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

Power, rather than compute, is quickly becoming the limiting factor in scaling AI data centers. That change prompted Peak XV Partners to support C2i Semiconductors, India’s first architectural plug-in, system-level power solutions designed to reduce power loss and improve the economics of large-scale AI infrastructure.

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

The investment comes as demand for data center power is growing rapidly around the world. Electricity consumption in 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 increase by 175% by 2030 from 2023 levels – the equivalent of adding another 10 energy-consuming countries.

Much of that 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 GPUs. This process currently wastes about 15% to 20% of energy, C2i founder and CTO Preetam Tadeparty said in an interview.

“What used to be 400 volts has already moved to 800 volts, and it’s likely to go up,” Tadeparty told TechCrunch.

Founded in 2024 by former Texas Instruments power executives Ram Anant, Vikram Gakhar, Preetam Tadeparty, and Dattatreya Suryanarayana, as well as Harsha S. B and Muthususubramanian N. V, C2i reimagines power delivery as a plug-and-play “grid-to-GPU-data processing system”.

By managing power conversion, control and packaging as an integrated platform, C2i estimates that it can reduce end-to-end losses by 10% – approximately 100 kilowatts saved for every megawatt used – with ongoing effects on cooling costs, GPU usage and the overall economy of the data center.

“All of that translates directly into total cost of ownership, revenue, and profit,” Tadeparty said.

For Peak XV Partners (separating from Sequoia Capital in 2023), the fascination lies in how energy costs shape the economics of AI infrastructure at scale. Rajan Anandan, the company’s managing director, told TechCrunch that after the high investment in servers and facilities, energy costs become an ongoing cost of data centers, making even the increased efficiency gains more valuable.

“If you can reduce energy costs, say, 10 to 30%, that’s like a huge amount,” Anandan said. “You’re talking about tens of billions of dollars.”

Applications will be evaluated immediately. C2i expects its first two silicon designs to return from production between April and June, after which the startup plans to confirm operations with data center operators and hyperscalers who have requested data updates, according to Tadeparty.

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 prepares for early deployment.

Power delivery is one of the most focused parts of the data center stack, long dominated by incumbents with deep balance sheets and annual learning cycles. While many new companies focus on developing individual components, redesigning end-to-end power delivery requires integrating silicon, packaging, and system architecture at the same time — a costly approach that requires a few startups and can take years to prove in manufacturing environments.

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

Bet also shows how the Indian semiconductor design ecosystem has grown in recent years.

“The way you have to look at semiconductors in India, this 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 – and government-linked incentives that have reduced the cost and risk of tape-outs, making it more powerful for start-ups to build globally competitive semiconductor products from India instead of operating as captive design centers.

Whether those trends translate into a globally competitive product will become even clearer in the coming months, as C2i begins to validate its system power solutions with customers.