Morris Chang

Ford Motor Company offered 479 dollars a month; Sylvania Semiconductor offered 480. Ford would not match, so Morris Chang went into semiconductors over a difference of one dollar.¹ Chang is the founder and former chairman and chief executive of Taiwan Semiconductor Manufacturing Company, known as TSMC, the world's largest dedicated semiconductor foundry. A foundry manufactures the physical chips other companies design, so TSMC builds processors for Apple, Nvidia, Qualcomm, and AMD without ever designing or selling a chip under its own brand. That model, established in 1987, made TSMC the manufacturing backbone of the global chip industry and is widely regarded as one of the most strategically important businesses on earth.

Background

Chang was born in 1931 in Ningbo, China, into an educated, upwardly striving family; his father, Chang Wei-kuan, worked as a finance official and bank manager. War defined his childhood: the Sino-Japanese War, the Second World War, and the Chinese Civil War pushed the family across Ningbo, Nanjing, Canton, Hong Kong, and Chongqing before it returned to Hong Kong in 1948. He wanted to be a novelist; his father redirected him, warning he would starve as a writer.²

In 1949 Chang enrolled at Harvard College, reportedly the only Chinese student among roughly 1,100 undergraduates. After a year he transferred to MIT, earning a bachelor's degree in mechanical engineering in 1952 and a master's in 1953, working as a copy typist to pay tuition. He failed his MIT PhD qualifying exam on his first attempt, later saying he simply had not studied hard enough.²

Getting started

From 1955 to 1958 Chang worked at Sylvania in Ipswich, Massachusetts, teaching himself semiconductor physics from textbooks nightly. In 1958, at 27, he joined Texas Instruments and was immediately assigned to a transistor-yield crisis, with TI's yield near zero against IBM's roughly five percent. Working long days, he diagnosed flawed process specifications and pushed yields past IBM's.¹ TI funded his PhD at Stanford, completed in electrical engineering in 1964. There he helped develop, with the Boston Consulting Group, a strategy of pricing ahead of the learning curve: setting prices below current cost to win volume and letting manufacturing experience pull real costs down.¹ He rose to vice president of TI's global semiconductor business in 1972.

Chang was sidelined at TI from 1977 after a consumer-products division he ran struggled, and he has suggested ethnic bias played a role.² He left in 1983 with no other job lined up, spent about a year as president of General Instrument, and departed over a mismatch of vision with its chief executive. In 1985 Taiwan's technology minister K.T. Li, who had noticed Chang's resignation announcement in the Wall Street Journal, recruited him to build Taiwan's semiconductor industry through the Industrial Technology Research Institute.²

What he built

Chang's founding insight inverted a perceived weakness. Taiwan had no chip-design capability or intellectual property, only some manufacturing capacity, so he proposed a company that would do only manufacturing and never compete with clients on design, serving all chip designers as neutral capacity. No precedent existed: every major chip company was vertically integrated, combining design with fabrication.

He founded TSMC in 1987 at 55, effectively as a government-backed venture. Philips invested about 58 million dollars for 27.6 percent, Taiwan's National Development Fund held roughly 48.3 percent, and total initial capital was around 220 million dollars. Chang received no founding equity, essentially a state-appointed executive.¹ He sought anchor customers from Intel, TI, Motorola, AMD, Panasonic, and Sony, and all declined. First-year revenue was about 4 million dollars against a projection near 15 to 16 million, and the venture was mocked.¹ A second loss year followed in 1990 before TSMC turned durably profitable from 1991, with Intel becoming its first major U.S. customer that year. The pure-foundry model underpins the fabless semiconductor industry, and TSMC today manufactures most of the world's most advanced logic chips.

How he operates

Chang describes his defining trait as a fighting spirit, forged by three career departures, from TI, General Instrument, and ITRI, before he founded TSMC at 55. He has said that after resigning three times he felt he had reached a point of no return and had to strengthen that spirit further.² His operating philosophy rests on strict non-competition with customers, a refusal to do in-house chip design, a yield and process obsession learned at TI, and the learning-curve pricing from his consulting days. A TI-era saying held that anyone not chewed out by Morris had not really been at TI. He built TSMC as the capital-intensive manufacturing layer beneath an entire industry of chip designers, years before that industry existed, and the instrument he built it with was a fabrication plant rather than a capital or contractual position; he held no founding equity in it at all.

Where things stand

Chang stepped down as chief executive in 2005, returned briefly as chairman and chief executive from 2009 to 2013 during a leadership crisis, and retired fully as chairman in June 2018, handing over to a dual-leadership structure under chairman Mark Liu and chief executive C.C. Wei. He holds no formal TSMC position but remains a revered figure in Taiwan and the global chip industry. Taiwan awarded him the Order of Propitious Clouds in 2018 and the Order of Dr. Sun Yat-sen in 2024. His net worth is estimated in the low billions, from a reported family stake of about 0.5 percent in TSMC. In January 2025 he gave a rare long-form English interview, his first in 17 years.

Key facts

• Chose his first job, Sylvania over Ford, because it paid one dollar a month more.
• Failed his MIT PhD qualifying exam, then built manufacturing science that anchored an industry.
• Founded TSMC in 1987 at age 55, after being pushed out of three organizations in the prior decade, with no personal equity.
• TSMC's first-year revenue missed projections by roughly 75 percent, and the concept of a pure foundry was openly mocked.
• The foundry model he established created the fabless semiconductor industry that now includes Nvidia, Qualcomm, AMD, and Apple's chip teams.
• Retired from the TSMC chairmanship in 2018, after which TSMC became central to global chip-supply-chain and Taiwan Strait discussions.