C2i Semiconductors Lands $15M to Tackle AI Data Center Power Bottleneck, Promising Massive Efficiency Gains

The relentless growth of artificial intelligence is creating an unprecedented demand for computing power, and increasingly, the availability of that power is becoming a major limiting factor. Data centers, the engines driving the AI revolution, are facing escalating energy consumption, prompting a surge in innovation aimed at boosting efficiency. C2i Semiconductors, a Bengaluru-based startup, is emerging as a key player in this arena, securing $15 million in Series A funding led by Peak XV Partners to revolutionize power delivery in AI data centers.

C2i's core mission is to address the significant energy losses that occur during power conversion within data centers. Currently, the process of stepping down high-voltage power to the levels required by GPUs can waste as much as 15% to 20% of the total energy input. Founded in 2024 by industry veterans from Texas Instruments, C2i is developing plug-and-play, system-level power solutions that treat power conversion, control, and packaging as a single, integrated platform, spanning from the data center bus all the way to the processor. This 'grid-to-GPU' approach promises to significantly reduce energy wastage and improve overall data center economics. The Series A round also included participation from Yali Deeptech and TDK Ventures, bringing the startup's total funding to $19 million.

The potential impact of C2i's technology is substantial. The company estimates that its solutions can cut end-to-end power losses by approximately 10%, translating to significant savings in kilowattage per megawatt consumed. This reduction in energy consumption directly impacts cooling costs, GPU utilization, and overall data center profitability. Industry projections paint a stark picture of escalating energy demand. A BloombergNEF report from December 2023 forecasts that data center electricity consumption will nearly triple by 2035, while Goldman Sachs Research anticipates a 175% surge in data center power demand by 2030 compared to 2023 levels. This increase is equivalent to adding another top-10 power-consuming country to the global grid, underscoring the urgent need for innovative solutions like C2i's.

Peak XV Partners, which spun out from Sequoia Capital in 2023, recognizes the pivotal role of power costs in shaping the economics of AI infrastructure. Rajan Anandan, managing director at Peak XV, emphasizes that energy costs become the dominant ongoing expense for data centers after the initial capital investment in servers and facilities. Even incremental efficiency gains can translate into substantial savings. C2i expects its first silicon designs to return from fabrication between April and June. The startup plans to validate performance with data-center operators and hyperscalers that have already expressed interest in reviewing the data. The company is also expanding its operations, establishing a customer-facing presence in the U.S. and Taiwan to support early deployments.

C2i's approach challenges the traditional power delivery landscape, which has long been dominated by established players. By taking a holistic view of power delivery, C2i is tackling a complex challenge that requires expertise in silicon, packaging, and system architecture. This capital-intensive approach is relatively rare for startups, and proving the technology in real-world production environments will be a crucial test. However, if successful, C2i's innovative power solutions could significantly reduce the energy footprint of AI data centers, paving the way for a more sustainable and efficient future for artificial intelligence.