TSMC sets up $500 million fund to back the chip ecosystem

Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, is setting up a dedicated investment company with up to $500 million to take strategic stakes across the semiconductor industry and its wider ecosystem.

The move was one of several resolutions passed by TSMC's board of directors and disclosed in a filing with the US Securities and Exchange Commission. The filing describes the new vehicle only as an investment company for strategic investments in the semiconductor industry and related ecosystem. TSMC has not yet named which companies it will target or explained how quickly it will deploy the money.

A step up from earlier venture activity

TSMC is no stranger to venture investing. Its VentureTech Alliance, founded in 2001, has backed early-stage chip startups from a fund of around $165 million, including Silicon Valley companies such as SiMa.ai, Ayar Labs and Ethernovia. The company has long courted young chip designers, saying it has supported close to 1,000 startup customers through access to its factories and design ecosystem.

At roughly three times the size of VentureTech's fund, the new vehicle points to a more ambitious approach: owning a piece of the companies that design, package and depend on its chips, rather than only manufacturing for them.

Bets on AI's biggest names

The same board meeting approved far larger single bets. TSMC will invest up to $500 million in Anthropic's common shares at the AI developer's IPO price, and up to $500 million in OpenAI's preferred stock. Anthropic's offering filing lists TSMC among the investors in a separate $26 billion private placement, alongside Google, Nvidia, AMD, Broadcom, Micron and Microsoft.

According to Seoul Economic Daily, citing Taiwanese media, the stakes are meant to deepen TSMC's computing alliances as both AI companies develop their own custom chips for running AI models. Taiwanese commentators see the equity ties as a way for TSMC to reduce its reliance on Nvidia, which accounts for a very large share of its revenue, and to gain more leverage over how scarce capacity is allocated and priced.

The shift is clear, given that the company built its reputation on neutrality, filling orders for chip designers without competing with or investing heavily in them.