Power efficiency is becoming a critical factor in the scalability of AI data centers, surpassing computational capabilities. In response to this shift, Peak XV Partners has invested in C2i Semiconductors, an Indian startup focused on developing system-level power solutions to enhance energy efficiency and optimize the economics of large-scale AI infrastructure.
C2i, short for control conversion and intelligence, has recently secured $15 million in a Series A funding round led by Peak XV Partners, with additional participation from Yali Deeptech and TDK Ventures, bringing the total funding raised by the startup to $19 million since its inception two years ago.
The increasing demand for energy in data centers globally has raised concerns about the sustainability of current power consumption levels. Reports suggest that electricity consumption in data centers is projected to nearly triple by 2035, with a potential surge of 175% in power demand by 2030 compared to 2023 levels. The inefficiencies in power conversion processes within data centers contribute significantly to energy wastage, with approximately 15% to 20% of energy lost during voltage conversions before reaching GPUs.
C2i, founded in 2024 by former Texas Instruments power executives and other industry experts, is revolutionizing power delivery systems by introducing a holistic approach to power conversion, control, and packaging. By implementing a single, plug-and-play “grid-to-GPU” system, C2i aims to reduce end-to-end energy losses by around 10%, translating to substantial energy savings and cost reductions for data center operators.
The strategic investment by Peak XV Partners underscores the importance of energy efficiency in driving the economics of AI infrastructure at scale. Rajan Anandan, managing director of the venture firm, highlights the significant impact of energy costs on the overall expenses of data centers, making incremental efficiency improvements highly valuable in the long run.
C2i is currently awaiting the return of its initial silicon designs from fabrication, scheduled between April and June. The startup plans to collaborate with data center operators and hyperscalers to validate the performance of its power solutions and assess their impact on operational efficiency and cost savings.
The innovative approach taken by C2i in redesigning power delivery systems reflects the growing maturity of India’s semiconductor design ecosystem. With a talented pool of engineers and government-backed incentives supporting semiconductor development, Indian startups like C2i are well-positioned to compete globally in the semiconductor market.
As C2i progresses towards validating its system-level power solutions with customers, the industry will closely monitor the startup’s performance and market reception. The next few months will be crucial in determining the success of C2i’s approach and its potential to disrupt the data center power efficiency landscape.
