What does it mean when Uncle Sam is one of the largest shareholders? Chip Startup XLight is to find out

The Trump administration has agreed to inject up to $150 million xLightsemiconductor startup develops advanced chip-making technology, marking the third time the US government has taken an equity position in a private startup and more controversial strategies that have implemented the Washing of corporate America.

The Wall Street Journal Reported Monday If the department of denven will give funds to XLight in exchange for an equity stake that will be the government’s largest share of the startup. The deal uses funds from President Trump’s 2022 Chips and Tourism Act award in Trump’s second term, though it is early and subject to change.

Previous Government Equity investments in Trump administrations include publicly traded companies IntelMP material, American Lithiumand Metals trilogySee rank-. Two Rare Earth Startup It also secured funding in exchange for Equity from the commerce department last month.

You can imagine how this all plays out in Silicon Valley, where the libertarian ethos runs deep. In TechCrunch’s tech sign disrupting event back in October, Roelof BOTHA Sequoia jokes are offered What could be the understatement of the year when asking about trends: “(some) of the most dangerous words in the world are: ‘I am from the government, and I will help.'”

Another VCS with the same concern, if quietly, about what it means when the portfolio company suddenly competes against the US treasury, or when they find it on the table of the representative of the audience.

The four-year-old, Palo Alto, California, company at the center of this special experiment is trying to do something really cool in a semiconductor factory. XLhlight wants to build a particle accelerator-powered machine – a machine the size of a football field, mind you – that will create a more powerful and precise light source for making chips.

If it works, it could challenge the dominance of the nearest ASML, the Dutch giant that has been publicly traded since 1995 and now enjoys an extreme absolute monopoly. (Shares are up 48.6% this year.)

Xlight’s CEO is Nicholas Kelez, a quantum computing and government veteran who can understand particle acceleration. Helping the effort as executive chairman is Pat Gelsinger, former Intel CEO who was shown the door late last year after an ambitious factory revival plan failed to materialize.

“I’m not done yet,” Gelsinger – general partner at Global Global, which led to the start $40 million This summer’s fundraising circle – told the journal, adding that the effort was “personal” for him.

Indeed, Xlight not only wants to compete with ASML but more. While the ASML engine works at wavelengths around 13.5 nanometers, xlight targets 2 nanometers. Gelsinger claims the technology can improve wafer processing efficiency by 30% to 40% while using significantly less energy.

As it happens, Kalez and Gelsinger will continue to hold an event at TechCrunch on Wednesday night in Palo Alto, where the government will undoubtedly be. (You still can Nab is sitting here.)

Commerce Secretary Howard Lutnick, for his part, insisted that this includes national security and technology leaders, saying the partnership could be “at the expense of chipmaking.” Critics will continue to question whether the tax-paying equity stock represents industrial policy or state capitalism with a patriotic sheen, even if there are no such skeptics.

At least Botha, who describes himself disturbingly as “a libertarian type, a free market thinker by Nature,” says industrial policy exists when the national interest is demanded. “The only reason we are included is because we have other countries to say who is involved with the industry for more complete and maybe for long-term interests.”