American small startup company Substrate announced on Tuesday that they have developed a chip manufacturing tool that rivals the most advanced lithography equipment produced by the Dutch company ASML.
CEO of Substrate, James Proud, told Reuters that this tool is the first step in the company’s ambitious plan to establish a chip foundry in the United States to compete with Taiwan Semiconductor Manufacturing Company (TSMC) in manufacturing cutting-edge artificial intelligence chips. Proud hopes to significantly reduce chip manufacturing costs by producing the necessary tools at a much lower cost compared to competitors.
If successful, the company’s endeavor will have a significant impact on the economy and national security. President Trump has made bringing chip manufacturing back to the U.S. a key part of his agenda. The U.S. government recently invested in Intel, a once-leading chip manufacturer that has struggled to keep up with TSMC in the manufacturing field.
Substrate has attracted support from non-profit venture capital firm In-Q-Tel backed by the Central Intelligence Agency (CIA), as well as several private venture capital firms like Founders Fund, General Catalyst, Long Journey Ventures, and Valor Equity Partners, along with investment bank Allen & Co, raising $100 million with a valuation exceeding $1 billion.
However, achieving its goals will not be easy for the San Francisco-based company.
This is a massive engineering feat that even large companies struggle to achieve – lithography technology requires extremely high precision. ASML is the only company globally capable of mass producing this complex equipment, which uses extreme ultraviolet light (EUV) to rapidly create patterns on silicon wafers.
General Catalyst managing director Paul Kwan stated, “At some point, everyone just gave up trying to solve the chip problem and resigned to the duopoly formed by TSMC and ASML.”
Substrate has developed a lithography technology using X-rays, with a feature resolution comparable to the most advanced chip manufacturing equipment made by ASML, each of which costs over $400 million.
The company has demonstrated its technology at U.S. national laboratories and its proprietary facility in San Francisco, providing high-resolution images to showcase the performance of Substrate’s equipment. However, independent verification of the company’s claims regarding its technology is currently unavailable.
“This is an opportunity for the United States to reclaim this market through domestic companies,” said Stephen Streiffer, director of Oak Ridge National Laboratory and expert in high-energy X-ray beams, in an interview. “This work is extremely important for the country, and they know what they are doing.”
Substrate is a Silicon Valley-based semiconductor startup founded in 2022, focusing on developing advanced lithography technology using high-energy X-rays to challenge the market domination of TSMC and ASML. The company has conducted technical demonstrations at U.S. national laboratories and its facilities, attracting investments from various venture capital firms, including In-Q-Tel supported by the CIA. Its innovative technology holds significant strategic importance for U.S. semiconductor sovereignty and national security.
Their website proudly states: “Putting America back at the forefront of semiconductor production.”
(Reference based on relevant reports by Reuters)