The ENTIRE History of TSMC in 10 Minutes — Transcript

Full transcript

1. 0:00Quick question. What do the iPhone in
2. 0:02your pocket, the graphics card in your
3. 0:04gaming PC, and the AI chatbot doing your
4. 0:06homework all have in common? They all
5. 0:09run on chips made by the same company.
6. 0:11And no, it's not Apple. It's not Nvidia
7. 0:14either. It's a company most people can't
8. 0:16even pronounce correctly, TSMC.
9. 0:19Here's the crazy part. One company on
10. 0:22one small island makes the vast majority
11. 0:24of the world's most advanced chips. If
12. 0:26it stopped tomorrow, phones, cars, AI,
13. 0:30basically modern life would just buffer
14. 0:32forever. So, how did a company nobody
15. 0:35talks about become the most important
16. 0:37factory on Earth? Let's find out. This
17. 0:40is the entire history of TSMC. To
18. 0:42understand TSMC, we need to meet one guy
19. 0:45first, Morris Chang. He was born in
20. 0:48China in 1931, and his childhood was
21. 0:51basically one giant plot twist. War
22. 0:54everywhere, his family constantly on the
23. 0:56move, and eventually he ended up in the
24. 0:58United States for college.
25. 1:00He started at Harvard, then switched to
26. 1:02MIT because apparently one elite
27. 1:04university wasn't enough pressure. In
28. 1:061958, he joined Texas Instruments, one
29. 1:09of the original chip giants, and he was
30. 1:11cracked at it. He climbed all the way up
31. 1:14to running the company's entire
32. 1:15semiconductor business.
33. 1:17His specialty was getting factories to
34. 1:19make better chips with fewer duds.
35. 1:21Remember that because it's about to
36. 1:22matter a lot. But when the top job
37. 1:25opened up, the company gave it to
38. 1:26someone else. Chang got passed over.
39. 1:29Classic corporate move. He left in 1983,
40. 1:32and for a minute he was just a very
41. 1:34talented guy with no clear next step.
42. 1:37Meanwhile, on the other side of the
43. 1:38world, Taiwan had a problem. In the
44. 1:411980s, it was known for cheap
45. 1:42electronics and knockoff toys, and the
46. 1:45government wanted a real, world-class
47. 1:47chip industry. So, an official named
48. 1:49K.T. Li called Morris Chang and
49. 1:52basically said, "Come home and help us
50. 1:54build it."
51. 1:55In 1985, Chang, already in his 50s,
52. 1:58moved to Taiwan. Now, think about this
53. 2:01setup. No giant tech companies, no
54. 2:03famous chip designers, not much money.
55. 2:06Honestly, not giving future tech
56. 2:08capital. So, how do you build a chip
57. 2:11empire from there? Chang had an idea,
58. 2:13and it was kind of unhinged. Back then,
59. 2:15every serious chip company did
60. 2:17everything itself. Design the chip,
61. 2:19build it in your own factory, sell it.
62. 2:22Intel did it. Texas Instruments did it.
63. 2:24Everybody did it. And a chip factory,
64. 2:27called a fab, costs billions, so only
65. 2:29giants could even play. So, Chang asked
66. 2:32a simple question. What if a company
67. 2:34only manufactured chips and never
68. 2:36designed a single one?
69. 2:38Think of a kitchen that cooks anybody's
70. 2:40recipe, but never opens its own
71. 2:41restaurant to compete with you. Why
72. 2:43would that work? Because plenty of smart
73. 2:45engineers had brilliant chip designs,
74. 2:47but zero money for a factory. They'd
75. 2:50happily pay someone else to build them.
76. 2:52These became known as fabless companies,
77. 2:55and nobody had built a business around
78. 2:56serving them yet. In 1987, TSMC was
79. 3:00born. Taiwan Semiconductor Manufacturing
80. 3:03Company. The Taiwanese government put in
81. 3:06roughly half the money, the Dutch giant
82. 3:08Philips added cash and technology, and
83. 3:10Chang became chairman at 55 years old.
84. 3:1355? Most people are planning retirement
85. 3:16at that age. This man was starting the
86. 3:18most important company on Earth, and he
87. 3:20set one rule that everything else is
88. 3:22built on. TSMC would never compete with
89. 3:25its customers, never design its own
90. 3:27chips. Your secrets are safe with us.
91. 3:30We're just the kitchen. In an industry
92. 3:32full of backstabbing, being the
93. 3:34Switzerland of chips was low-key genius.
94. 3:37Was it an instant success? Absolutely
95. 3:40not. Early on, TSMC's technology was
96. 3:43behind the big names, and major
97. 3:45companies weren't exactly lining up to
98. 3:46hand their most valuable designs to a
99. 3:48brand new factory in Taiwan.
100. 3:50The early years were a grind. but then
101. 3:53the fabulous wave kicked in. Companies
102. 3:55like Qualcomm, Broadcom, and a little
103. 3:58startup from 1993 called Nvidia had no
104. 4:01factories at all, just ideas and
105. 4:03ambition. TSMC became the place that
106. 4:06turned those ideas into real chips.
107. 4:08Remember that name, Nvidia. It's coming
108. 4:11back later, and it's a big one. The
109. 4:13company went public in Taiwan in 1994,
110. 4:16then listed in New York in 1997, and the
111. 4:19culture inside was intense. Engineers
112. 4:21worked absurd hours, always on call, and
113. 4:24Taiwan's tech workers even have a joke
114. 4:26for it. They call it burning your liver.
115. 4:29Very healthy.
116. 4:30Great work-life balance. 10 out of 10.
117. 4:33Now, here's one of my favorite moments
118. 4:35in the whole story.
119. 4:36Early 2000s, to make chips smaller and
120. 4:39faster, you have to print insanely tiny
121. 4:41circuits using light, and the light
122. 4:43everyone was using was hitting its
123. 4:45limit.
124. 4:46The industry's big plan was to switch to
125. 4:48a new super expensive type of light that
126. 4:50nobody had really figured out. Then a
127. 4:53TSMC engineer named Burn Lin said,
128. 4:55"Wait, what if we just put water between
129. 4:58the lens and the chip? Water bends
130. 5:00light, so it lets you print finer lines
131. 5:02with the tools you already have." Some
132. 5:04big players thought it sounded
133. 5:05ridiculous, but the Dutch company ASML
134. 5:08built machines around the idea. TSMC
135. 5:11went all in, and it worked. Water. A
136. 5:14multi-billion-dollar problem solved with
137. 5:17water. That bet helped TSMC pull ahead
138. 5:20and turned ASML into the machine maker
139. 5:22the whole chip world depends on.
140. 5:24Sometimes the genius move is the one
141. 5:26everyone laughs at first. And if you're
142. 5:28liking this story so far, subscribe to
143. 5:31CEO Zone so you never get left on red by
144. 5:33the next company's origin story.
145. 5:36But it wasn't all smooth. Chang stepped
146. 5:38down as CEO in 2005, and then the 2008
147. 5:41financial crisis hit. Orders dried up,
148. 5:44factories sat half empty, and TSMC was
149. 5:46in trouble. So, in 2009, the founder
150. 5:49came back to take the wheel himself. The
151. 5:51same guy who got passed over at Texas
152. 5:53Instruments, now saving his own company.
153. 5:55Main character energy. Okay, now the
154. 5:58iPhone era.
155. 5:59When the first iPhone dropped in 2007,
156. 6:02Apple's chips were made by Samsung,
157. 6:04which sounds fine until Apple and
158. 6:06Samsung started suing each other over
159. 6:08smartphones. Imagine your chip supplier
160. 6:11is also your biggest rival. Awkward. So,
161. 6:14Apple looked around and asked, "Who will
162. 6:16never ever compete with us?" And the
163. 6:18answer was sitting right there, TSMC.
164. 6:22Starting around 2014, TSMC began making
165. 6:25chips for the iPhone, and within a few
166. 6:27years it was producing basically all of
167. 6:29them. TSMC spent billions on dedicated
168. 6:31capacity, a giant bet on a single
169. 6:34customer, and it paid off massively.
170. 6:36Meanwhile, remember Intel? For decades,
171. 6:39Intel was the final boss of chips. But,
172. 6:42Intel hit delays on its newer technology
173. 6:44while TSMC kept hitting one deadline
174. 6:47after another. Somewhere in the late
175. 6:492010s, the student quietly passed the
176. 6:51teacher. The kitchen became better than
177. 6:53the restaurants. So, why can't anyone
178. 6:55just copy TSMC?
179. 6:57Great question. First, money. A
180. 6:59cutting-edge fab can cost tens of
181. 7:01billions of dollars. Second, know-how.
182. 7:04Making the newest chips takes decades of
183. 7:06tiny improvements, thousands of
184. 7:08engineers, and a ridiculous amount of
185. 7:10trial and error that you can't just buy.
186. 7:12And third, trust. The biggest tech
187. 7:15companies design their chips around
188. 7:16TSMC's process. So, switching away is
189. 7:19like moving to a new country and
190. 7:21learning a new language. Samsung and
191. 7:23Intel are trying hard, but catching up
192. 7:25here is brutal. Even when a huge
193. 7:27earthquake hit Taiwan in 2024, TSMC got
194. 7:30most of its production back within days.
195. 7:33That's the kind of reliability customers
196. 7:35pay for. In 2018, Morris Chang finally
197. 7:38retired. At 86, 86. Not bad for a guy
198. 7:42who started TSMC in his 50s after
199. 7:44getting passed over for a promotion. The
200. 7:46company he left behind is now run by
201. 7:48C.C. Wei. Then 2020 happens. The
202. 7:51pandemic hits, everyone stuck at home,
203. 7:53and suddenly the world wants laptops,
204. 7:55consoles, and new cars all at once. Chip
205. 7:58supply can't keep up. Car factories
206. 8:00literally stopped production because
207. 8:02they couldn't get chips. You couldn't
208. 8:04find a PlayStation 5 anywhere. And
209. 8:06that's when regular people finally
210. 8:08asked, "Wait, who actually makes all of
211. 8:10these?" The answer was, "Mostly Taiwan.
212. 8:14Mostly TSMC." And governments everywhere
213. 8:17kind of panicked. Because here's the
214. 8:18uncomfortable part. Taiwan is a
215. 8:20self-governing island that China claims
216. 8:22as its own. So, the world's most
217. 8:24important chip supply sits in one of the
218. 8:26most tense spots on the map. People call
219. 8:28it the silicon shield. The idea that the
220. 8:30world needs those chips so much that
221. 8:32nobody can afford a conflict there.
222. 8:34Experts argue about whether that really
223. 8:36works, but it shows how high the stakes
224. 8:38are.
225. 8:39Chips stopped being just products. They
226. 8:41became power. So, TSMC started spreading
227. 8:44out. A huge investment in Arizona, which
228. 8:47now runs to well over a hundred billion
229. 8:49dollars in plans. A factory in Japan
230. 8:51with partners like Sony and Denso, and
231. 8:53another in Germany. It's expensive and
232. 8:56messy with different workers, different
233. 8:58rules, and some culture clash with that
234. 9:00famous work ethic. But, the message is
235. 9:02clear.
236. 9:03Don't put all the chips in one basket.
237. 9:05And then, plot twist number 100, ChatGPT
238. 9:08arrives in late 2022 and the AI boom
239. 9:11explodes. What does AI need? Insanely
240. 9:14powerful chips. Who designs most of
241. 9:16them? Nvidia. Remember that little
242. 9:19startup from earlier? Now one of the
243. 9:21biggest companies on the planet. And who
244. 9:23makes those chips? You guessed it. TSMC.
245. 9:26Today, Nvidia, Apple, AMD, Google,
246. 9:30Amazon, basically every big name in tech
247. 9:32is standing in line outside TSMC's door
248. 9:35begging for production space. TSMC is
249. 9:38rolling out its newest 2-nanometer
250. 9:40chips, and its sales are still hitting
251. 9:42records with revenue this year up around
252. 9:4440% compared to last year. Its market
253. 9:46value is well past a trillion dollars.
254. 9:49The quiet kitchen in the back became the
255. 9:50most important kitchen in the world. So,
256. 9:53that's the whole story. A guy who got
257. 9:55passed over for a promotion, a
258. 9:57government with a wild idea, one rule
259. 9:59about never competing with your
260. 10:00customers, and a lot of engineers
261. 10:02burning their livers. And that guy who
262. 10:04got passed over, he ended up building
263. 10:07the company that every CEO on Earth
264. 10:09depends on. Next time you pick up your
265. 10:11phone, remember it probably came from
266. 10:13one island and one company most people
267. 10:15never think about. Crazy, right? Anyway,
268. 10:18if you want another company's origin
269. 10:20story, check the next video on your
270. 10:22screen. See you there.