Jack Selby Leverages Arizona Ties to Back AI Startup Etched

Jack Selby, the veteran investor behind Copper Sky Capital, has successfully secured an investment stake in the high-profile AI startup Etched. The move, which grants the firm access to a company currently valued at $5 billion, is rooted in Selby’s strategic efforts to connect California-based hardware developers with the burgeoning semiconductor manufacturing ecosystem in Arizona.

Etched recently confirmed that its first chip was manufactured by TSMC earlier this year. As the startup prepares to ship systems to customers later this summer, it faces the industry-wide hurdle of securing sufficient production capacity at TSMC’s Taiwan facilities. For Copper Sky, the investment is part of a long-term vision to mitigate these constraints by eventually transitioning fabrication processes to the TSMC site in Arizona.

Building an Arizona Semiconductor Bridge

Selby, a former PayPal executive and long-time managing director at Peter Thiel’s family office, Thiel Capital, established the Phoenix-based Copper Sky (formerly AZ-VC) in 2021. His initial $115 million fund focused on the Southwest, driven by the belief that startups in California, New York, and Massachusetts were often overvalued compared to regional alternatives. However, his strategy has evolved to facilitate a flow of resources in the opposite direction.

“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 stated regarding the Series A investment, which totaled $120 million two years ago.

Selby’s influence is bolstered by his position as a board member of the Arizona Commerce Authority. This role places him at the center of efforts to recruit out-of-state enterprises to establish manufacturing footprints within the state.

Expansion and Future Outlook

While Copper Sky’s origins are tied to the Southwest, the firm is broadening its mandate to include hardware companies across the United States, with a specific interest in the defense sector. The goal remains to identify firms capable of leveraging Arizona’s expanding manufacturing infrastructure.

The firm is currently positioning itself for larger commitments, with a regulatory filing indicating that Copper Sky is in the process of raising a second fund totaling $300 million. This additional capital is expected to support a wider array of high-value coastal companies as they navigate the complexities of hardware production.