AI Energy Crisis? ⚡ C2i's $15M Fix! 🚀
Tech
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In 2024, C2i Semiconductors was founded by former Texas Instruments executives aiming to address the escalating energy demands of artificial intelligence infrastructure. Peak XV Partners invested $15 million in the company, recognizing the critical role of reducing energy losses in data centers. C2i’s approach centers on redesigning power delivery as a single, integrated platform, spearheaded by CTO Preetam Tadeparthy. Goldman Sachs Research estimates data-center power demand could surge 175% by 2030. The company’s technology targets a potential 10% reduction in end-to-end losses. With a team of approximately 65 engineers, C2i is validating its system-level power solutions with data-center operators and hyperscalers, anticipating initial silicon designs to return from fabrication between April and June. The company’s focus on execution, coupled with a maturing Indian semiconductor design ecosystem – likened to 2008 e-commerce – suggests a significant opportunity for innovation and cost reduction within the rapidly expanding AI sector.
[POWER AS THE LIMITING FACTOR]
Power, rather than compute, is fast becoming the limiting factor in scaling AI data centers. This 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. The investment represents a significant step for a company tackling a core challenge within the rapidly expanding AI landscape.
[C2I’S INNOVATION AND FUNDING]
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. This injection of capital validates the company’s approach to addressing a critical bottleneck in AI data center operations – the inefficiency of power conversion. The company’s initial funding round highlights the growing investor confidence in their innovative solution.
[THE CHALLENGE OF POWER CONVERSION]
Much of the strain on data centers stems 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 stated in an interview. “What used to be 400 volts has already moved to 800 volts, and will likely go higher,” Tadeparthy told TechCrunch. This inefficiency underscores a fundamental problem within the data center architecture, one that C2i is directly addressing.
[A SYSTEM-LEVEL SOLUTION]
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. 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 kilowatts saved for every megawatt consumed — with knock-on effects for cooling costs, GPU utilisation and overall data-center economics. This holistic approach represents a departure from traditional, fragmented solutions.
[INVESTOR STRATEGY AND TIMELINE]
Peak XV Partners (which split from Sequoia Capital in 2023), the venture firm’s managing director Rajan Anandan, 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,” Anandan said. “You’re talking about tens of billions of dollars.” 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. This timeline highlights the rapid pace at which C2i intends to move from concept to validation.
[INDIA’S EMERGING SEMICONDUCTOR ECOSYSTEM]
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. “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. 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.
This article is AI-synthesized from public sources and may not reflect original reporting.