As AI Data Centers Hit Power Limits, Peak XV Backs Indian Startup C2i to Fix the Bottleneck

Why It Matters

Improving power‑conversion efficiency directly cuts the dominant operating expense of AI data centers, unlocking billions in cost savings as demand surges. The backing also highlights growing confidence in India’s semiconductor design talent and its emerging role in the global AI infrastructure supply chain.

Key Takeaways

• Power conversion losses dominate AI data center costs
• C2i raised $15M Series A, total $19M funding
• Plug‑and‑play grid‑to‑GPU system targets 10% loss reduction
• Energy efficiency gains could cut data‑center OPEX billions
• India’s chip design ecosystem maturing, attracting global investors

Pulse Analysis

The rapid expansion of AI workloads is reshaping data‑center economics, with power consumption projected to triple by 2035 and demand rising 175% by 2030. While server hardware advances, the bottleneck now lies in the inefficiencies of high‑voltage conversion, which currently discards up to one‑fifth of incoming electricity as heat. This hidden cost not only inflates utility bills but also forces larger cooling infrastructures, eroding profit margins for hyperscalers and cloud providers.

C2i Semiconductors tackles the problem at its source by re‑architecting the power‑delivery chain into a single, plug‑and‑play module that spans from the data‑center bus to each GPU. By integrating silicon, packaging, and control logic, the startup claims a 10% reduction in end‑to‑end losses—equivalent to saving about 100 kW for every megawatt consumed. Such savings translate into lower cooling requirements, higher GPU utilization, and a markedly improved total cost of ownership. With its first silicon slated for delivery in mid‑2026, C2i is positioning itself for rapid validation with hyperscalers eager to offset soaring energy expenses.

The $15 million Series A led by Peak XV underscores a broader shift in venture capital focus toward energy‑efficient infrastructure solutions. It also signals confidence in India’s maturing semiconductor design ecosystem, which now benefits from government incentives and a deep talent pool. As incumbents grapple with long qualification cycles, agile startups like C2i could capture market share by delivering faster, cost‑effective power solutions, potentially redefining the competitive dynamics of the global AI data‑center supply chain.

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

TechCrunch · Boston, MA · June 23 2026

Power, rather than compute, is fast becoming the limiting factor in scaling AI data centers. That shift has prompted Peak XV Partners to back C2i Semiconductors, an Indian startup building plug‑and‑play, system‑level power solutions designed to cut energy losses and improve the economics of large‑scale AI infrastructure.

C2i (which stands for control conversion and intelligence) 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 data‑center energy demand accelerates worldwide. Electricity consumption from data centers is projected to nearly triple by 2035, per a December 2025 report from BloombergNEF, while Goldman Sachs Research estimates data‑center power demand could surge 175 % by 2030 from 2023 levels — the equivalent of adding another top‑10 power‑consuming country.

Much of that strain comes not from generating electricity but from converting it efficiently inside data centers, where high‑voltage power must be stepped down thousands of times before it reaches GPUs. This process currently wastes about 15 % to 20 % of energy, C2i’s co‑founder and CTO Preetam Tadeparthy said in an interview.

“What used to be 400 volts has already moved to 800 volts, and will likely go higher,” Tadeparthy told TechCrunch.

Founded in 2024 by former Texas Instruments power executives Ram Anant, Vikram Gakhar, Preetam Tadeparthy, and Dattatreya Suryanarayana, along with Harsha S. B and Muthusubramanian N. V, C2i is redesigning power delivery as a single, plug‑and‑play “grid‑to‑GPU” system spanning the data‑center bus to the processor itself.

Image: Four men standing in front of a sign that reads “C2i Semiconductors Private Limited.”

By treating power conversion, control and packaging as an integrated platform, C2i estimates it can cut end‑to‑end losses by around 10 % — roughly 100 kW saved for every megawatt consumed — with knock‑on effects for cooling costs, GPU utilisation and overall data‑center economics.

“All that translates directly to total cost of ownership, revenue, and profitability,” Tadeparthy said.

For Peak XV Partners (which split from Sequoia Capital in 2023), the attraction lies in how power costs shape the economics of AI infrastructure at scale. Rajan Anandan, the venture firm’s managing director, told TechCrunch that after the upfront capital investment in servers and facilities, energy costs become the dominant ongoing expense for data centers, making even incremental efficiency gains highly valuable.

“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

The claims will be tested quickly. C2i expects its first two silicon designs to return from fabrication between April and June, after which the startup plans to validate performance with data‑center operators and hyperscalers that have asked 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 U.S. and Taiwan as it prepares for early deployments.

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

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

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

“The way you should look at semiconductors in India is, this is like 2008 e‑commerce,” said Anandan. “It’s just getting started.”

He pointed to the depth of engineering talent — with a growing share of global chip designers based in the country — alongside government‑backed design‑linked incentives that have lowered the cost and risk of tape‑outs, making it increasingly viable for startups to build globally competitive semiconductor products from India rather than operate only as captive design centers.

Whether those conditions translate into a globally competitive product will become clearer over the coming months, as C2i begins validating its system‑level power solutions with customers.