Acquired
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TSMC (Remastered)

January 21, 2025

AI Summary

5 min read

TSMC: The Quiet Superpower Behind the World's Chips

In 1985, a 56-year-old former Texas Instruments executive named Morris Chang moved to Taiwan to run a government research institute. He thought it was a cushy retirement gig. Instead, the Taiwanese government told him to start a semiconductor company and make it a world leader. He had three days to write the business plan. He had no equity in the company. And he was told it was an offer he couldn't refuse. That company, Taiwan Semiconductor Manufacturing Company, is now the ninth most valuable company in the world, with a market cap over a trillion dollars.

The Founder Who Couldn't Catch a Break

Morris Chang's path to founding TSMC was anything but linear. Born in Ningbo, China in 1931, he fled three wars before turning 18: the Second Sino-Japanese War, World War II, and the Chinese Civil War. He escaped to the United States, attended Harvard for a year, then transferred to MIT to study mechanical engineering. After failing his PhD qualifying exams twice, he took a job at Sylvania's semiconductor division—for $480 a month, one dollar more than Ford offered.

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What you'll learn

  • 1 (00:00) **Episode Introduction & Remaster Context** - Hosts explain why they are re-releasing this 2021 episode: TSMC has doubled in market cap to over $1 trillion and become the manufacturing superpower behind the AI wave.
  • 2 (02:31) **Episode Setup & Morris Chang's Early Life** - Hosts introduce TSMC as a classic "most people have never heard of it, but it's the ninth largest company in the world" episode.
  • 3 (07:57) **From Harvard to MIT to Sylvania** - Chang transfers from Harvard to MIT for mechanical engineering, then fails his PhD qualifying exams twice.
  • 4 (23:58) **Rise at Texas Instruments & The Learning Curve** - Chang joins TI in 1958, the same year the integrated circuit is invented.
  • 5 (36:23) **Setback at TI and a New Path** - Chang is passed over for CEO and demoted to head of "quality and people effectiveness" after failing to turn around the consumer products division.
  • 6 (54:16) **The Founding of TSMC** - The Taiwanese government orders Chang to start a semiconductor company; he creates the "pure play foundry" model in three days.
  • 7 (74:06) **The Fabless Flywheel & The Rise to Dominance** - TSMC survives on "dregs" from IDMs until fabless startups like Qualcomm, Broadcom, and Nvidia become its core customers.

+ Full timestamped outline available in the app

Guests on this episode

Morris Chang

Show Notes

We dive into the unbelievable and unlikely history behind the quietest technology giant of them all: the Taiwan Semiconductor Manufacturing Company. Founded in 1987 by the then-56 year old Morris Chang, already a legend in the semiconductor industry by virtue of his meteoric rise and fall at Texas Instruments, TSMC today manufactures nearly all the leading-edge chips for Nvidia, Apple, Broadcom, Qualcomm, AMD, and yes — even Intel. Tune in for an incredible story of innovation, perseverance and lasers. Lots and lots of lasers!

Note: this is a remastered version of our original 2021 episode. We don’t often re-release old episodes, but in this case we have a very timely reason for doing so. Stay tuned! :)

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‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

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