Ethereal Machines, an Indian deeptech manufacturing startup, has closed a $28.5 million Series B funding round led by Avataar Ventures. The company plans to use the capital to build a large manufacturing facility near Bengaluru, advance its AI-powered factory software, and introduce India's first indigenous multi-axis CNC controller while expanding internationally.
- Raised $28.5M in Series B to expand manufacturing and product development
- Plans to build a 3 lakh sq ft mega-factory near Bengaluru
- Focus on AI-powered software and multi-axis CNC technology
What happened
Ethereal Machines has secured $28.5 million in a Series B funding round led by Avataar Ventures, with participation from existing investors such as Peak XV Partners. Founded in 2014, the startup specializes in high-precision multi-axis CNC machines and delivers sub-10-micron accuracy machine solutions through its Machining-as-a-Service (MaaS) model. The company currently operates India’s first fully automated smart manufacturing facility in Bengaluru.
With this new capital injection, Ethereal Machines plans to develop a 3 lakh square foot mega-factory near Bengaluru, enhance its AI-driven factory operating software named Vesper, and pioneer India’s first indigenous multi-axis CNC controller. Part of the funds will also target expanding the company’s footprint in key international markets including the US and Europe.
Why it matters
Ethereal Machines' expansion marks a significant step forward in India's deeptech manufacturing capabilities, particularly for industries requiring ultra-precise components like aerospace, defence, healthcare, and semiconductors. Precision CNC manufacturing is critical for the advanced chipmaking infrastructure that India is aiming to strengthen domestically, aligning with its broader ambitions in semiconductors and high-tech manufacturing.
The startup’s growth underscores rising investor confidence in India’s deeptech sector, driven by dedicated funds and increasing focus on AI and automation in manufacturing. Ethereal Machines’ integration of AI and automation in CNC machining and factory operations reflects a push towards smart manufacturing ecosystems, positioning India as a competitive player in the global precision manufacturing landscape.
What to watch next
Key developments to monitor include the construction and operational launch of Ethereal Machines' new mega-factory near Bengaluru, which is expected to dramatically scale their production capacity. The progress of their AI-powered software Vesper will also be crucial, as it could set new benchmarks for intelligent factory management in India’s manufacturing sector.
Additionally, the introduction of India’s first indigenous multi-axis CNC controller will be a milestone in reducing dependency on foreign technology and enhancing self-reliance in high-precision manufacturing. Finally, how effectively Ethereal Machines expands its presence in the US and European markets will indicate the global competitiveness of Indian deeptech startups.