About Builder.ai
Builder.ai was founded in 2016 as Engineer.ai by Sachin Dev Duggal, marketing a platform that promised to let anyone, regardless of coding skill, build custom software applications simply by describing what they wanted, with the company's "Natasha" AI assistant guiding the process, a pitch that helped it raise more than $500 million from prominent investors including Microsoft, SoftBank, the Qatar Investment Authority, and Insight Partners, and reach a peak valuation of roughly $1.5 billion. Reporting as early as 2019 by the Wall Street Journal had already raised questions about the extent to which Builder.ai's supposedly AI-driven development process actually relied on large teams of human engineers, particularly contractors in India, working behind the scenes to complete much of the technical work manually.
The company's much more serious unraveling began in earnest in 2024 and 2025, when it emerged that Builder.ai had been operating without a permanent chief financial officer since 2023 and had substantially overstated its revenue, reportedly claiming around $220 million in 2024 revenue against an actual figure closer to $50 million, in part through alleged "round-tripping" transactions with an Indian content company, VerSe Innovation, in which the two firms were accused of billing each other for services to inflate both companies' reported sales. After an emergency $75 million funding round fell through and founder Duggal was replaced as CEO by Jungle Ventures executive Manpreet Ratia in February 2025, lender Viola Credit seized roughly $37 million from Builder.ai's accounts in May 2025 following the revenue revelations, precipitating an immediate collapse: the company informed hundreds of employees on a single town hall call that it was filing for bankruptcy and that they were all being laid off immediately. Builder.ai filed for Chapter 7 bankruptcy in the U.S. in June 2025, and by mid-2025 U.S. federal prosecutors in the Southern District of New York were actively investigating the company's collapse, including subpoenaing its former CFO, making Builder.ai one of the most prominent examples of alleged financial fraud and "AI-washing" in the generative AI investment boom.
