In business, don’t take no for an answer.

Today I heard the inside story of how Arizona won TSMC as a partner in May 2020, straight from the source.

TSMC’s total investment in Arizona will exceed $65B with three fabs, which is the largest foreign direct investment in Arizona history and the largest foreign direct investment in a greenfield project in American history.

The story began in 2013. Governor Brewer and Arizona Commerce Authority CEO Sandra Watson were the original delegation sent to Taiwan to meet with Foxconn and TSMC. At that time, there was a lot of buzz about Arizona in Taiwan due to Apple’s announcement of sapphire glass in Mesa, Arizona.

The delegation had prepared an unsolicited cost analysis proposal to attract manufacturing to Arizona, but TSMC canceled the meeting the day before.

“We’ll still drop off our proposal at your HQ,” said the delegation.

“No, you can mail us the proposal,” replied TSMC.

The delegation didn’t budge. They insisted upon going to HQ, explaining that they flew all this way and wanted to at least see their campus.

When the delegation showed up at HQ, a few TSMC execs were there to greet them. For one hour, the execs listened to the Arizona story and cost advantages in the context of geopolitical challenges.

From there, the relationship between TSMC and Arizona grew as they checked in with each other every half year or so.

When TSMC was ready in 2017 to consider American sites, they sent a team to Arizona to investigate. While they left impressed with Arizona, there was still a 30-40% cost differential to manufacture in Arizona versus Taiwan.

In 2019, work began with the Federal government on the CHIPS and Science Act to help bridge that cost differential gap.

In February 2020, TSMC sent another team to scout Arizona. Just 2 months later in April, they made their final decision.

In May 2020, TSMC publicly announced their plans to build a fab in Arizona.

Had the delegation simply agreed to leave Taiwan without meeting TSMC in 2013, they would have lost a chance to establish a relationship that grew into one of the most important foreign investments in American history.

Preparation + persistence = payoff