Peak XV Leads $15 Million Bet on DLI-Backed Chip Startup C2i Semiconductors

India’s semiconductor design ecosystem gains momentum as Bengaluru venture builds ‘intelligent power brain’ for AI data centres.

India’s semiconductor chip design ecosystem is steadily strengthening under the Government of India’s Design Linked Incentive (DLI) Scheme, with startups drawing growing interest from both investors and the user community. As deep-tech ventures in semiconductors typically require long development cycles, heavy R&D investment and higher technical risk before revenues begin, early-stage funding in the sector had historically remained limited in India prior to 2021.

The DLI Scheme, announced in 2022, is changing that trajectory by reducing upfront risk through financial support, access to advanced Electronic Design Automation (EDA) tools, IP cores and ecosystem-wide enablement. Startups are onboarded through a rigorous evaluation process by an expert committee of industry and technical specialists, ensuring that credible and high-potential companies receive structured support.

This intervention is now translating into rising investor confidence, with global venture capital firms actively evaluating DLI-supported semiconductor startups.

C2i Semiconductors: Building Power Solutions for the AI Data Centre Era

One such fast-emerging player is C2i Semiconductors, incorporated in Bengaluru on 5 June 2024 by a founding team with decades of experience at global semiconductor leaders including Texas Instruments, National Semiconductor and Maxim Integrated.

The company was approved for financial support and access to advanced chip design infrastructure under the DLI Scheme with effect from 1 November 2024.

With industry veteran Ganapathy Subramanyam, Founding Managing Partner at Yali Capital, on its Board, C2i is developing next-generation power-management semiconductor solutions tailored for AI data centres and cloud infrastructure.

Rapid Engineering Scale-Up and Strong Adoption of National Design Infrastructure

C2i has quickly expanded to a 65-member engineering team, reflecting both the scale and urgency of innovation in the power semiconductor space.

Notably, the startup has become one of the top three users among nearly 100 companies accessing centralized EDA tools through the ChipIN Centre, enabled under the DLI Scheme. This highlights the growing utilisation of India’s shared semiconductor design infrastructure and the increasing sophistication of domestic chip design ventures.

The Challenge: Power is the New Bottleneck for Modern Data Centres

As AI workloads surge, modern hyperscale data centres require extremely large and stable power delivery systems. Legacy architectures were not built for continuous high-density computing, leading to:

• energy loss and inefficiency

• excess heat generation

• reliability and failure risks

• difficulty in scaling infrastructure for AI-driven demand

Power delivery has now become one of the most critical constraints in expanding global AI compute capacity.

The Innovation: A ‘Grid-to-Core’ Rethink of Power Delivery

C2i Semiconductors is addressing this challenge by redesigning how electricity flows inside servers — from the incoming grid supply all the way to the processor chip.

Rather than improving individual components in isolation, the company is developing a smart, configurable system-level power platform that optimizes power delivery in real time.

Its approach enables:

• stable power under heavy AI workloads

• higher energy efficiency

• reduced heat and equipment failures

• extended GPU and server lifespan

• simplified server design

• faster deployment of hyperscale infrastructure

• scalable expansion for next-generation data centres

In Simple Terms: An Intelligent Power Brain for AI Infrastructure

C2i’s technology functions like an “intelligent power control brain” for AI data centres — ensuring that high-performance compute systems operate reliably, efficiently and continuously.

The company expects its first silicon designs to return from fabrication by mid-year, after which performance validation will begin.

Investor Confidence: Peak XV Leads $15 Million Round

Recognising the potential of C2i’s breakthrough solution, Peak XV Partners (formerly Sequoia Capital India & SEA) has led a $15 million investment round to accelerate development of ultra-reliable, high-density power delivery solutions.

This follows a $4 million funding round led by Yali Capital in 2024, taking cumulative investment raised to approximately ₹170 crore, in addition to support received under the DLI Scheme.

Rajan Anandan, Managing Director at Peak XV, noted that C2i’s approach could significantly extend GPU lifespan and unlock billions of dollars in industry savings globally.

Policy Alignment: Advancing India’s Design-Led Semiconductor Vision

The investment momentum aligns with the vision articulated by Union Minister Shri Ashwini Vaishnaw, who has emphasised that India’s semiconductor programme is focused on strengthening both design and manufacturing ecosystems.

He has underlined that India already possesses a strong chip design talent base, and that the Government’s role is to enable startups through:

• design incentives

• advanced EDA tools and IP access

• ecosystem partnerships

• support for globally competitive product companies

The growing success of ventures like C2i underscores India’s emergence as a trusted semiconductor design and innovation partner to the world.