TSMC founder Morris Chang
Morris Chang reveals the $100M+ Nvidia settlement, the 2009 layoff crisis, and how TSMC’s 28nm bet on smartphones made the company.
- Chang personally settled the 40nm Nvidia dispute in 2009 with an offer exceeding $100M, given with a 48-hour accept-or-arbitrate ultimatum — the previous CEO had offered nothing.
- TSMC’s predecessor CEO laid off 600-700 employees via bottom-performance reviews in 2008; Chang opposed it as subjective and rehired them upon returning as CEO.
- Chang locked R&D spend at a fixed 8% of revenue — up from a negotiated 6-7% — so his R&D director never had to fight for budget again.
- Capital expenditure tripled to nearly $6B in 2010 to go all-in on 28nm, which Chang’s board strongly resisted; the bet paid off because 28nm coincided with the smartphone era.
- TSMC’s early years were largely serving IDMs’ excess/low-priority orders — fabless wasn’t yet a real market — but Chang deliberately built capacity waiting for fabless companies to emerge.
- Semiconductor market grew from $26B when TSMC was founded in 1987 to $527B; TSMC’s pure-play foundry model (never competing with customers) is what enabled trillion-dollar scale.
- TSMC, ARM, Synopsys, Cadence, and ASML were all founded within roughly two years of each other in the mid-to-late 1980s — the ecosystem is co-dependent and took decades to build.
- China subsidized solar so aggressively it destroyed TSMC’s solar-cell diversification attempt; LED failed separately due to patent lock-in by a few incumbents.
2025-01-27 · Watch on YouTube
