As AI data centers reach power limits, Peak XV supports Indian startup C2i to fix the bottleneck

Power, not compute, has become the limiting factor in scaling AI data centers. This shift has led Peak XV Partners to back C2i Semiconductors, an Indian startup building system-level power solutions designed to reduce energy losses and improve the economics of large-scale AI infrastructure.

C2i (which stands for Control and Intelligence Transformation) has raised $15 million in a Series A round led by Peak XV Partners, with participation from Yali Deeptech and TDK Ventures, bringing the two-year-old startup’s total funding to $19 million.

The investment comes as power demand accelerates in data centers around the world. Electricity consumption from data centers is expected to nearly triple by 2035, according to a December 2025 report from BloombergNEF, while Goldman Sachs Research estimates that data center energy demand could rise 175% by 2030 compared to 2023 levels — the equivalent of adding another country among the top 10 energy consumers.

Much of this pressure comes not from generating electricity, but from converting it efficiently inside data centers, where high-voltage power must be reduced thousands of times before it reaches the graphics processing units. The process currently wastes about 15% to 20% of energy, Pritam Tadiparthi, C2i’s co-founder and CTO, said in an interview.

“What was 400 volts has already moved to 800 volts, and will likely go higher,” Tadiparthi told TechCrunch.

Founded in 2024 by former Texas Instruments power executives Ram Anant, Vikram Jakhar, Pritam Tadiparthi, and Dattatreya Suryanarayana, along with Harsha S.B. and Muthusubramanian N.V, C2i is redesigning power delivery as a single “network-to-GPU” plug-and-play system that extends the data center bus to the processor itself.

By treating power conversion, control, and packaging as an integrated platform, C2i estimates it can reduce overall losses by about 10% — roughly 100 kilowatts saved for every megawatt consumed — with knock-on effects on cooling costs, GPU utilization, and overall data center economics.

“All of this translates directly into total cost of ownership, revenue and profitability,” Tadiparthi said.

For Peak Rajan Anandan, managing director of the investment firm, told TechCrunch that after the initial capital investment in servers and facilities, energy costs became the dominant ongoing expense for data centers, making the incremental efficiency gains highly valuable.

“If you can reduce energy costs by 10 to 30 percent, that’s a huge number,” Anandan said. “You’re talking tens of billions of dollars.”

Claims will be tested quickly. C2i expects the first two silicon designs to return from manufacturing between April and June, after which the startup plans to validate performance with data center operators and hyperscalers who have requested to review the data, according to Tadeparthy.

The Bengaluru-based startup has built a team of about 65 engineers and is setting up customer-facing operations in the US and Taiwan as it gears up for early deployments.

Power delivery is one of the most established parts of the data center stack, which has long been dominated by large companies with deep balance sheets and years-long onboarding cycles. While many new companies focus on improving individual components, comprehensively redesigning power delivery requires coordinating silicon, packaging, and system architecture simultaneously — a capital-intensive approach that few startups attempt and can take years to prove in production environments.

The real question now is execution, Anandan said, noting that all startups face technology, market and team risks when betting on how industries evolve. In the case of C2i, the feedback loop should be relatively short, he said. “We’ll know that in the next six months,” Anandan said, noting that upcoming silicon and early customer validation is the moment when the thesis will be tested.

The bet also reflects how much India’s semiconductor design ecosystem has matured in recent years.

“The way you have to look at semiconductors in India is that it is like e-commerce in 2008,” Anandan said. “It’s just the beginning.”

He pointed to the depth of engineering talent – with a growing share of global chip designers based in the country – coupled with government-backed design-linked incentives that have reduced the cost and risk of stripping down, making it increasingly possible for startups to build globally competitive semiconductor products from India rather than operating solely as captive design centres.

Whether these conditions translate into a globally competitive product will become clearer over the coming months, as C2i begins to validate its system-level power solutions with customers.