Peak XV Invests $15M in C2i Semiconductors to Tackle AI Data Center Power Efficiency Crisis

As artificial intelligence infrastructure scales globally, power conversion efficiency is rapidly emerging as a critical bottleneck in data center operations. Indian semiconductor startup C2i Semiconductors has secured $15 million in Series A funding led by Peak XV Partners, with participation from Yali Deeptech and TDK Ventures, bringing total capital raised to $19 million since its 2024 founding.

The investment addresses a growing infrastructure challenge: data center electricity consumption is projected to nearly triple by 2035 according to BloombergNEF research, while Goldman Sachs estimates power demand could surge 175% by 2030 compared to 2023 baseline levels—equivalent to adding another top-10 global power-consuming nation to the grid.

The Power Conversion Problem

C2i (Control, Conversion, and Intelligence) is developing integrated, system-level power delivery solutions designed to minimize energy losses in AI infrastructure. Current data center architectures waste approximately 15-20% of energy during power conversion processes, where high-voltage electricity must be stepped down thousands of times before reaching GPU processors, according to CTO and co-founder Preetam Tadeparthy.

"What used to be 400 volts has already moved to 800 volts, and will likely go higher," Tadeparthy explained, highlighting the industry's ongoing voltage escalation to improve efficiency.

Grid-to-GPU Architecture

Founded by former Texas Instruments power management executives Ram Anant, Vikram Gakhar, Preetam Tadeparthy, Dattatreya Suryanarayana, Harsha S. B, and Muthusubramanian N. V, C2i is architecting a plug-and-play "grid-to-GPU" power delivery system that integrates the entire conversion chain from data center bus to processor.

By treating power conversion, control logic, and packaging as a unified platform rather than discrete components, C2i projects it can reduce end-to-end power losses by approximately 10%—translating to roughly 100 kilowatts saved per megawatt consumed. These efficiency gains cascade into reduced cooling requirements, improved GPU utilization rates, and enhanced total cost of ownership economics.

"All that translates directly to total cost of ownership, revenue, and profitability," Tadeparthy noted.

Economic Impact and Validation Timeline

Peak XV Partners Managing Director Rajan Anandan emphasized that after initial capital expenditure on servers and facilities, energy costs become the dominant operational expense for hyperscale data centers, making even incremental efficiency improvements highly valuable at scale.

"If you can reduce energy costs by, call it, 10 to 30%, that's like a huge number. You're talking about tens of billions of dollars," Anandan stated.

C2i expects its first two silicon designs to return from fabrication between April and June 2025, after which the startup plans validation cycles with data center operators and hyperscalers that have expressed interest in reviewing performance data.

Market Positioning and Execution Risk

The Bengaluru-based company has assembled a team of approximately 65 engineers and is establishing customer-facing operations in the United States and Taiwan ahead of initial deployments.

Power delivery systems represent one of the most entrenched segments of data center infrastructure, traditionally dominated by established vendors with extensive qualification cycles. C2i's approach of redesigning the entire power delivery stack—coordinating silicon design, advanced packaging, and system architecture simultaneously—is capital-intensive and carries significant execution risk.

Anandan acknowledged these challenges but noted the feedback loop should be relatively compressed: "We'll know in the next six months," he said, pointing to upcoming silicon validation and early customer engagements as critical milestones.

India's Semiconductor Ecosystem Evolution

The investment also reflects the maturation of India's semiconductor design capabilities. Anandan compared the current state of India's chip industry to "2008 e-commerce"—an inflection point where foundational elements are converging.

He cited the country's deep engineering talent pool, growing concentration of global chip designers, and government-backed design-linked incentive programs that have reduced tape-out costs and risks, enabling startups to develop globally competitive semiconductor products domestically rather than operating solely as captive design centers.

Whether C2i can successfully commercialize its system-level power solutions will become evident over the coming months as the company begins field validation with hyperscale customers.