As AI data centers hit power limits, Peak XV backs Indian startup C2i to fix the bottleneck
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.
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“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,” Anandan said. “You’re talking about tens of billions of dollars.”
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.
ImagC2i co-founders Vikram Gakhar, Preetam Tadeparthy, Ram Anant, and Dattatreya Suryanarayana (Left to right)
Image Credits:C2i
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