SkyWater Technology is an American semiconductor engineering and fabrication foundry, based in Bloomington, Minnesota. It is a U.S.-based DMEA-accredited Category 1A Trusted Foundry.
Why does SkyWater matter to the semiconductor ecosystem and the U.S.?
We play a key role in addressing the vulnerabilities in global supply chains revealed by the COVID pandemic. The push for "Made in America," which began under the previous administration, has accelerated, and we are at the forefront of bringing semiconductor manufacturing back to the U.S. In 2017, we set out to revamp a semiconductor facility in Minnesota to foster innovation in non-extreme nodes—critical but often overlooked parts of the ecosystem. Despite the prevailing notion that manufacturing was no longer viable in the U.S., SkyWater aimed to change that. SkyWater’s model is built on Technology as a Service, not just as a manufacturer. This approach allows the company to innovate alongside its customers, growing from one customer in 2017 to more than 50 today. As the demand for AI and advanced packaging grows, SkyWater’s ability to co-optimize product development with clients places it in a prime position to lead in innovation.
How are you able to deliver for 50 different customers with such diverse needs?
The integration of R&D within our manufacturing environment allows us to streamline product development and move quickly from concept to production. By developing innovations in the same facility where they will be manufactured, we can respond rapidly to changing customer needs and industry trends. This has been particularly valuable during downturns when development can proceed even as demand for silicon slows. While we work across diverse sectors like biosensing, space, and defense, 80% of our work is the same for all clients. The remaining 20% is where customization happens. Our Technology as a Service model allows customers to tailor solutions to their specific needs, enabling them to create differentiated products while we retain control of the manufacturing IP, ensuring long-term partnerships.
How do you protect the vested interests of a customer while maintaining IP?
We operate in a collaborative space where our customers, competitors, and collaborators may overlap. We safeguard our clients' interests by controlling the manufacturing IP, which would be difficult and costly for a customer to replicate elsewhere. This ensures that the relationship remains strong, as customers benefit from our infrastructure and expertise. Our model, akin to other industries like computing, allows customers to innovate while reducing the risks manufacturers traditionally face.
What sets SkyWater’s foundry model apart from larger companies?
Our foundry model focuses on close customer relationships, unlike the more transactional nature of larger foundries. As a smaller player, we can offer deeper collaboration and a more personalized approach. This aligns with the resurgence of "Made in America," where local manufacturing is becoming increasingly important. We can also leverage our position in the U.S. semiconductor industry, which has historically been a global leader in equipment and design. Our Technology as a service model enables us to innovate and grow without taking on massive debt, a rarity in the capital-heavy semiconductor industry.
What opportunities do you see as a result of the "Made in America" movement?
The push for semiconductor manufacturing in the U.S., supported by initiatives like the CHIPS Act, has opened up new opportunities for us. As a U.S.-based pure-play foundry, we focus solely on contract manufacturing without competing with our customers. This allows us to serve a unique market, especially as demand for AI and system-in-package solutions continues to rise. Our ability to remain financially nimble while achieving profitability—an accomplishment only TSMC has matched in the same time frame —puts us in a strong position. Our alignment with national interests, including partnerships with the National Advanced Semiconductor Technology Center (NASTC), means we will play a key role in the reshoring of critical manufacturing in the U.S.
What keeps you up at night in terms of SkyWater’s future?
The primary challenge for us is ensuring readiness for the anticipated industry rebound. The semiconductor industry is known for its cyclical nature, and while we have used the downturn to strengthen our R&D, scaling up quickly will be essential. SkyWater’s agility is an advantage, but managing the expected increase in volume will be a key test. Our strong relationships with the Department of Defense (DoD) and startups in the biosensing space position us well for future growth. However, we must maintain our innovative edge while handling increased demand without compromising the quality of our partnerships.
What role does the open-source silicon initiative play in SkyWater’s future?
Our SKY130 platform, part of the open-source silicon initiative, is democratizing access to silicon design. Driven by Google and NIST, this initiative allows companies to develop silicon more affordably, benefiting startups and supporting workforce development. Universities are using SKY130 as a platform for students to design silicon, creating the next generation of engineers. In lowering the barriers for innovation, we are seeding future growth in the semiconductor industry.
What are SkyWater’s next milestones, and how do you see the future of the U.S. semiconductor industry?
Our future milestones focus on advanced packaging, supported by U.S. government initiatives. We are working on a $120 million program to develop packaging technologies for the DoD. Our open innovation approach, combined with technology-as-a-service, allows us to collaborate with tier-one manufacturers while also supporting smaller companies.
As the semiconductor industry evolves, we aim to be at the forefront of reshoring manufacturing in the U.S. We will continue to innovate with a flexible, customer-centric model, and we will play a key role in driving the next wave of innovation in AI, biosensing, and green energy.
