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

Power — not compute — is quickly emerging as the main constraint on scaling AI data centres. That reality has led Peak XV Partners to back C2i Semiconductors, an Indian startup developing plug-and-play, system-level power solutions to reduce energy losses and improve the cost structure of large-scale AI infrastructure.

C2i (short 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. The round brings the two-year-old company's total funding to $19 million.

The funding arrives as data-centre electricity demand accelerates globally. A December 2025 BloombergNEF report projects data-centre power consumption will nearly triple by 2035, while Goldman Sachs Research estimates data-centre power demand could rise 175% by 2030 compared with 2023 levels — roughly equivalent to adding another top-10 power-consuming country.

A large portion of this pressure isn't about producing electricity, but about converting it efficiently once it enters the data centre. Within modern facilities, high-voltage power must be stepped down repeatedly—thousands of times—before it reaches GPUs. That conversion chain currently wastes roughly 15% to 20% of energy, according to C2i co-founder and CTO Preetam Tadeparthy, who discussed the issue in an interview.

"What used to be 400 volts has already moved to 800 volts, and will likely go higher," Tadeparthy said.

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 rethinking power delivery as a single, integrated, plug-and-play "grid-to-GPU" system — spanning from the data-centre bus all the way to the processor.

Rather than optimising isolated components, the company treats power conversion, control, and packaging as a single, coordinated platform. C2i estimates this approach can reduce end-to-end losses by around 10% — about 100 kilowatts saved per megawatt consumed — with follow-on benefits for cooling requirements, GPU utilisation, and overall data centre economics.

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

For Peak XV Partners — which separated from Sequoia Capital in 2023 — the appeal centres on how power costs shape the economics of AI infrastructure at scale. Rajan Anandan, the firm's managing director, said that after the upfront capital spending on servers and facilities, energy becomes the dominant ongoing cost for data centres, making even modest efficiency improvements 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."

Those claims will face near-term scrutiny. 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-centre operators and hyperscalers that have requested access to review the results, according to Tadeparthy.

The Bengaluru-based company has assembled a team of about 65 engineers and is establishing customer-facing operations in the U.S. and Taiwan as it moves toward early deployments.

Power delivery is among the most entrenched layers of the data-centre stack, historically dominated by large incumbents with deep balance sheets and lengthy qualification cycles. While many newer entrants focus on improving individual parts, end-to-end power delivery redesign requires tight coordination across silicon, packaging, and system architecture—a capital-intensive effort that relatively few startups pursue and that can take years to prove in real production environments.

Anandan said the key question is now execution, noting that every startup faces technology, market, and team risks when betting on how an industry evolves. In C2i's case, he argued, the feedback loop could be comparatively fast. "We'll know in the next six months," Anandan said, pointing to the upcoming silicon returns and early customer validation as the moment when the investment thesis will be tested.

The investment also reflects a weak XXV's view of a strengthening semiconductor design ecosystem in India.

"The way you should look at semiconductors in India is, this is like 2008 e-commerce," Anandan said. "It's just getting started."

He pointed to the depth of engineering talent — including a growing share of global chip designers now based in the country — along with government-backed design-linked incentives that reduce the cost and risk of tape-outs. Together, those shifts are making it increasingly feasible for startups to build globally competitive semiconductor products in India, rather than operate only as captive design centres.

Whether those conditions translate into a globally competitive product should become clearer in the coming months, as C2i begins customer validation of its system-level power solutions.