constraints by eventually producing chips at Arizona’s TSMC facility. When the four-year-old VC 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 eventually reshore its chip fabrication to Arizona.
Selby, a former PayPal exec and longtime managing director to Peter Thiel’s family office, Thiel Capital, founded Phoenix-based Copper Sky in 2021 (formerly known as AZ-VC). The firm’s first $115 million fund 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 popping up in his 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 credits Copper Sky’s investment in Etched — an otherwise hard-to-access startup — to his influential role in Arizona’s economy. As a board member of the Arizona Commerce Authority, Selby is deeply involved in recruiting out-of-state businesses to set up manufacturing operations in the region.
“When Copper Sky invested with 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 hubs nationwide, Selby said that the firm is also interested in backing hardware companies, including in the defense sector, that can set up manufacturing operations in Arizona.
The firm is expected to soon have more capital to invest in those higher-priced coastal companies, and those throughout the United States. Copper Sky is currently raising a $300 million second fund, according to a regulatory filing.
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Marina Temkin is a venture capital and startups reporter at TechCrunch. Prior to joining TechCrunch, she wrote about VC for PitchBook and Venture Capital Journal. Earlier in her career, Marina was a financial analyst and earned a CFA charterholder designation.
You can contact or verify outreach from Marina by emailing marina.temkin@techcrunch.com or via encrypted message at +1 347-683-3909 on Signal.
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