Ethereal Machines Raises $28.5 Million Series B to Revolutionize Precision Manufacturing in India
Precision manufacturing startup Ethereal Machines has successfully raised $28.5 million in a Series B funding round led by Avataar Ventures, with participation from Peak XV Partners and other investors. This fresh capital injection marks a significant milestone for the company as it plans major expansion initiatives aimed at strengthening Indias capabilities in advanced engineering and industrial production.
Expansion Plans and Key Investment Areas
The funds will be strategically utilized across five priority areas, featuring the construction of a large-scale 300,000 sq. ft. manufacturing facility near Bengaluru. This new facility will be a leap forward — approximately six times the size of the current plant — and is set to be delivered in phases starting later this year.
Other major investment areas include the development of Indias first proprietary multi-axis CNC (Computer Numerical Control) controller, which acts as the brain and nervous system of CNC machines. This indigenous technology is poised to become a critical sovereign technology for the country, reducing import dependency and fostering innovation.
Additionally, Ethereal Machines plans to expand its AI-powered factory software platform, Vesper, grow its presence in semiconductor manufacturing, and advance its global footprint through dedicated teams in the U.S. and Europe.
Scaling Manufacturing Capacity
Cofounder and CEO, Kaushik Mudda, shared insights about scaling the indigenous CNC controller project, which has been in development for over four years. The startup aims to increase its machine count from 60 currently to over 1,000 machines eventually.
The company already operates a fully automated smart manufacturing facility in Peenya, Bengaluru, running 24×7 across three shifts. Since its $13 million Series A round in 2024, Ethereal Machines has tripled its Machining-as-a-Service (MaaS) revenue and increased production capacity tenfold, demonstrating rapid growth and scalability.
Diversifying Across Key Growth Sectors
Founded in 2014 by Kaushik Mudda and Navin Jain, Ethereal Machines designs and manufactures proprietary multi-axis CNC machines and supplies high-precision components across various industries such as aerospace, defence, healthcare, semiconductor, and consumer electronics.
While aerospace and healthcare were initial focus areas, semiconductor manufacturing, consumer electronics, and energy infrastructure are now emerging as major growth sectors. The startup is already fulfilling orders for global semiconductor and electronics firms and anticipates these sectors will contribute an increasing share of revenue in the coming year.
Demand from power-generation equipment manufacturers is also on the rise, fueled by expansion in AI infrastructure and data centers, positioning Ethereal Machines to play a crucial role in next-generation energy and tech manufacturing.
Global and Domestic Market Outlook
Currently, about 70% of Ethereal Machines revenue comes from exports to markets including the U.S., Europe, the UK, and Japan. However, the company expects domestic demand to surge as India accelerates its manufacturing activities and focuses on self-reliance.
This financial boost will enable Ethereal Machines to capitalize on expanding opportunities in precision manufacturing and establish itself as a key player in Indias industrial growth narrative.
Conclusion
Ethereal Machines significant Series B funding is a testament to the growing confidence of investors in Indias deeptech startup ecosystem. With plans to build Indias first proprietary CNC controller and expand its manufacturing footprint massively, Ethereal Machines is positioning itself at the forefront of precision engineering and industrial innovation. This growth not only strengthens Indias advanced manufacturing capabilities but also propels the country towards technological sovereignty and global competitiveness.
As the company progresses with these ambitious plans, it is set to become a significant contributor to various high-growth sectors, priming India for a new era of industrial and technological development.
