Deep-tech precision manufacturing startup Ethereal Machines has raised $28.5 million in a Series B funding round led by Avataar Ventures, with participation from existing investor Peak XV Partners and other backers.
The company is raising fresh capital nearly two years after securing $13 million in its Series A round in June 2024. Notably, Entrackr had exclusively reported in April that Ethereal Machines was in talks to raise $28.5 million at a 4x valuation premium.
The fresh proceeds will be used to expand manufacturing infrastructure, develop India’s first indigenous multi-axis CNC controller, strengthen its software stack, support semiconductor manufacturing initiatives, and accelerate international expansion across the US and Europe.
Founded in 2014 by Kaushik Mudda and Navin Jain, Ethereal Machines designs and manufactures proprietary multi-axis CNC machines and offers precision component production through its Machining-as-a-Service (MaaS) platform. The company serves clients across aerospace, defence, healthcare, semiconductors, consumer electronics, and other high-precision engineering sectors.
The Bengaluru-based startup said its MaaS revenue has grown threefold year-on-year since its Series A round, while its production capacity has expanded tenfold. It currently operates a fully automated smart manufacturing facility in Peenya, Bengaluru, and has signed an MoU with the Karnataka government to establish a 300,000-square-foot manufacturing facility on the outskirts of the city.
According to the company, the upcoming plant is expected to create more than 2,000 jobs and become one of the largest automated advanced manufacturing facilities outside China. It also plans to continue investing in Vesper, its proprietary factory operating software that leverages AI to predict lead times, monitor factory performance in real time, and optimise production workflows.
Ethereal Machines has also developed proprietary CNC platforms, including Aura and Nimbus, which deliver sub-10-micron accuracy. It claims these systems enable high-precision manufacturing at significantly lower costs than global competitors.
On the financial front, the Bengaluru-based company reported operating revenue of Rs 11.45 crore in FY25, according to its annual financial statements. However, it posted a loss of Rs 27.27 crore during the same period as it continued investing in manufacturing capacity, technology development, and expansion.
The funding comes at a time when global supply chains are increasingly diversifying beyond China, creating opportunities for Indian manufacturing firms. Ethereal Machines aims to capitalize on this trend by building domestic capabilities in precision engineering and positioning itself as a global supplier of advanced manufacturing solutions.
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